Finding Text
2023-002 U.S. Department of Treasury &
Passed through the Commonwealth of Massachusetts Executive Office of Public Safety and Homeland Security
COVID-19 – Coronavirus State and Local Fiscal Recovery Funds – AL# 21.027
Criteria: The compliance supplement identifies four Key Line Items required to be reported to the federal awarding agency which include (1) current period obligation, (2) cumulative obligation, (3) current period expenditure and (4) cumulative expenditure. Per 2 CFR 200.1, an obligation is an order placed for property and services, contracts and subawards made, and similar transactions that require payment.
Condition: On the March 31, 2023 Project and Expenditure report the Town reported $625,231 of obligations for items that did not meet the definition of an obligation.
Cause: The Town did not have a clear understanding of the reporting requirements for obligations.
Effect: The Town overstated the amounts obligated in the March 31, 2023 Project and Expenditure report.
Questioned Costs: None
Repeat Finding from Prior Year: No
Recommendation: The Town should implement procedures to only report obligations on the Project and Expenditure reporting for items that meet the federal criteria for reporting as an obligation.
Views of Responsible Official: Management agrees with the finding.