Finding Text
2022-004 Department of Agriculture Federal Financial Assistance Listing #10.766 Communities Facilities Loans and Grants Cluster Reporting Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. Within the letter of conditions dated June 27, 2017 for 2017 direct loan and letter of conditions dated August 12, 2011 for the 2011 direct loan, annual audited financial statements are required to be submitted to USDA. Additionally, within the letter of conditions dated May 7, 2008 for 2008 direct loan and letter of conditions dated April 20, 2006 and March 27, 2006 for the 2006 direct loans, the fiscal year operating budget must be submitted and approved by USDA. Condition: The fiscal year 2021 audit report and fiscal year 2022 operating budget were not submitted to USDA until requested during the audit. Cause: The Organization did not have an internal control process in place to ensure timely submission of required reports. Effect: The required reports were not submitted to USDA until requested during the audit. Questioned Costs: None reported. Context/Sampling: Sampling was not used. Repeat Finding from Prior Years: No Recommendation: We recommend management implement a process and controls ensuring timely submission of required reports. Views of Responsible Officials: Management agrees with the finding.