Finding Text
Department: United States Department of Housing and Urban Development
Program Name: Emergency Solutions Grant Program
Federal Assistance Listing Number: 14.231
Significant deficiency - Inadequate internal control over the Schedule of Expenditures and Federal Awards (SEFA)
Criteria: §200.508(b) of the Uniform Guidance states that the organization being audited is responsible for preparing the SEFA. In other words, the auditor is not supposed to be preparing the SEFA on behalf of a client. If a client cannot prepare an accurate SEFA, it is an indicator of a reportable internal control weakness.Condition: The Organization did not prepare a Schedule of Federal Awards prior to our audit. Cause: The fiscal year ended June 30, 2022 was the first year the Organization was required to have an audit performed by an independent CPA and conducted under the rules of the Uniform Guidance. Effect: Inaccurate reporting of the Schedule of Expenditures of Federal Awards (SEFA) could potentially lead to the incorrect inclusion or exclusion of federal programs in the annual single audit. This could result in non-compliance with reporting requirements set by grantors and ultimately jeopardize the renewal of funding. Questioned Costs: None.Repeat Finding: No Recommendation: We recommend the Organization implement a grants administration policy, to ensure all federal grants are properly identified and included on the SEFA, expenditures are reported on the SEFA in accordance with the Uniform Guidance, and the Federal Assistance Listing number has been identified. In addition, we recommend confirming directly with the granting agencies the information reported on the SEFA. Views of Responsible Officials: We agree with this finding and will prepare a complete SEFA prior to future audits.