Finding Text
2023-007: Federal Transit Cluster – AL# 20.507, Cash Management – Material
Noncompliance/Material Weakness in Controls over Compliance
Condition:
A lack of cash flow and grant management oversight resulted in contractors and vendors not being
paid timely for the construction of the bus transfer station and construction of bus shelters.
Criteria:
All grant activities should include management level oversight to ensure timeliness, accuracy, and
compliance with specified grant requirements.
Cause:
Lack of proactive cash flow and grant management occurred when invoices were received.
Effect:
Contractors were not paid for over 30 days after receipt of invoice. One vendor was not paid for over
90 days. Repeated delays in payments could result in work stoppage and project delays.
Recommendation:
A designated management level individual should have oversight to require timely drawdowns of
capital grants and timely payment of invoices.
View of Responsible Officials:
Due to technical issues, staff were unable to submit grant draw requests to the Federal Transit
Authority through their Electronic Clearing House Operation [ECHO] system, significantly affecting the
Company’s cash flow. This system access issue was resolved during FY2023 and grant drawdowns
30
started back in March of 2023. Additionally, detailed spreadsheets tracking grant activity have been
developed, which will allow staff members to better monitor reimbursement requests and ensure
vendors are paid timely moving forward.