FAC Explorer

Finding 49751 (2022-011)

Material Weakness
Requirement
C
Questioned Costs
-
Year
2022
Accepted
2023-03-29
Audit: 49440
Organization: Delaware State University (DE)
Auditor: Cliftonlarsonallen LLP

AI Summary

  • Core Issue: The University did not minimize the time between receiving federal funds and spending them, leading to unspent funds and unremitted interest.
  • Impacted Requirements: Non-compliance with 2 CFR 200.305(b)(1) regarding timely disbursement and 2 CFR 200.305(b)(9) for remitting excess interest earned.
  • Recommended Follow-Up: The University should establish and monitor procedures to ensure timely fund disbursement and proper remittance of interest to the federal government.

Finding Text

2022-011 ? Cash Management Federal Agency: U.S. Department of Education Federal Program Title: Education Stabilization Fund ? Higher Education Emergency Relief Fund ? Student Aid Portion and Institutional Portion Federal Assistance Listing Numbers: 84.425E and 84.425F Federal Award Identification Number and Year: P425J200019, P425F203028 and P425E201388 ? all grants were awarded within 2020-2021 and 2021-2022 Award Period: 7/1/2021 ? 6/30/2022 Type of Finding: Other Matters and Material Weakness in Internal Control Over Compliance Criteria or Specific Requirement: The Code of Federal Regulations, 2 CFR 200.305(b)(1), the non-Federal entity must be paid in advance, provided it maintains or demonstrates the willingness to maintain both written procedures that minimize the time elapsing between the transfer of funds and disbursement by the non-Federal entity, and financial management systems that meet the standards for fund control and accountability as established in this part. Advance payments to a non-Federal entity must be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the non-Federal entity in carrying out the purpose of the approved program or project. The timing and amount of advance payments must be as close as is administratively feasible to the actual disbursements by the non-Federal entity for direct program or project costs and the proportionate share of any allowable indirect costs. The non-Federal entity must make timely payment to contractors in accordance with the contract provisions. The Code of Federal Regulations, 2 CFR 200.305(b)(9) Interest earned amounts up to $500 per year may be retained by the non-Federal entity for administrative expense. Any additional interest earned on Federal advance payments deposited in interest-bearing accounts must be remitted annually to the government. Condition: The University did not utilize all funds drawn down therefore, they did not minimize the amount of time between the transfer of funds and disbursement. Additionally, interest was earned on the unspent funds and it was not remitted to the federal government as of year-end. Questioned Costs: N/A. Context: During testing of the cash management requirements, 2 draw downs out of a total of 5 tested were not spent in their entity. $14,719,854 of funds were drawn in January 2022, as of June 30, 2022, $8,423,447 had not been disbursed. Additionally, the University earned interest greater than $500 which was not remitted as of report date. Cause: University does not have a documented procedure or control that minimizes the time elapsing between the transfer of funds and disbursement, or returning earned interest. Effect: Failure to document and adhere to procedures to minimize the time elapsing between transfer and disbursement of funds and the University incurred interest that has not been remitted back to the treasury. Repeat Finding: No Recommendation: We recommend the University formally design and implement controls and monitor advances in federal funds to ensure time elapsing between the transfer of funds and disbursement is minimized and any interest required to be remitted is calculated and returned on a timely basis. Views of Responsible Officials: There is no disagreement with the audit finding and the University is in the process of implementing corrective procedures.

Corrective Action Plan

2022-011 COVID-19, Education Stabilization Fund: Higher Education Emergency Relief Fund - Student Aid Portion and Institutional Portion ? Federal Assistance Listing Nos. 84.425E and 84.425F ? Cash Management Recommendation: We recommend the University formally document, establish controls and monitor advances in federal funds to ensure time elapsing between the transfer of funds and disbursement is minimized and any interest required to be remitted is calculated and returned on a timely basis. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The University will formally document, establish controls and monitor advances in federal funds to ensure time elapsing between the transfer of funds and disbursement is minimized and any interest required to be remitted is calculated and returned on a timely basis. Name(s) of the contact person(s) responsible for corrective action: Assistant Controller, Sasha N. Lee. Planned completion date for corrective action plan: June 2023

