FAC Explorer

Finding 515748 (2024-002)

Material Weakness Repeat Finding
Requirement
P
Questioned Costs
-
Year
2024
Accepted
2024-12-18
Audit: 333605
Organization: Detroit Transportation Corporation (MI)
Auditor: Alan C Young & Associates PC

AI Summary

  • Core Issue: DTC failed to prepare a complete and accurate Schedule of Expenditures of Federal Awards (SEFA) due to inadequate systems for identifying federal expenditures.
  • Impacted Requirements: Compliance with 2CFR Part 200 was not met, leading to a material weakness in reporting federal expenditures.
  • Recommended Follow-Up: Improve coordination between the grants and fiscal departments to ensure timely drawdowns and reconciliations of grant-related expenses.

Finding Text

Criteria – 2CFR Part 200 requires an auditee to prepare a complete and accurate Schedule of Expenditures of Federal Awards (SEFA). Condition – During our audit, we noted that DTC did not have a system in place to correctly identify and record the federal expenditures. We noted certain matters that collectively constituted a material weakness in reporting the federal expenditures. The items noted are as follows: Due to lack of coordination between the grants department and the fiscal department, FTA drawdowns were not performed on a timely basis. Timing differences were noted in reporting the expenses in the financial statements and the federal drawdowns. It was further noted that a reconciliation of the grant-related expenses with the general ledger was not performed on a timely basis. Questioned Costs – None Cause/Effect – The SEFA was not accurately stated as a result of not identifying certain federal award expenditures.

Corrective Action Plan

The policy and procedures guiding grant related activities are actively under redesign to ensure timely drawdowns and reconciliations. Input from executive, grants, and finance staff, as well as third party vendors shall be incorporated in the redesign. All related staff will be trained. DTC shall assign one responsible party to complete the Schedule of Expenditures of Federal Awards (SEFA).

Categories

Reporting

Other Findings in this Audit

  • 515749 2024-002
    Material Weakness Repeat
  • 515750 2024-002
    Material Weakness Repeat
  • 515751 2024-002
    Material Weakness Repeat
  • 515752 2024-002
    Material Weakness Repeat
  • 515753 2024-002
    Material Weakness Repeat
  • 515754 2024-002
    Material Weakness Repeat
  • 515755 2024-002
    Material Weakness Repeat
  • 515756 2024-002
    Material Weakness Repeat
  • 515757 2024-003
    -
  • 515758 2024-003
    -
  • 1092190 2024-002
    Material Weakness Repeat
  • 1092191 2024-002
    Material Weakness Repeat
  • 1092192 2024-002
    Material Weakness Repeat
  • 1092193 2024-002
    Material Weakness Repeat
  • 1092194 2024-002
    Material Weakness Repeat
  • 1092195 2024-002
    Material Weakness Repeat
  • 1092196 2024-002
    Material Weakness Repeat
  • 1092197 2024-002
    Material Weakness Repeat
  • 1092198 2024-002
    Material Weakness Repeat
  • 1092199 2024-003
    -
  • 1092200 2024-003
    -

Programs in Audit

ALN Program Name Expenditures
20.507 Federal Transit Formula Grants $3.08M
20.525 State of Good Repair Grants Program $2.53M
20.513 Enhanced Mobility of Seniors and Individuals with Disabilities $708,510
20.205 Highway Planning and Construction $76,120