Finding Text
U.S. DEPARTMENT OF TREASURY: 2022-029 Compliance with Allowable Cost Fiscal year finding initially occurred: 2022 Coronavirus State and Local Fiscal Recovery Funds (21.027) See Compliance Finding 2022-024. 2022-024 Compliance with Allowable Cost Fiscal year finding initially occurred: 2022 Coronavirus State and Local Fiscal Recovery Funds (21.027) Criteria In accordance with 2 CFR part 200, in order for a cost to be allowable under the grant, the payment must not have been made for an incorrect amount under statutory, contractual, administrative, or other legally applicable requirement. Louisiana state law (R.S. 33:4712.10) requires all political subdivisions to obtain an appraisal when purchasing immovable property greater than $3,000. In addition, the purchase price cannot exceed the appraisal amount (A.G. Op 09-0293) Condition A sample of 14 disbursement transactions were selected for testing from a population of 33 transactions. The test found that 1 disbursement was for the purchase of property where the Government paid $10,000 more than the appraisal. Our sample was a statistical sample. Cause The Government did not adhere to its policies and procedures regarding purchasing of immovable property. Effect The Government may be required to reimburse this unallowable cost to the grantor. Recommendation The Government should determine the reason the policies and procedures were not adhered to and strengthen them so that they are effective going forward. Views of Responsible Officials and Planned Corrective Action The Government agrees with this finding. Procedures have been put in place to ensure the Purchasing division will not process any request for purchases of land sent through their office without having the appraisal in hand. In the event multiple appraisals are provided, Purchasing will ensure that the lowest appraisal is the value used for the purchase. The field will be retrained that all purchases must be submitted through the Purchasing division to ensure these procedures can be enforced prior to payment. This project is expected to be completed by October 31, 2023 and will be overseen by Interim Chief Financial Officer Lowell Duhon.