Finding 571311 (2024-002)

Material Weakness
Requirement
P
Questioned Costs
-
Year
2024
Accepted
2025-07-15

AI Summary

  • Core Issue: There is a lack of proper segregation of duties in handling federal awards, which increases the risk of errors or fraud.
  • Impacted Requirements: The Agency must ensure that authorization, custody, and recording of transactions are not managed by the same individual to maintain effective internal controls.
  • Recommended Follow-Up: The Agency should review and enhance control activities to improve internal controls, especially given the limited staff situation.

Finding Text

Part III: Findings and Questioned Costs for Federal Awards: INSTANCES OF NONCOMPLIANCE: No matters were noted. INTERNAL CONTROL DEFICIENCIES: Assistance Listing Number: 97.039 Hazard Mitigation Grant Program Federal Award Year: 2024 Prior Year Finding Number: N/A U.S. Department of Homeland Security Passed through the Iowa Department of Homeland Security and Emergency Management 2024-002 Segregation of Duties over Federal Revenues – Duties related to the custody, recordkeeping and reconciling of federal awards are not properly segregated by the Agency. See item 2024-001. ////// Part II: Findings Related to the Financial Statements: INTERNAL CONTROL DEFICIENCIES: 2024-001 Segregation of Duties Criteria – Management is responsible for establishing and maintaining internal control. A good system of internal control provides for adequate segregation of duties so no one individual handles a transaction from its inception to completion. In order to maintain proper internal control, duties should be segregated so the authorization, custody and recording of transactions are not under the control of the same employee. This segregation of duties helps prevent losses from employee error or dishonesty and maximizes the accuracy of the Agency’s financial statements. ////// Condition – All functions of the Agency are performed by the same person. Cause – Limited staff available to segregate duties. Effect – Inadequate segregation of duties could adversely affect the Agency’s ability to prevent or detect and correct misstatements, errors or misappropriation on a timely basis by employees in the normal course of performing their assigned functions. Recommendation – We realize that with a limited number of office employees, segregation of duties is difficult. The Agency should review its control activities to obtain the maximum internal control possible under the circumstances. Response and Corrective Action Planned – We have reviewed procedures and plan to make the necessary changes to improve internal control. We plan to implement these changes as soon as possible. Conclusion – Response accepted. INSTANCES OF NONCOMPLIANCE: No matters were noted.

Corrective Action Plan

Response and Corrective Action Planned – We have reviewed procedures and plan to make the necessary changes to improve internal control. We plan to implement these changes as soon as possible.

Categories

Internal Control / Segregation of Duties

Other Findings in this Audit

  • 1147753 2024-002
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
97.039 Hazard Mitigation Grant $942,822
97.042 Emergency Management Performance Grants $33,442