Categories

Cash Management

Other Findings in this Audit

  • 49738 2022-007
    Significant Deficiency Repeat
  • 49739 2022-008
    Significant Deficiency Repeat
  • 49740 2022-009
    Significant Deficiency
  • 49741 2022-006
    Significant Deficiency Repeat
  • 49742 2022-007
    Significant Deficiency Repeat
  • 49743 2022-008
    Significant Deficiency Repeat
  • 49744 2022-009
    Significant Deficiency
  • 49745 2022-005
    Significant Deficiency Repeat
  • 49746 2022-007
    Significant Deficiency Repeat
  • 49747 2022-008
    Significant Deficiency Repeat
  • 49748 2022-009
    Significant Deficiency
  • 49749 2022-006
    Significant Deficiency Repeat
  • 49750 2022-010
    Significant Deficiency Repeat
  • 49752 2022-010
    Significant Deficiency Repeat
  • 49753 2022-011
    Material Weakness
  • 626180 2022-007
    Significant Deficiency Repeat
  • 626181 2022-008
    Significant Deficiency Repeat
  • 626182 2022-009
    Significant Deficiency
  • 626183 2022-006
    Significant Deficiency Repeat
  • 626184 2022-007
    Significant Deficiency Repeat
  • 626185 2022-008
    Significant Deficiency Repeat
  • 626186 2022-009
    Significant Deficiency
  • 626187 2022-005
    Significant Deficiency Repeat
  • 626188 2022-007
    Significant Deficiency Repeat
  • 626189 2022-008
    Significant Deficiency Repeat
  • 626190 2022-009
    Significant Deficiency
  • 626191 2022-006
    Significant Deficiency Repeat
  • 626192 2022-010
    Significant Deficiency Repeat
  • 626193 2022-011
    Material Weakness
  • 626194 2022-010
    Significant Deficiency Repeat
  • 626195 2022-011
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $35.90M
84.425 Covid-19, Education Stabilization Fund $21.96M
84.063 Federal Pell Grant Program $10.42M
12.630 Basic, Applied, and Advanced Research in Science and Engineering $1.77M
10.205 Payments to 1890 Land-Grant Colleges and Tuskegee University $1.35M
84.031 Higher Education_institutional Aid $1.08M
10.512 Agriculture Extension at 1890 Land-Grant Institutions $874,480
47.083 Integrative Activities $671,655
93.859 Biomedical Research and Research Training $569,971
11.619 Arrangements for Interdisciplinary Research Infrastructure $549,218
10.524 Scholarships for Students at 1890 Institutions (b) $358,523
47.074 Biological Sciences $331,871
93.732 Mental and Behavioral Health Education and Training Grants $316,328
84.007 Federal Supplemental Educational Opportunity Grants $260,001
11.481 Educational Partnership Program $253,411
93.310 Trans-Nih Research Support $223,876
93.268 Covid-19, Immunization Cooperative Agreements $193,287
12.431 Basic Scientific Research $187,528
47.049 Mathematical and Physical Sciences $166,158
93.853 Extramural Research Programs in the Neurosciences and Neurological Disorders $151,448
47.076 Education and Human Resources $143,791
17.268 H-1b Job Training Grants $139,965
12.300 Basic and Applied Scientific Research $127,339
11.307 Economic Adjustment Assistance $125,920
47.050 Geosciences $120,158
84.033 Federal Work-Study Program $116,925
12.800 Air Force Defense Research Sciences Program $100,903
11.419 Coastal Zone Management Administration Awards $98,458
93.912 Rural Health Care Services Outreach, Rural Health Network Development and Small Health Care Provider Quality Improvement $97,786
10.514 Expanded Food and Nutrition Education Program $89,766
12.330 Science, Technology, Engineering & Mathematics (stem) Education, Outreach and Workforce Program $82,284
10.202 Cooperative Forestry Research $71,999
81.123 National Nuclear Security Administration (nnsa) Minority Serving Institutions (msi) Program $69,652
10.500 Cooperative Extension Service $50,724
10.523 Centers of Excellence at 1890 Institutions (b) $49,375
10.311 Beginning Farmer and Rancher Development Program $44,428
20.205 Highway Planning and Construction $43,612
47.075 Social, Behavioral, and Economic Sciences $41,286
84.017 International Research and Studies $40,770
10.351 Rural Business Development Grant $40,163
21.028 Coronavirus Economic Relief for Transportation Services Act $39,710
11.417 Sea Grant Support $38,149
10.001 Agricultural Research_basic and Applied Research $37,433
10.310 Agriculture and Food Research Initiative (afri) $37,155
47.081 Office of Experimental Program to Stimulate Competitive Research $36,074
10.558 Child and Adult Care Food Program $34,230
98.001 Usaid Foreign Assistance for Programs Overseas $34,073
47.041 Engineering $31,359
11.303 Economic Development_technical Assistance $28,543
10.215 Sustainable Agriculture Research and Education $27,373
10.561 State Administrative Matching Grants for the Supplemental Nutrition Assistance Program $25,508
93.286 Discovery and Applied Research for Technological Innovations to Improve Human Health $20,009
93.865 Child Health and Human Development Extramural Research $19,971
21.027 Coronavirus State and Local Fiscal Recovery Funds $19,422
15.904 Historic Preservation Fund Grants-in-Aid $17,026
93.110 Maternal and Child Health Federal Consolidated Programs $16,795
19.040 Public Diplomacy Programs $16,631
93.788 Opioid Str $13,120
10.777 Norman E. Borlaug International Agricultural Science and Technology Fellowship $13,092
15.423 Bureau of Ocean Energy Management (boem) Environmental Studies Program (esp) $9,450
43.008 Education $8,122
15.670 Adaptive Science $7,421
10.515 Renewable Resources Extension Act and National Focus Fund Projects $7,180
12.631 Science, Technology, Engineering and Mathematics (stem) Educational Program: Science, Mathematics and Research for Transformation (smart) $6,300
10.216 1890 Institution Capacity Building Grants $4,360
10.170 Specialty Crop Block Grant Program - Farm Bill $3,566
10.229 Extension Collaborative on Immunization Teaching & Engagement $3,044
20.764 Hydrogen Storage Research and Development $1,200
16.609 Project Safe Neighborhoods $1,177
10.329 Crop Protection and Pest Management Competitive Grants Program $702
47.079 Office of International Science and Engineering $433
10.902 Soil and Water Conservation $4
93.866 Aging Research $-325
43.001 Science $-1,244