Finding 569690 (2024-003)

Material Weakness
Requirement
G
Questioned Costs
$1
Year
2024
Accepted
2025-06-30
Audit: 361030
Organization: Hardee County, Fl (FL)

AI Summary

  • Core Issue: Management costs claimed from FEMA exceeded the allowable 5% threshold, leading to unallowable costs of $35,572.
  • Impacted Requirements: Compliance with 2 CFR 200.302(b)(3) and 200.303(a) regarding proper record-keeping and internal controls over federal awards.
  • Recommended Follow-Up: Implement updated guidance and training on earmarking rules, and conduct regular reviews to ensure compliance.

Finding Text

Earmarking Federal Agency: Department of Homeland Security Federal Program Name: Disaster Grant Public Assistance (Presidentially Declared Disasters) Assistance Listing Number: 97.036 Grant Award Number: 4337DR-FL-2024 Award Period: Various Type of Finding: Material Weakness in Internal Control over Compliance and Other Matters Criteria: Compliance: 2 CFR 200.302(b)(3) states that records that identify adequately the source and application of funds for federally-funded activities. These records must contain information pertaining to Federal awards, authorizations, financial obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the” Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Management costs requested and received from FEMA exceeded the 5% threshold. Questioned Costs: $35,572. Context: Received the total award amount for calculation of the 5% threshold. Compared to the management costs requested and received. Cause: The County requested management fees unaware of the total expenditure amount. Effect: Over request of management fees leads to unallowable costs. Repeat finding: No Recommendation: Provide clear, updated guidance and periodic training sessions on earmarking rules and how to apply them. Conduct reviews of earmarking compliance. View responsible official and planned corrective actions: New procedures will be implemented that strengthen internal controls to ensure clear earmarking guidance and initial review of compliances.

Corrective Action Plan

Department of Homeland Security Federal Emergency Management Agency Disaster Grant Public Assistance – FEMA – Assistance Listing No. 97.036 Recommendation: Provide clear, updated guidance and periodic training sessions on earmarking rules and how to apply them. Conduct reviews of earmarking compliance. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: New procedures will be implemented that strengthen internal controls to ensure that all grant revenues are recorded properly. Name(s) of the contact person(s) responsible for corrective action: Lindsey Barwick, Accounting Manager Hardee County Clerk of Courts & Lorie Ayers, General Services Director Hardee County Board of County Commissioners Planned completion date for corrective action plan: September 30, 2025

Categories

Questioned Costs Matching / Level of Effort / Earmarking Allowable Costs / Cost Principles

Other Findings in this Audit

  • 1146132 2024-003
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $2.72M
81.041 State Energy Program $200,000
21.027 Coronavirus State and Local Fiscal Recovery Funds $138,885
93.563 Child Support Services $96,777
97.042 Emergency Management Performance Grants $46,207
16.606 State Criminal Alien Assistance Program $17,434
20.205 Highway Planning and Construction $6,294
16.738 Edward Byrne Memorial Justice Assistance Grant Program $3,370
45.129 Promotion of the Humanities Federal/state Partnership $1,600