Finding Text
MATERIAL WEAKNESS AND NONCOMPLIANCE - REPORTING Information on the Federal Programs: Department of the Treasury - CDFI Fund; ALN 21.033, CDFI Equitable Recovery Program; Award No. 22ERP061695; Award Year 2023; Award Amount $2,478,839; Pass-through: not applicable. Department of the Treasury - CDFI Fund; ALN 21.020, CDFI Financial Assistance; Award No. 241FA064970; Award Year 2024; Award Amount $1,110,000; Pass-through: not applicable. Criteria: The CDFI ERP and FA Agreements require mandatory reports to be submitted in accordance with established reporting periods and due dates, and require award funds to be used for eligible activities. Uniform Guidance requires accurate reporting and effective internal control over federal awards. Condition and Context: The award reporting profile reflected a December 31 year-end rather than the Credit Union's September 30 year-end, resulting in reporting deadlines that were not aligned with the applicable fiscal year. Uniform Guidance engagement and reports were not filed on time. This is a repeat finding and included in the Summary Schedule of Prior Findings. In addition, the reported use-of-award category did not fully align with management's description of how the funds were treated. Cause: The Credit Union did not have a documented review process to verify award profile data, report due dates, and use-of-award classifications before submission. Also, The Credit Union did not have a process to ensure timely submission of grant reporting. Effect or Potential Effect: Required reports may be untimely or inaccurate, which may impair CDFI Fund monitoring and expose the Credit Union to corrective action or additional oversight. Questioned Costs: None noted ($0). The issue is reporting- and control-related; no direct unallowable cost was identified. Repeat Finding: Yes – ERP Award. No - FA Award. Recommendation: Management should implement a grant review and approval acceptance process, grant reporting calendar and review process that reconciles reporting periods to the Credit Union's fiscal year, assigns preparer and reviewer responsibilities, documents review, and reconciles reported categories to the general ledger and supporting records before submission. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding. The Credit Union will implement a grant review and approval acceptance process, grant reporting calendar, assign preparer and reviewer responsibilities, document management review before submission, reconcile reported categories to the general ledger and supporting records, and evaluate whether corrected submissions or an award profile update are needed.