Finding Text
Allowable Costs and Cost Principles
U.S. Department of Treasury, passed through from the Montana Department of Natural Resources and Conservation
ALN: 21.027, Coronavirus State and Local Fiscal Recovery Funds
Criteria: The grant award RW-22-077A scope of work is for Phase 3, 3A and 4 – LiDAR Survey of Pipeline Routes. Musselshell County also contracted with the Authority to pay for a portion of these costs. Code section 2 CFR 200.302 requires recipients to maintain appropriate records and documentation to sufficiently identify the amount, source and expenditure of federal funds for federal awards.
Condition: The Authority received reimbursement for expenses incurred from the County and the Montana Department of Natural Resources and Conservation (DNRC), totaling $55,698. The same costs were incorrectly counted toward both funding sources.
Context: The Authority collected revenue twice for the same costs. No funds were reimbursed to the County. For the DNRC, additional costs were incurred through June 30, 2023, that totaled $13,512, which were not included in any draws or cash receipts from DNRC through June 30, 2023. So essentially the Authority used up some of this overage before year end, resulting in an overage of $42,186.
Effect: The Authority overdrew on revenue by $55,698.
Questioned Costs: We question the costs reported as federal expenditures for this program totaling $42,186.
Cause: The Authority made an error when submitting reimbursement for costs incurred.
Auditor Recommendation: We recommend the Authority: 1) reimburse DNRC or the County for the overage, 2) strengthen internal controls over tracking of expenditures for grants to ensure duplication does not occur in the future.
Authority Response: Based upon DNRC direction, the Authority will pay back DNRC with water user fees from Roundup. The Project Administrator will work with the outside accountant to assist with the record keeping of the Authority