Finding Text
Finding 2018-003 – Reporting (Noncompliance and Material Weakness in Internal Controls over Compliance – Federal Program CFDA 10.766/10.780 Community Facilities Loans and Grants Cluster)
Criteria: The Compliance Supplement for the program contained financial reporting requirements consisting of an RD 442-2, Statement of Budget, Income, and Equity and an RD-442-3, Balance Sheet.
Condition and Context: The Organization did not file the reports.
Cause: The Organization was not aware of the report filing requirements as contained in the compliance supplement.
Effect: Compliance with the grant/loan reporting requirements was not met.
Questioned Costs: None
Recommendation: We recommend that management monitor any federal grants and/or loans received for any reporting requirements contained in the grant/loan documents themselves, as well as contained in the applicable compliance supplement related to the federal funding as issued by the federal Office of Management and Budget annually.
Views of Responsible Officials and Planned Corrective Actions: As stated in the prior finding, we are creating a position and job description for a financial analyst. Grants and loans compliance and documentation will be a key portion of the job criteria, which will cover all types of loans (both construction and mortgages) and any other debt instruments the organization assumes.