Finding Text
Reference Number: 2022-002
Prior Year Finding: No
Federal Agency: U.S. Department of Housing and Urban Development
Pass-through Agency: Various
Federal Program: Emergency Solutions Grant Program
ALN Number: 14.231
Compliance Requirement: Equipment and Real Property Management Type of Finding: Significant Deficiency, Noncompliance
Criteria or specific requirement:
Compliance Requirements- Equipment Management -- Grants and Cooperative Agreements
Equipment means tangible personal property, including information technology systems, having a useful life of more than one year and a per-unit acquisition cost which equals or exceeds the lesser of the capitalization level established by the non-federal entity for financial statement purposes or $5,000 (2 CFR section 200.1). Title to equipment acquired by a non-federal entity under grants and cooperative agreements vests in the non-federal entity subject to certain obligations and conditions (2 CFR section 200.313(a)).
Non-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which
require that:
(b) Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).
(c) A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).
Condition:
Based on our review of the Equipment and Real Property Management compliance requirements, we noted that the Division has written policies regarding Equipment and Real property management. We noted that, Division’s property records did not include all required elements as required by (2 CFR section 200.313(d)(1)).
We also noted that, physical inventory of the property was not performed and thus the results were not reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).
Cause:
The Division did not ensure that as a non-Federal entity Division’s, Property records must:
(1) include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property.
(2) A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years.
Effect:
Division is not in compliance with federal compliance requirements for Equipment and Real Property management.
Questioned costs:
Cannot be determined
Recommendation:
We recommend that the Division must:
• include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property.
• A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years.
Views of responsible officials:
Divisional Headquarters and the local units will include all relevant information on the master vehicle list and take a physical inventory at leas once every two years.
See corrective action plan.