Finding Text
2024-002: Written Policies and Procedures
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 10.760, U. S Department of Agriculture - Water and waste disposal systems for rural communities
Federal Award Identification Number and Year: RD Loan 92-12 Loan Period 9/6/23 - 9/1/2063, RD Loan 10 Loan and RD Loan 13 Loan period 1/1/24 - 1/1/2064
Type: Material weakness in internal control and material noncompliance with laws and regulations
Repeat Finding: No
Criteria: The Office of Management and Budget (OMB) provides requirements for federal awards in 2 CFR Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Under the Uniform Guidance, non-federal entities must have written procedures for five (5) of the compliance areas, if applicable, and it is recommended that entities have written procedures for any of the other applicable compliance areas that are significant to grant administration.
Condition: The Village does not have documented written procedures over the required compliance areas. The five areas are procedures for determining the allowability of costs in accordance with Subpart E - Cost Principles of the Uniform Guidance and the terms and conditions of the federal award; standards of conduct covering conflicts of interest and governing actions of employees engaged in the selection, award, and administration of contracts; procurement procedures; procedures for conducting technical evaluations of proposals and selecting recipients; and travel policy stating the lodging and subsistence costs incurred by employees and officers for travel will comply with the non-federal entity’s written travel policy.
Identification of How Likely Questioned Costs Were Computed: N/A
Known Questioned Costs: None
Context: N/A
Cause/Effect: The Village controls were not adequate to ensure it followed the federal requirement over these processes.
Recommendation: We recommend the Village adopt written policies and procedures. In addition, we recommend that management review and modify the procurement policy to include all the necessary items outlined in the Uniform Guidance.
View of responsible officials and planned corrective action plan: See attached corrective action plan.