Finding 611620 (2022-004)

-
Requirement
B
Questioned Costs
$1
Year
2022
Accepted
2023-08-30
Audit: 24608
Organization: Saline County (IL)

AI Summary

  • Core Issue: Missing documentation for related party transactions raises concerns about compliance and substantiation.
  • Impacted Requirements: Proper documentation is essential for all related party transactions, especially for federal funding.
  • Recommended Follow-Up: Ensure all related party transactions have complete assessed value documentation to verify reasonable pricing.

Finding Text

2022-004 Related Party Transaction Documentation Federal Program: CFDA# 27.027 Department of the Treasury Criteria: Related party transactions should be supported by proper documentation. Condition: During disbursement testing, we noted transactions recorded where proper documentation could not be located. During receipt and disbursement testing of the County's funds for federal awards testing, we noted that assessed value documentation of the purchase of a building for document storage from a related party couldn?t not be provided for one transaction sampled. Questioned Costs: $106,469.42. The questioned costs were determined by using a statistical sample. Context: Total federal funds expended during the fiscal year ending November 30, 2022 under this program totaled $953,712. Cause: These instances occur due to misfiling of documentation or management override of the approval process itself. Effect: The transaction could not be vouched during the testing process, and management may not be able to substantiate transactions recorded without support. We could not determine that the property was purchased at a reasonable price. Recommendation: We recommend that the assessed value documentation or other supporting documentation be kept on file for all related party transactions to ensure the property was purchased at a reasonable price. Managements Response: Recommendations are considered at the issuance of the report.

Categories

Questioned Costs Procurement, Suspension & Debarment

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
21.027 Coronavirus State and Local Fiscal Recovery Funds $930,911
97.042 Emergency Management Performance Grants $22,801