Finding Text
Criteria
Entities that receive federal grants or programs are required to know the source of all grants and awards as the requirements of the U.S. Office of Management and Budget’s (OMB) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Final Rule (Uniform Guidance). Entities must be able to document the key components of the schedule of expenditures of federal awards.
Condition
The schedule of expenditures of federal awards provided by management included only the name of the program and amount spent. It did not include key information required (organized by federal program or agency, details of sub-recipients, pass through entities and their number, or CFDA numbers) under Uniform Guidance. In addition, federal funds that were expended in a prior fiscal year were incorrectly included in the schedule provided by management.
Context
Management has all the information to complete the schedule of federal awards in compliance with the Uniform Guidance but had not compiled it prior to the start of the audit. In addition, notification from one of the granting agencies during the financial audit indicated that the portion of some of the grants considered federal funding had been updated. Cause
Southern Illinois Center for Independent Living has not had an audit requirement under Uniform Guidance in several years and therefore the current finance director has not had to previously provide the detailed information previously.
Effect
The audit firm assisted with compiling all the necessary information to ensure the schedule of federal awards was complete and accurate. In addition, if the error in federal awards had not been discovered, the result could have been inaccurate reporting of federal expenditures.
Recommendation
We recommend management incorporate proper training and education on the information and amounts that must be outlined in the schedule of federal awards and further we recommend that management prepare the schedule at least annually including in those years when they are not required to have an audit of federal awards under the Uniform Guidance.
Management’s Response
Management has a corrective action plan in place to address the finding as follows:
•Management will prepare the schedule of expenditures of federal awards as part of the year end closing process each year to determine their audit requirements under the Uniform Guidance and provide the schedule to the audit firm during the financial audit process.