Finding 5497 (2023-003)

Finding 2023-003 Administration for Children and Families Federal Financial Assistance Listing #93.566, 2001SDRSOC, 10/01/2019 – 9/30/2022 Federal Financial Assistance Listing #93.566, 2201SDRSSS, 10/01/2021 – 9/30/2023 Federal Financial Assistance Listing #93.566, 2202SDRCMA, 10/01/2021 – 9/30/2023 Federal Financial Assistance Listing #93.566, 2301SDRSSS, 10/01/2022 – 9/30/2024 Refugee and Entrant Assistance – State Administered Programs Reporting Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. 2 CFR Part 170 establishes requirements for recipients’ reporting of information on subawards as required by the Federal Funding Accountability and Transparency Act of 2006 (FFATA). Condition: We noted the following matters during testing: a) The quarterly report ending December 2022 for fiscal year award 2020 improperly excluded expenditures incurred of $85,000 relating to the Services to Older Refugees set-aside services program. b) The semi-annual ORR6, covering the period of 4/1/2022 – 9/30/2022, was not submitted timely. c) The FFATA report filed for Sioux Falls School District included the incorrect Subaward Obligation/Action Date. Cause: The independent review process over the quarterly report did not identify the improperly excluded expenditures. The ORR6 report was not filed timely by management. Within the FFATA report, the Organization included the grant award end date due to misinterpretation of the required FFATA report information. Effect: Ineffective controls over this area of compliance could result in a reasonable possibility that the Organization would not be in compliance with the federal award as it relates to reporting. Questioned Costs: None reported. Context/Sampling: Included under eight award letters of the federal program, four quarterly federal financial reports (SF-425s) and one quarterly federal financial report (ORR2) were reviewed in the Organization’s fiscal year. In addition, one semi-annual programmatic report was reviewed in the Organization’s fiscal year. A total of 24 reports were filed during the Organization’s fiscal year. The FFATA report for the only subrecipient who received funds through this program was tested. The quantity and subaward obligation errors were noted as follows: Subawards Obligations Total Tested 1 $ 2 02,559 Not Reported - - Not Timely - - Obligation Incorrect - - Missing Key Elements 1 202,559 Repeat Finding from Prior Years: Yes, prior year finding 2022-003 Recommendation: We recommend that management review internal control procedures over reporting to ensure reports are submitted timely and accurate information is reported. Views of Responsible Officials: Management is in agreement.