Finding Text
Finding 2024-002: Preparation of the Schedule of Expenditures of Federal Awards (SEFA)
Federal Agency: Department of Labor, U. S. Department of Treasury, U.S. Department of
Agriculture, U.S. Department of Health and Human Services Administration
Federal Program: Grads2Careers, Center for Sustainable Careers - Building Pathways, Center for
Sustainable Careers - Critical Sector Job Quality, Baltimore Shines, Clean Corps, Baltimore
Community Canopy Initiative, Administration for Community Living Grant
Assistance Listing Numbers: 21.027, 17.268, 17.280, 10.727, 93.071
Compliance Requirement: ReportingType of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance
Criteria: Per 2 CFR §200.510(b), the auditee must prepare a SEFA that includes total Federal
expenditures, the name of the Federal agency, the Assistance Listing Number, and other identifying
information. The SEFA must be accurate, complete, and prepared in accordance with the Uniform
Guidance to facilitate the Single Audit.
Condition: During our audit of the SEFA for the year ended September 30, 2024, we noted that the
initial SEFA provided by management contained material inaccuracies. Specifically, we noted that
certain programs were omitted entirely, several expenditures were incorrectly classified under the
wrong Assistance Listing Number, and certain programs had expenditures that were inaccurately
reported.
Cause: The inaccuracies in the SEFA were primarily due to a lack of formalized procedures and
oversight in the SEFA preparation process. Management relied on manual compilation without a
reconciliation or review step.
Effect or Potential Effect: An incomplete or inaccurate SEFA may result in inadequate audit
coverage, potential noncompliance with Federal reporting requirements, and increased risk of
questioned costs or funding disallowances.
Questioned Costs: None
Context: The initial SEFA provided for audit included approximately $8.4 million in Federal
expenditures. During the audit process, audit procedures identified approximately $1.05 million in
Federal expenditures that were omitted, as well as classification errors affecting roughly 10% of the
total reported expenditures. The SEFA was subsequently revised and corrected by management.
Identification as a Repeat Finding: Not applicable
Recommendation: We recommend that management implement formal procedures for compiling
the SEFA, including a reconciliation of expenditures to the general ledger, review of all grant
agreements for required disclosures, and a documented supervisory review prior to finalization. Staff
involved in Federal grant reporting should also receive training on SEFA requirements under Uniform
Guidance.