Finding Text
Criteria:
According to 2 CFR § 200.512 (Report Submission) of the Uniform Guidance, non-federal entities that expend $750,000 or more in federal awards during the fiscal year are required to submit the audit report, including the financial statements and the Schedule of Expenditures of Federal Awards (SEFA), to the FAC no later than nine months after the end of the fiscal year or 30 days after receipt of the auditor’s report, whichever is earlier.
Condition:
The Institution did not submit its Single Audit report for the fiscal year ended June 30, 2022 to the Federal Audit Clearinghouse (FAC) within the required timeframe. The report was due within nine months after the end of the fiscal year, as per federal regulations. As of the report date, has not been submitted.
Best practices, as highlighted by the Government Finance Officers Association (GFOA) and the Council on Financial Assistance Reform (COFAR), recommend that entities establish internal processes to ensure compliance with federal reporting deadlines, such as implementing a calendar of key reporting dates and assigning specific responsibilities to team members to monitor and manage audit reporting submissions.
Effect:
Failure to submit the Single Audit report timely could result in non-compliance with federal regulations, jeopardizing the Institution’s eligibility to receive future federal awards or funding. Additionally, late submissions may lead to increased scrutiny from oversight agencies and affect the entity’s reputation with grantors and other stakeholders.
Cause:
The late submission appears to have resulted from a combination of factors, including:
• Delays in completing the financial close and audit process due to significant deficiencies in the financial closing and reporting disclosed in finding 2022-II-1 and resource constraints, turnover in accounting personnel, or unexpected audit complexities.
• A lack of internal processes and controls to monitor and ensure timely submission of the Single Audit report to the FAC.
Recommendations:
We recommend that the Institution implement the following actions to ensure timely submission of the Single Audit report in the future:
1. Establish a Compliance Calendar: Create a detailed compliance calendar that includes key deadlines for the Single Audit submission, as well as internal milestones leading up to the submission date. This calendar should be regularly reviewed and updated.
2. Assign Responsibility: Designate a specific individual or team within the organization to monitor the audit process and ensure that the submission to the FAC occurs within the required timeframe.
3. Implement Review Procedures: Institute formal review and sign-off procedures for audit deliverables, with specific checkpoints to ensure that the audit report is finalized well before the submission deadline.
4. Communicate with Auditors: Work closely with the external auditors to ensure that any potential delays in the audit process are identified early and mitigated to meet the submission deadline.