Finding 479806 (2023-003)

2023-003 REPORTING Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number National Endowment for the Humanities Promotion of the Humanities Federal/State Partnership Grant Number: SO-289836-23 45.129 Criteria: 2 CFR 200.303 requires that a 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. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” 2 CFR 200.302(b) states that “the financial management system of each non-Federal entity must provide for… accurate, current, and complete disclosure of the financial results of each Federal award or program…” Condition: For both of the SF-425 reports selected for testing, there was no documentation of review and approval of the SF-425 report prior to submission. For one of the SF-425 reports selected for testing, inaccurate data was input and submitted. Questioned Costs: None Context: Total federal expenditures for the Promotion of the Humanities Federal/State Partnership program were $1,019,055 for the year ended October 31, 2023. Cause: The Council does not have adequate internal controls and policies and procedures in place to ensure that reports contain accurate financial information and are reviewed before submission. Effect: The Council is not reporting accurate financial information to its federal grantor. Identification as a Repeat Finding: This is not a repeat finding from the prior year. Recommendation: We recommend that the Council implement controls and policies and procedures over financial reporting to ensure compliance with federal reporting requirements. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.