Finding Text
Uniform Grant Guidance Implementation
Federal Assistance Listing Number - All
Federal Agency: All
Federal Program Title: All
Pass-Through Agency: All
Pass-Through Number(s): All
Award Period: All
Compliance Requirement: Allowable costs/cost principles, cash management, procurement, suspension and debarment, and reporting
Type of Finding: Material Weakness in Internal Control over Compliance
Criteria: Uniform Guidance and the State Single Audit Guidelines requires the County to maintain certain policies related to cash management, cost allowability, procurement, and conflict of interest provisions, along with appropriate financial management systems and internal controls over federal and state awards to safeguard federal and state funds.
Condition: The County has various policies and procedures in place ot safeguard its assets and establish related controls over receipts, disbursements, payroll transactions and general ledger maintenance. Federal awards received and disbursed by the County are managed through these county-wide policies and procedures; however, the policies and procedures have not been evaluated to ensure compliance with requirements of Uniform Guidance. As an example, the County is required to have an allowable cost policy which establishes the responsible officials who are able to determine if a cost is allowable. While expenditures tested had documentation of approval, some lacked proper documentation to determine allowability. Implementing a formal policy in accordance with Uniform Guidance and the State Single Audit Guidelines would improve transparency and effectiveness of the County's documentation.
Questioned Costs: None
Context: While performing audit procedures, it was noted that the County does not have policies in place that conform to Uniform Grant Guidance and the State Single Audit Guidelines requirements.
Cause: The County has not completed an assessment of its financial management system and related internal controls over federal and state awards, along with an evaluation of existing policies for compliance with Uniform Guidance and the State Single Audit Guidelines by year-end
Effect: The County could become noncompliant with requirements of Uniform Guidance and the State Single Audit Guidelines, resulting future findings and questioned costs related to federal and state awards administered by the County. The County's 2022 audit in accordance with the requirements of Uniform Guidance identified several instances where proper documentation was not available to determine appropriateness with respect to direct and material compliance requirements of its major federal awards programs.
Repeat Finding: Yes, 2021-004
Recommendation: We recommend the County complete an assessment of its financial management system and related internal controls over federal awards during the 2023 fiscal year. This assessment should include an evaluation of existing policies and procedures to determine where additional enhancements hsould be made or new policies created, a plan to communicate these policies to County employees, and procedures to periodically review and update, as considered necessary.