Finding 563789 (2024-002)

Significant Deficiency Repeat Finding
Requirement
ABCI
Questioned Costs
-
Year
2024
Accepted
2025-06-04
Audit: 358000
Organization: Leelanau County, Michigan (MI)

AI Summary

  • Core Issue: The County lacks formal written policies for payments, procurement, and cost allowability, which are required by the Uniform Grant Guidance.
  • Impacted Requirements: Compliance with federal guidelines on payments, procurement, allowable costs, compensation, and travel expenses is not fully met.
  • Recommended Follow-Up: The County should draft and implement the necessary policies by the end of fiscal year 2025 to ensure compliance.

Finding Text

2024-002 – Written Policies and Procedures Required by the Uniform Grant Guidance (Repeated from Previous Year) Finding Type. Immaterial Noncompliance/Significant Deficiency in Internal Control over Compliance (Allowable Costs/Cost Principles, Cash Management, and Procurement, Suspension and Debarment). Program. Coronavirus State and Local Fiscal Recovery Funds; U.S. Department of Treasury; ALN 21.027. Criteria. The Uniform Guidance requires a non-federal entity that has expended federal awards for a grant awarded on or after December 26, 2014 to have written policies pertaining to various areas, including: 1) Payments (draws of federal funds and how to minimize the time elapsing between the receipt of federal funds and the disbursement to contractors/employees/subrecipients) (§200.302 (6)); 2) Procurement (including bidding and a conflict of interest policy) (§200.318); 3) Allowability of costs charged to federal programs (§200.302 (7)); 4) Compensation (personnel and benefits policy) (§200.430 and §200.431); and 5) Travel costs (including mileage and per diem) (§200.474). Condition. Although the County has processes in place to cover these areas, there are no formal written policies covering payments, procurement, and allowability of costs that address all of the areas required by the Uniform Guidance. Cause. This condition appears to be the result of a time lag in identifying the requirement and developing a plan for compliance. Effect. As a result of this condition, the County did not fully comply with the Uniform Guidance. Questioned Costs. No costs were required to be questioned as a result of this finding inasmuch as our testing did not reveal any unallowed costs or excess cash draws. Recommendation. We recommend that the County draft the required policies as soon as practical, but no later than the end of fiscal year 2025. View of Responsible Officials. Management agrees with the finding and has prepared a corrective action plan.

Corrective Action Plan

2024-002 – Written Policies and Procedures Required by the Uniform Grant Guidance Auditor Description of Condition and Effect. Although the County has processes in place to cover these areas, there are no formal written policies covering payments, procurement, and allowability of costs that address all of the areas required by the Uniform Guidance. As a result of this condition, the County did not fully comply with the Uniform Guidance. Auditor Recommendation. We recommend that the County draft the required policies as soon as practical, but no later than the end of fiscal year 2025. Corrective Action. Administration/Finance with work with legal council and auditors to draft the required changes. Responsible Person. County Administrator. Anticipated Completion Date. December 31, 2025.

Categories

Procurement, Suspension & Debarment

Other Findings in this Audit

  • 563790 2024-003
    Significant Deficiency Repeat
  • 1140231 2024-002
    Significant Deficiency Repeat
  • 1140232 2024-003
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
21.027 Coronavirus State and Local Fiscal Recovery Funds $2.27M
15.226 Payments in Lieu of Taxes $138,371
93.563 Child Support Services $60,796
68.818 Brownfield Mutipurpose, Assessment, Revolving Loan Fund $55,971
97.042 Emergency Management Performance Grants $7,755
16.607 Bulletproof Vest Partnership Program $6,005
97.067 Homeland Security Grant Program $1,845
20.703 Interagency Hazardous Materials Public Sector Training and Planning Grants $1,650