Finding 14479 (2022-003)

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Requirement
L
Questioned Costs
-
Year
2022
Accepted
2023-06-20

AI Summary

  • Core Issue: The entity did not complete the required Single Audit after spending over $750,000 in Federal awards during the fiscal year ending September 30, 2021.
  • Impacted Requirements: Compliance with 2 CFR, Part 200, Subpart F mandates that a Single Audit must be conducted and submitted within specific deadlines.
  • Recommended Follow-Up: Management should review all funding agreements and ensure timely audits are performed, consulting with external auditors as needed.

Finding Text

Non-Compliance ? Failure to Undergo the Required Single Audit Critera: 2 CFR, Part 200, Subpart F states that a non-Federal entity that expends more than $750,000 or more during the entity?s fiscal year in Federal Awards must undergo a Single Audit. Single Audits are due to be submitted to the Federal Clearinghouse within 30 days after the audit report becomes available but no later than 9 months after the end of the entity?s fiscal year. Condition: During the year ending September 30, 2021, the entity expended more than $750,000 in Federal awards but did not undergo a Single Audit by the due date. Context/Cause: During the year ending September 30, 2021, the entity obtained a loan commitment from the United States Department of Agriculture Rural Utilities Service under the Water and Waste Disposal Systems Direct Loan Program. This program requires interim financing to finance the construction and expenditures funded by this required interim financing are considered Federal expenditures according to the terms of the agreement. The expenditures under this and other federal programs exceeded $750,000 during the fiscal year ended September 30, 2021. Effects: The required Single Audit was not performed. Recommendation: We recommend that management and the Board review all loan commitments, grant agreements, and other funding terms and conditions and insure that all required reports and audits are performed. Auditee?s Response: The Entity will insure that all agreements are carefully reviewed and will consult with external auditors about performing the required audits on a timely basis.

Corrective Action Plan

Non-Compliance ? Failure to Undergo the Required Single Audit Description of Finding: The auditor found that The Entity did not obtain the required single audit for the year ending September 30, 2021. Statement of Concurrence or Nonconcurrence: Management concurs with this finding. Corrective Action: Management has obtained the required Single Audit for the year ending September 30, 2022, the year in which the interim construction loan was refinanced by the direct loans from the Rural Utilities Service. Management was unaware that the expenditures of the interim construction loan were considered federal expenditures. All of the federal award activity during the September 30, 2021 and 2022 fiscal year ends have been audited as a part of the September 30, 2022 Single Audit. Management will review loan agreements, communicate with oversight agency officials, and consult annually with external auditors about requirements for single audits in the future.

Categories

Matching / Level of Effort / Earmarking Student Financial Aid

Other Findings in this Audit

  • 14477 2022-001
    Material Weakness
  • 14478 2022-002
    Material Weakness
  • 14480 2022-001
    Material Weakness
  • 14481 2022-002
    Material Weakness
  • 14482 2022-003
    -
  • 590919 2022-001
    Material Weakness
  • 590920 2022-002
    Material Weakness
  • 590921 2022-003
    -
  • 590922 2022-001
    Material Weakness
  • 590923 2022-002
    Material Weakness
  • 590924 2022-003
    -

Programs in Audit

ALN Program Name Expenditures
10.760 Water and Waste Disposal Systems for Rural Communities $114,014