Finding Text
FINDING 2023-002
Information on the federal program:
Federal Agency: Department of the Treasury
Pass-Through Entity: N/A – Direct Grant
Federal Program: Coronavirus State and Local Fiscal Recovery Funds (CSLFRF)
Assistance Listing Number: 21.027
Compliance Requirement: Reporting
Audit Findings: Significant Deficiency
Criteria: The US Department of Treasury’s Compliance and Reporting Guidance for State and Local Fiscal
Recovery Funds requires quarterly project expenditure reports to be completed with the key line items: 1)
Obligations and Expenditures 2) Subawards 3) Detailed information of any loans issued; contracts and
grants awarded; transfers made to other government entities; and direct payments made by the recipient
that are greater than $50,000. For amounts less than $50,000, the recipient must report in the aggregate
for these same categories of loans issued; contracts and grants awarded; transfers made to other
government entities; and direct payments made by the recipient.
Condition: City of Bloomington completed quarterly reporting in a timely manner substantiated by the City’s
expenditure detail. However, management could not differentiate between subrecipients and standard
vendor purchases.
Cause: The City does not have an effective system of internal controls in place to effectively review
CSLFRF reporting data prior to submission to the US Department of Treasury.
Effect: Subrecipient expenditures and subawards on the quarterly data submissions were overstated.
Questioned costs: There are no questioned costs.
Context: During our testing procedures over CSLFRF reporting, we noted that segregation of duties is not
present in the Federal reporting process. The Deputy Controller prepared and submitted the reports without
a secondary review taking place. As a result, the City did not report expenditures for the grant that were
consistent with the expenditures reported on the SEFA and could not properly identify subrecipient
expenditures.
Identification as a repeat finding, if applicable: Yes, finding 2022-003 in the prior year report.
Recommendation: We recommend that the City implement a consistent multi-stage review process for
federal data reports, which involves identifying and tracking subrecipient activity as well as expenditures by
type.
Views of responsible officials and planned corrective actions: Management acknowledges the finding.
See management’s corrective action plan attached to this audit report.