Finding Text
2022-006 Federal Agency: U.S. Department of Housing and Urban Development Federal Program: CDBG Entitlement Grant Cluster COVID-19 ? Community Development Block Grant - CV Assistance Listing Number: 14.218 Compliance Requirement: Reporting ? Federal Funding Accountability and Transparency Act (FFATA) Type of Finding: Material Weakness in Internal Control over Compliance, Material Non-Compliance Criteria or specific requirement: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements. The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.) Condition: Subaward information was not reported to FSRS during FY 2022. Section III ? Findings and Questioned Costs ? Major Federal Programs (Continued) Context: Zero of five subawards selected for testing were reported to FSRS. Total subawards tested were $1,434,300, and $0 was reported as required by FFATA requirements. "See Schedule of Findings and Questioned Costs for Chart/Table" Cause: Due to staffing shortages, the City did not have the resources to input all subaward information into the FSRS system. Effect: Subawards were not reported in FRSR in accordance with FFATA requirements. Questioned costs: None Recommendation: We recommend the City develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the City develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS no later than the end of the month following the month of issuance. Views of Responsible Officials: The City agrees with this finding. See separate Correction Action Plan related to this finding.