Finding Text
Finding 2024-005 - Significant Deficiency, Compliance
Federal Award No. 10.766
U.S. Department Of Agriculture
Community Facilities Loan –Special Tests and Provisions
Criteria: The USDA established in its Letter of Conditions dated September 13, 2017 certain annual requirements for the College to complete as part of its borrowing of the Community Facilities Loan that was completed in the year ended June 30, 2018.
Condition: The College was informed via confirmation response obtained during the financial statement audit for the year ended June 30, 2024 that the College had not met all of its requirements established in the Letter of Conditions related to its Community Facilities Loan.
Context: We received a confirmation response from Beverly Howard, State Community Programs Loan Technician with USDA as part of our confirmation of the USDA loan balance outstanding at June 30, 2024. The confirmation response provided indicated that the College was deficient in providing to USDA annual budgets, the Business Analysis Questionnaire and Supplemental Data (since the year ended June 30, 2019), proof of insurance (since the year ended June 30, 2022), and the June 30, 2021 annual audit under the Single Audit Act had not been provided to the USDA.
Effect: Without the information requested by the USDA, the USDA may not be able to provide effective oversight of the College’s loan.
Questioned Costs: None noted.
Cause: Due to transition in management teams in prior years, management of the College from the year ended June 30, 2020 through the year ended June 30, 2024 was not made aware of all of the conditions listed in the USDA’s Letter of Conditions.
Indication Of Repeat Finding: This is not a repeat finding.
Recommendation: The College should implement controls to ensure that all of the conditions/requirements noted in the USDA’s Letter of Conditions are met and controls to ensure that the Letter of Conditions are communicated to all relevant parties in periods of management transitions.
Views Of Responsible Officials (Unaudited): The College has provided to the USDA the required documentation that had been identified as not sufficiently provided and has established controls to ensure that the requirements listed in the Letter of Conditions will be met each year going forward.
Completion Date: December 2024
Contact Person: Steven W. Eckman, President