Finding 396244 (2021-007)

Material Weakness
Requirement
L
Questioned Costs
-
Year
2021
Accepted
2024-05-09
Audit: 305892
Auditor: Eide Bailly LLP

AI Summary

  • Core Issue: CFSC reported $11,791 less in expenditures than what was actually incurred, leading to inaccurate financial reporting.
  • Impacted Requirements: This finding violates 2 CFR 200.302(b)(2), which mandates accurate and complete financial disclosures for federal awards.
  • Recommended Follow-Up: CFSC should enhance its policies to ensure all known expenditures are included in future reports to prevent noncompliance.

Finding Text

Finding 2021-007 Program: Office for Coastal Management Federal Financial Assistance Listing: 11.473 Federal Grantor: U.S. Department of Commerce Passed-through: National Fish and Wildlife Foundation Award No. and Year: 0318.19.070225 (2020) Compliance Requirements: Reporting Type of Finding: Material Non-Compliance/Material Weakness Criteria: 2 CFR 200.302(b)(2) - Requirements state that there must be accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. Condition: Expenditures for one financial report that was selected for testing did not agree with the expenditures that were reported on the SEFA and recorded in the General Ledger (difference of $11,791), based on the dates requested in the report. CFSC did not include known operational expenses for the period that were program costs at the time the report was due, which resulted in underreporting expenditures by $11,791. Questioned Costs: No questioned costs were identified as a result of our procedures. Context/Sampling: Sampling was not used. We selected all four reports filed during year. The condition noted above was identified during our procedures over CFSC’s reporting provisions. Repeat Finding from Prior Year: No Effect: CFSC did not include all known expenditures at the time the report was submitted to the National Fish and Wildlife Foundation, increasing the risk of noncompliance. Cause: CFSC’s procedures did not consistently ensure that all known expenditures at the time the report was submitted were included. Recommendation: We recommend that CFSC modify and strengthen its current policies and procedures to ensure that all known expenditures are included at the time reports are required to be submitted. Views of Responsible Officials and Planned Corrective Actions: See Separate Corrective Action Plan.

Corrective Action Plan

Finding 2021-007 Management agrees with the finding and is implementing the accompanying corrective action plan. Views of Responsible Officials: Joel Rusco, Chief Financial and Administrative Officer Jessica Martinez, Program Director Jacy Hyde, Executive Director Contact Person: Joel Rusco, Chief Financial and Administrative Officer Jessica Martinez, Program Director Corrective Action Plan: • Clark Nuber has reviewed the current closing and reporting policies and procedures. Clark Nuber’s proposed updates and revisions will be reviewed and approved by CFSC Management and thereafter implemented by CFSC staff. • CFSC will be considering an automated AP and approval processes through Bill.com or another similar provider to determine whether a provider of this nature will assist in more timely expenditure recognition workflows. • CFSC will update its fiscal reporting policies and procedures to direct that all reports are reviewed by both the grant manager and finance manager to ensure all known expenses are included and that the Schedule of Expenditures of Federal Awards is properly prepared in accordance with the Uniform Guidance. • CFSC will be doing a full review of policies and procedures to ensure they are compliant with GAAP and Uniform Guidance requirements. • The Board of Directors has approved hiring three additional Financial Staff to improve capacity for reporting. Anticipated Completion Date: CFSC will establish and implement the enhanced policies and procedures by the end of Q2 of 2024. CFSC aims to fully onboard additional Finance Staff in Q2 of 2024.

Categories

Reporting Material Weakness

Other Findings in this Audit

  • 396242 2021-005
    Significant Deficiency
  • 396243 2021-006
    Material Weakness
  • 396245 2021-008
    Material Weakness
  • 396246 2021-009
    Material Weakness Repeat
  • 396247 2021-010
    Material Weakness Repeat
  • 972684 2021-005
    Significant Deficiency
  • 972685 2021-006
    Material Weakness
  • 972686 2021-007
    Material Weakness
  • 972687 2021-008
    Material Weakness
  • 972688 2021-009
    Material Weakness Repeat
  • 972689 2021-010
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
11.473 Office for Coastal Management $936,822
10.664 Cooperative Forestry Assistance $30,709
15.228 Blm Fuels Management and Community Fire Assistance Program Activities $22,109