Finding 500290 (2023-004)

Finding 2023–004: Reporting Federal Department: U.S. Department of Treasury Pass-through Agencies: Cook County, Illinois and Women's Business Development Center COVID-19 - Coronavirus State and Local Fiscal Recovery Funds, Federal Assistance Listing Number 21.027 Criteria The Subrecipient Agreement for American Rescue Plan Act – State and Local Fiscal Recovery Funds between Cook County, Illinois (the County) and SDA, Exhibit A – Scope of Work states SDA shall provide performance and financial metrics and reports to the County on a monthly basis or as determined by the County and outlined in reporting and metrics sections of this agreement. Per the agreement, invoice (expense) submission is due at the end of each month and/or if funds are received in advance, the submission is due within one month of the expenditure. In addition, monthly performance (impact metrics) reporting of data will take place on the 15th day of each month following the reporting period in which it is applicable. The following program metrics will be collected and provided to the County in the following categories: 1) Client service metrics; 2) Develop annual survey to capture business growth metrics; 3) Develop annual survey to capture capital metrics; 4) Marketing and outreach metrics; and 5) Financial reporting. The 2022 Subaward and Fund Distribution Memorandum of Understanding (MOU) agreement between the Women’s Business Development Center (WBDC) and SDA states that financial reports, back-up documentation and invoices are to be submitted on a quarterly basis. Per SDA, the NT 110 report is due by the 15th day of each month. Condition During the current audit period, SDA did not comply with the reporting requirements outlined in its grant agreements. Cause This finding occurred in part due to a massive change in reporting systems by the County, which required manual reports submitted while GovGrants was corrected and fixed for submission. In addition, the County did bulk uploads of prior submitted data which did not save the original submission dates of SDA reports. Finally, SDA needs to be more consistent with following fiscal policies to the letter. Effect Failure to submit reports in a timely manner impairs the grantor agency’s ability to monitor program activities and could result in the loss of grant funding. Also, the failure to maintain adequate supporting documentation could result in inaccurate reporting and is a violation of grantor(s) reporting requirements.   Questioned Costs None. Context During our tests of monthly and quarterly reports submitted under the program, we reviewed a total of eight financial and nine performance reports (six monthly financial and performance reports from the two County (NT-106 and NT-108) grant agreements and two quarterly financial and three monthly performance reports from the WBDC (NT-110) grant agreement). We noted the following:  For all nine performance reports, we noted no evidence of review/approval of the reports prior to submission during 2023.  For one NT-106 and all three NT-110 monthly performance reports tested, we were not provided with any evidence of report submission. As such, we were unable to verify that the reports were submitted in a timely manner. Also, for one of these NT-106 reports, we were not provided with any supporting documentation to verify the performance metrics included in the report.  We noted two reports (one NT-108 monthly performance report and one NT-110 quarterly financial report) were submitted late, ranging from 13 to 70 days late. Identification of Repeated Findings Repeated (Prior Finding No. 2022-004). Recommendation We recommend that SDA implement procedures to ensure required reports are prepared, reviewed and submitted in a timely manner and in compliance with its grant agreements. Additionally, adequate documentation should be appropriately maintained to support all reports prepared and submitted under the grant agreements. Views of Responsible Officials and Planned Corrective Action SDA agrees with the finding and recommendation. See SDA’s Corrective Action Plan on pages 40 – 44.