Finding Text
2021-010 Maintenance of Documentation of Internal Control Over Compliance
U.S. Department of Justice, Passed through Illinois Criminal Justice Information Authority
Crime Victim Assistance – Assistance Listing Number 16.575
U.S. Department of Health and Human Services
COVID-19, Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution – Assistance Listing Number 93.498
Criteria: Uniform Grant Guidance (2 CFR 200.303) requires nonfederal entities receiving Federal awards to establish and maintain internal controls designed to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements. Effective internal controls should include procedures to ensure that documentation to evidence the operation of the controls, such as supervisory reviews.
Condition: The Corporation did not have sufficient documentation that internal controls were in place and operating effectively for control activities required for assessment of activities allowed or unallowed and for allowable costs/cost principles. The Corporation also did not have sufficient documentation that internal controls were in place and operating effectively for monitoring procedures required for cash management and reporting compliance requirements. Although the Corporation provided documentation supporting the costs reported, there was no formal documentation of the control activities for approval of activities allowed or unallowed and allowable costs/cost principles. Formal documentation of the supervisory review of cash management and supervisory review and approval of the information compiled for the reporting compliance requirement was also unavailable.
Cause: The Corporation did not maintain documentation evidencing the operation of specific internal controls.
Effect: Lack of properly documented evidence of approval of activities allowed or unallowed and allowable costs/cost principles. Lack of properly documented evidence of supervisory review of cash management and reporting policies and procedures could result in the loss of future funding.
Questioned costs: None
Identification as a repeat finding, if applicable: This is not a repeat finding.
Recommendation: We recommend that management review current processes, polices, and procedures to ensure that approval of activities allowed or unallowed and approval of allowable costs/cost principles are properly documented. We recommend that management review current processes, policies, and procedures to ensure that supervisory review of cash management and reporting compliance requirements are properly documented.
View of responsible officials of the auditee: Management agrees with the finding and recommendation.