FAC Explorer

Finding 575509 (2024-004)

Material Weakness
Requirement
I
Questioned Costs
-
Year
2024
Accepted
2025-09-03
Audit: 365493
Organization: Town of Marblehead (MA)
Auditor: Roselli Clark and Associates

AI Summary

  • Core Issue: Internal controls over compliance are weak, leading to unverified suspension and debarment checks for three transactions.
  • Impacted Requirements: Non-federal entities must ensure they do not engage with suspended or debarred parties as per 2 CFR section 200.214.
  • Recommended Follow-Up: The Town should establish procedures to verify and document that all contractors involved in covered transactions are eligible for federal awards.

Finding Text

2024-004 U.S. Department of the Treasury COVID-19 – Coronavirus State and Local Fiscal Recovery Funds - ALN 21.027 Material Weakness in Internal Controls Over Compliance Criteria: Per 2 CFR section 200.214, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Condition: Suspension and debarment compliance was not verified for three covered transactions. Cause: Lack of appropriate oversight resulted in required suspension and debarment checks not being performed. Effect: Grant transactions are not supported adequately, and the Town is at risk of awarding contracts to vendors not eligible to participate in federal awards programs. It was determined that none of the three vendors were suspended or debarred from federal awards. Questioned Costs: None Repeat Finding from Prior Year: No. Recommendation: The Town should implement procedures to document that all contractors under covered transactions that are performing services for the grant are not suspended or debarred. Views of Responsible Official: Management agrees with the finding.

Corrective Action Plan

Condition: Suspension and debarment compliance was not verified for three covered transactions. Corrective Action Plan: The Town will implement the following: • Have the Grant Coordinator review and understand compliance with the Town’s Federal Grant Awards Policy. • Have the Grant Coordinator in conjunction with the compliance accountant develop a standard reporting checklist to be used by all staff preparing or reviewing Federal project submissions. • Implement a two-level review process requiring: o Department-level preparation with supporting documentation. o Grant Coordinator final review and approval before submission of Federal reports. • Require quarterly reconciliations between project expenditures and Federal reporting to ensure accuracy. Anticipated Completion Dates: o By September 30, 2025: Grant Coordinator training completed, and checklist distributed. o Ongoing: Reports will be reviewed and certified quarterly by the Grant Coordinator prior to submission. Contact Information: Donna Cotterell, Grant Coordinator

Categories

Procurement, Suspension & Debarment Internal Control / Segregation of Duties Subrecipient Monitoring Material Weakness

Other Findings in this Audit

  • 575508 2024-003
    Significant Deficiency
  • 575510 2024-003
    Significant Deficiency
  • 575511 2024-004
    Material Weakness
  • 1151950 2024-003
    Significant Deficiency
  • 1151951 2024-004
    Material Weakness
  • 1151952 2024-003
    Significant Deficiency
  • 1151953 2024-004
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
84.425 Education Stabilization Fund $181,993
84.027 Special Education Grants to States $142,917
10.555 National School Lunch Program $92,810
10.553 School Breakfast Program $69,652
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $55,961
16.738 Edward Byrne Memorial Justice Assistance Grant Program $48,604
84.010 Title I Grants to Local Educational Agencies $26,079
16.607 Bulletproof Vest Partnership Program $21,379
21.027 Coronavirus State and Local Fiscal Recovery Funds $12,370
84.365 English Language Acquisition State Grants $10,656
84.424 Student Support and Academic Enrichment Program $9,800
97.042 Emergency Management Performance Grants $4,928
84.367 Supporting Effective Instruction State Grants (formerly Improving Teacher Quality State Grants) $4,786
84.173 Special Education Preschool Grants $2,578
97.044 Assistance to Firefighters Grant $1,025