Finding Text
Information on the Federal Programs ? for all findings: Assistance Listing Number 19.345 Finding 2022-002: Lack of Internal Control over Schedule of Expenditures of Federal Awards (SEFA) Condition: During our audit, we noted that the SEFA did not reconcile to the amounts reported on its financial statements. As a result, the SEFA under reported more than $500,000 of expenditures for the period under audit. Criteria: CFR 200.510(b) states that the recipient organization must be able to ?prepare a schedule of expenditures of Federal awards for the period covered by the auditee's financial statements?. The SEFA is required to list the individual Federal programs by Federal agency, name of the pass-through entity, total amount expended, assistance listing number and amounts provided to subrecipients. Context, Effect and Cause: During the year, management does not prepare a SEFA or a reconciliation of Federal expenditures to the expenses reported on an accrual basis in its accounting system. As a result the SEFA was not accurately completed at year-end, which required additional effort to prepare an accurate auditable report. Questioned Costs: Undetermined. Identification as a Repeat Finding: 2021-002 and 2020-002 Recommendation: We recommend CDT establish policies and procedures with respect to SEFA preparation. We also recommend the SEFA be periodically prepared and reconciled with its accounting records. The SEFA should also be reviewed and approved by management, and evidence of such approval should be maintained in its accounting records. Management Views and Corrective Action Plan: Management agrees with the finding and recommendation. Management is working with the accounting team to implement a new process to ensure that an internal SEFA is prepared and reconciled on a quarterly basis, at a minimum. Management will review and approve all reconciliations.