Assistance Listings number and name: 21.027 COVID-19 Coronavirus State and Local Fiscal Recovery Funds Award number and year: SLFRP0665, March 3, 2021 through December 31, 2026 Federal agency: U.S. Department of the Treasury Compliance requirement: Reporting Questioned costs: Not applicable Condition?The County?s Finance Department (Department) did not review and approve all 4 federal program reports (progress reports), including 1 interim and 3 project and expenditure reports, before submitting them to the federal agency. Specifically, the Department was advanced $10,492,363 of program monies, and of this amount, the Department reported expenditures totaling $707,004 in progress reports as of June 30, 2022. However, the Department did not perform an independent review and approval of these required progress reports to ensure the $707,004 of reported expenditures was accurate, agreed to County records, and contained only allowable expenditures. Our testing of the 3 progress reports found the following inaccuracies: ? Both a $631,385 understatement and overstatement, respectively, of program expenditures and obligations on the December 31, 2021 and March 31, 2022, progress reports because the County reported the expenditures and obligations in the wrong quarter. ? A $99,811 overstatement of cumulative program obligations the County reported on both the December 31, 2021 and March 31, 2022, progress reports. ? An overstatement of $555,767 and an understatement of $75,618, respectively, of current and cumulative program expenditures the County reported on the June 30, 2022, progress report. ? Overstatements of $655,578 and $24,193, respectively, of current and cumulative program obligations the County reported on the June 30, 2022, progress report. Effect?The Department?s reporting inaccurate and erroneous program information results in the federal agency being unable to rely on the reports to effectively monitor the Department?s program administration, including its compliance with program requirements and ability to prevent and detect fraud, and to evaluate the program?s success. The County is also at risk that this finding applies to other federal programs that it administers. Cause?The County did not have policies and procedures requiring the Department to perform and document an independent review and approval of the program?s reports before submitting them to the federal agency. Although the Department reported that it had performed independent reviews and approvals of the reports, it did not document these independent reviews and approvals, nor did these reviews detect the errors we noted above. Criteria?Federal agency guidance requires the County to verify and confirm that all program information that it reports is accurate and approved before submitting it.1 Additionally, federal regulation requires establishing and maintaining effective internal control over federal awards that provides reasonable assurance that federal programs are being managed in compliance with all applicable laws, regulations, and award terms (2 CFR ?200.303). Recommendations?The County?s management should: 1. Develop policies and procedures requiring the Department to: a. Perform and document an independent review and approval of all federal program reports before submitting them to the federal agency to ensure the reports are accurate, agree to County records, and contain only allowable expenditures. b. Reconcile program expenditure amounts reported to the County?s accounting records. 2. Adjust or resubmit reports for errors detected on reports the Department already submitted to the federal agency or work with the federal agency so that it is informed of errors on previously submitted reports. 3. Train Department employees responsible for preparing and reviewing reports on what information to gather to prepare the reports and on the County?s policies and procedures. The County?s corrective action plan at the end of this report includes the views and planned corrective action of its responsible officials. We are not required to audit and have not audited these responses and planned corrective actions and therefore provide no assurances as to their accuracy. 1 U.S. Department of the Treasury. (2022.) State and Local Fiscal Recovery Funds: Project and Expenditure Report User Guide, Section IV, Part i.?Subawards or Direct Payments. Retrieved on 4/6/2023 from https://home.treasury.gov/system/files/136/April-2022-PE-Report-User-Guide.pdf.