Finding Text
2020-004 – Reporting
Significant Deficiency in Internal Controls Over Compliance and Instance of Noncompliance
Assistance Listing Number: 59.046
Federal Agency/Pass-through Entity - Program Name: Small Business Administration - Microloan Program
Award Number(s): SBAHQ19Y0115
Award Year(s): 2019
Criteria or specific requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.
According to 2 CFR 200.329(c)(1) states, "Reports submitted quarterly or semiannually must be due no later than 30 calendar days after the reporting period."
Condition: The Organization submitted their "Combined MRF & LLRF Status Reports" for the quarter ending June 30, 2020, more than 30 days after the end of the quarter.
Questioned costs: None
Context: During our audit procedures, we tested two of the four quarterly “Combined MRF & LLRF Status Reports” and noted that the report for the period ending June 30, 2020, was submitted on October 13, 2020, which is 106 calendar days after period-end. The report is due 30 days after the period ends.
Cause: The Organization did not have internal controls in place to ensure the “Combined MRF & LLRF Status Reports” were being filed within 30 calendar days of period end.
Effect or potential effect: The Organization is out of compliance with 2 CFR 200.329(c)(1).
Repeat finding: No
Recommendation: The Organization should implement controls to ensure all reporting, both financial and performance, is completed, reviewed, and submitted before the specific report deadlines.
Views of responsible officials: The Organization agrees with the finding and has implemented controls to ensure all reports are completed, reviewed, and submitted by specific report deadlines. For additional information, see the Organization’s separate report for planned corrective actions.