Finding Text
Federal Agency: U.S. Department of Agriculture Federal Program Name: Rural eConnectivity Pilot Program Assistance Listing Number: 10.752 Federal Award Identification Number and Year: MD 1701-A64, 2020 Award Period: July 1, 2020 ? July 1, 2025 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: Per 2CFR ? 200.303(a), non-Federal entities must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). COSO/Internal Control Framework defines control activities as ?policies and procedures that help ensure management?s directives are carried out.? Management review controls are defined as, ?the activities of a person, different than the preparer, through analyzing and performing oversight of activities performed, and is an integral part of any internal control structure.? Questioned Costs: None Condition/Context: The Commission did not have a documented review/ approval process in place for equipment and inventory expenditures charged to the grant for the fiscal year ended June 30, 2022. In addition, the Commission did not maintain evidence of the approval of equipment and inventory expenditures charged to the grant. Cause: The Commission does not have sufficient policies and procedures over internal controls to ensure review and approval of grant expenditures are properly documented. Effect: Expenditures may be charged to the grant that are not eligible. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Commission formalize policies and procedures over internal controls to ensure review and approval of equipment and inventory expenditures are properly documented. Views of responsible officials: Management agrees with the finding.