Finding Text
Criteria - Per Capital Fund Program (CFP) (Assistance Listing Number 14.872) regulations (24
CFR § 905.314(l)), Capital Funds transferred to operations (Budget Line Item (BLI) 1406) are not
considered obligated until the Authority has both budgeted the funds in BLI 1406; and submitted a
voucher request in the Line of Credit Control System (LOCCS) for those funds. The voucher
request date in LOCCS constitutes the point at which the funds become obligated. The reported
obligation amount and date in LOCCS must match the Authority's accounting records, and the
voucher request date must occur before funds are reported as obligated in LOCCS.
Condition - For sampled transactions where CFP funds were transferred to operations, the voucher
request dates in LOCCS occurred after the funds were reported as obligated in the Obligation &
Expenditure tab.
Cause - The Authority did not establish procedures to ensure that the voucher request in LOCCS
was submitted prior to reporting the funds as obligated under the Obligation & Expenditure tab.
Effect - The Authority is not in compliance with the obligation requirements for funds transferred to
operations under CFP. This practice may result in inaccurate reporting of obligations and potential
disallowance of costs not properly obligated according to federal requirements.
Questioned Costs - None identified.
Statistical Sampling - The sample was not intended to be, and was not, a statistically valid sample.
Recommendation - The Authority should revise its procedures to ensure that voucher requests for
BLI 1406 funds are submitted in LOCCS before funds are reported as obligated in the Obligation &
Expenditure tab. Additionally, the Authority should provide training to staff responsible for CFP
administration on the correct sequence for obligating and drawing down funds in accordance with
24 CFR § 905.314(1).
Management’s Response - (a) Comments on the finding and recommendation - The Authority agrees with the finding.
The Authority also agrees with the recommendations, please see below for action taken.
(b) Action taken - The Authority will begin submitting voucher requests for BLI 1406
before funds are reported as obligated.
(c) Planned implementation date of corrective action - Completed by December 31, 2025.