Finding 367424 (2022-006)

MUNICIPALITY OF MAUNABO, PUERTO RICO SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2022 SECTION III – Federal Award Finding and Questioned Costs FINDING 2022-006 FEDERAL PROGRAM CORONAVIRUS RELIEF FUND 21.019 CATEGORY INTERNAL CONTROL- MATERIAL WEAKNESS NONCOMPLIANCE ALLOWABLE ACTIVITIES AND COST PRINCIPLE CONDITIONS The Municipality could not provide the supporting documentation on the following program transaction: Check Num. Date Amount 208 12/22/21 $530.00 223 3/30/22 $14,150.00 35 6/22/22 $320.00 CRITERIA 2 CFR 200.303 (a) internal control establishes that the non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. CAUSE The Municipality does not have proper internal control over the filling of vouchers for payments. EFFECT Due to the lack of internal controls and supporting information, we could not validate that the disbursement was in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. This situation could result in questioned costs and noncompliance with required regulations. RECOMMENDATION The Municipality should establish adequate procedures and controls, which shall consider, among others, an adequate filling procedure of documentation to support the allowability of its expenditures. The Municipality shall improve its internal controls over the filing and safeguarding of documents in order to easily identify and retrieve payment vouchers and all related supporting documentation. MUNICIPALITY OF MAUNABO, PUERTO RICO SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED JUNE 30, 2022 SECTION III – Federal Award Finding and Questioned Costs (continued) FINDING 2022-006 (continued) QUESTIONED COST: None PRIOR YEAR Not Applicable MANAGEMENT RESPONSE We concur with the finding RESPONSIBLE OFFICIALS Mrs. María Ortiz Martinez, Finance Department Director