Finding Text
as a Repeat Finding:
Elements of this finding are a repeat of Finding 2021-002
Finding:
Internal control processes over financial reporting did not ensure the complete and accurate reporting of
federal awards presented on the Schedule of Expenditures of Federal Awards.
Criteria:
The Organization is responsible for establishing and maintaining controls over the accuracy and
completeness of the program information and expenditure amounts reported on the schedule of
expenditures of federal awards as part of the financial statement close process.
Sample Size and Population:
Sampling was not applicable to this finding.
Condition and Cause:
The SEFA initially prepared for audit incorrectly included contracts for which FareStart provided services
as a vendor rather than as a subrecipient because it was prepared by individuals unfamiliar with the
reporting distinction of the classification. Additionally, the awards for which FareStart served as a
subrecipient were misstated due to the accrual error identified in Finding 2022-001 that resulted from the
high volume of accounting and finance staff turnover at the beginning of the fiscal year.
Effect:
Cumulatively, the errors noted above resulted in the misstatement of major program expenditures that
prompted a preliminary conclusion that a Single Audit was not required for 2022. Furthermore, the errors
caused delays in audit completion resulting in the late submission to the Federal Audit Clearinghouse as
noted in Finding 2022-003.
Recommendations:
Educate staff regarding federal award reporting requirements.
Maintain centralized documentation of government grants that identifies the source of funding and
nature of the contract.
Develop and implement a process to ensure that all public contracts are accrued for monthly.
Questioned Costs:
None
Management Response:
Management response is reported in the “Corrective Action Plan” at the end of this report.
Contact Person:
Carolyn Bardon, Senior Vice President of Finance