Finding Text
2023-005 – CASEFILE REVIEW
Federal Agency: U.S Department of Commerce
Federal Program Name: Economic Development Cluster
Assistance Listing Number: 11.307
Pass-Through Agency: N/A – Direct
Pass-Through Numbers: N/A – Direct
Federal Award Identification Number and Year: ED20CHI3070049 and 06-69-06370 - URI:118221
Compliance Requirement Affected: Reporting
Award Period: Year Ended: June 30, 2023
Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matter
Criteria: Standard internal control practices over federal award reporting require that all submitted reports include evidence of formal review and documentation of the date of submission. These controls help ensure accuracy, completeness, and compliance with award-specific timelines and reporting expectations.
Condition: Several reports selected for testing lacked documentation indicating that a formal review had taken place prior to submission. Additionally, some reports were not submitted within the required deadlines established by the terms of the award. Specifically, documentation of review was not available for any of the tested SF-425 or progress reports, and two of four SF-425 reports and one of four progress reports were submitted late.
Questioned Costs: None
Context: Through inquiry and review of reporting procedures, it was determined that internal controls over the review and timely submission of reports were not operating effectively. Reports lacked formal sign-offs or records of supervisory review, and some were filed past their due dates.
Cause: The deficiency was the result of a lack of management oversight in ensuring that reporting procedures were followed and monitored consistently.
Effect: The absence of documented review and the late submission of reports increase the risk that reports may be inaccurate, incomplete, or noncompliant with grant requirements. Failure to submit accurate and timely reports may affect the Commission’s standing with federal awarding agencies.
Repeat Finding: Yes
Recommendation: We recommend the Commission implement formal procedures requiring documented supervisory review of all reports prior to submission. Procedures should also include maintaining clear records of submission dates to demonstrate compliance with federal reporting requirements. Management should ensure that deadlines are monitored regularly and that staff are trained on the importance of timely and accurate reporting.
Views of Responsible Officials: There is no disagreement with the audit finding.
Individual responsible: Jay Trusty, Executive Director