Finding Text
2021-007 — Equipment and Real Property Management
Federal/state program information:
Funding agency: U.S. Department of Health and Human Services
Title: Indian Self-Determination
ALN: 93.441
Award period: 10/1/2020 – 9/30/2021
Criteria: 2 CFR section 200.313 requires that (1) equipment be used in the program or project for which it was acquired as long as needed, (2) 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, and cost of the property, and (3) a physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Additionally, CBNHC’s Financial Policies and Procedures require a physical inventory of property be taken annually and reconciled to the general ledger.
Condition: CBNHC has not completed a physical inventory of property and equipment in the last two years.
Context: N/A
Questioned Costs: None
Cause: CBNHC was significantly impacted by the COVID-19 pandemic. Additionally, CBNHC is not implementing their Financial Policies and Procedures to ensure that a physical inventory has been taken annually and reconciled to the general ledger.
Effect: CBNHC is not in compliance with equipment and real property management requirements for the Indian Self-Determination program.
Auditor’s Recommendations: CBNHC should implement its Financial Policies and Procedures and plan a physical inventory of its property as quickly as possible. The results of the physical inventory should be reconciled to the general ledger.
Management’s Response: CBNHC did not have the adequate financial or administrative staff to perform a physical inventory and therefore has not been keeping with its Financial Policies and Procedures and performing an annual physical inventory.