Finding Text
2023-002 – Reporting Finding Type. Material Noncompliance/Material Weakness in Internal Control over Compliance (Reporting). Program. Community Development Block Grants/State's Program & Non-Entitlement Grants in Hawaii; U.S. Department of Housing and Urban Development; passed through the Michigan Economic Development Corporation; Assistance Listing Number 14.228; Award Number MSC 221002-WRI. Criteria. The City is required to file Program Progress Reports beginning January 17, 2022, and every six months thereafter. In addition, the City is required to file a final Program Progress Report within 120 days of the expiration of the grant. Additionally, the City is required to file Section 3 summary reports. Condition. The City has not filed any of the required reports as of June 30, 2023. Cause. The City did not have the proper internal controls in place to ensure that all required reports were filed in accordance with the requirements of the grant agreement. Effect. As a result of this condition, the City did not follow federal requirements in regards to filing required reports. Questioned Costs. No costs have been questioned as a result of this finding inasmuch as no disallowed costs were identified. Recommendation. We recommend that the City implement internal controls over reporting to ensure that all required reports are filed in a timely manner. View of Responsible Officials. The City does not have the necessary staffing to handle all of the requirements of large scale projects. As a result, the City hired an engineer and a certified grant administrator to manage many parts of this project and the reporting requirements are part of those duties. Unfortunately, the reports were not filed as required. Both parties are working to correct these mistakes.