Finding Text
Finding 2023-001: SEFA – Material Weakness
Criteria: U.S. Code § 200.508(b) states that an auditee must prepare appropriate financial statements,
including the Schedule of Expenditures of Federal Awards (SEFA) in accordance with § 200.510.
U.S. Code § 200.510(b)(3) states that at a minimum the SEFA provide total Federal awards expended
for each individual Federal program and the Assistance Listings Number or other identifying number
when the Assistance Listings information is not available. For a cluster of programs also provide the
total for the cluster.
The inclusion of correct Assistance Listing numbers on the SEFA is a critical factor in determining
major and non-major programs and designing appropriate audit procedures for individual grants.
Condition: The SEFA prepared by management included an incorrect Assistance Listing (AL)
number for one grant. Federal grant AL No. 20.513 Enhanced Mobility of Seniors and Individuals
with Disabilities was incorrectly identified as AL No. 20.507 Mobility Management. While both
grants are from the Federal Transit Agency, they fall under different clusters in the Office of
Management and Budget’s Compliance Supplement and thus have different audit requirements.
Cause: Paratransit’s internal controls over the completeness of the SEFA were not operating
effectively.
Effect: The grant in question was initially identified as a major grant and certain audit procedures
were applied. The revision of the AL number resulted in this grant being considered non-major, thus
not required to be tested.
Recommendation: We recommend management verify with the grantor the AL number of the grant.
This can be done by obtaining this information from grant documents, or direct communication with
the grantor. We further recommend the SEFA be reviewed for accuracy by an individual not included
in the SEFA preparation process. Review should be notated with initials and date.
Management’s Response: See Corrective Action Plan