Finding Text
2023-004 Program: Nationally Significant Freight and Highway Projects
Financial Assistance Listing Number: 20.934
Federal Agency: U.S. Department of Transportation
Pass-through: California Department of Transportation
Award Year: 2019
Grant Award Number: INFRALUL-5459(031)
Compliance Requirements: Cash Management / Matching, Earmarking, Level of Effort
Type of Finding: Material Weakness in Internal Control over Compliance
Criteria:
2 CFR 200.303, the non-Federal entity 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. This includes internal controls over preparation of reimbursement requests.
Condition:
We identified two (2) instances in which the City did not retain evidence to document the individual who reviewed and approved reimbursement requests and matching percentages prior to being submitted to the granting agency. We noted one individual prepares the reimbursement request, calculates the matching percentages, and submits the reimbursements requests.
Cause:
The City's procedures did not include documenting the management review and approval of the reimbursement requests and matching percentages prior to submission to the granting agency.
Effect:
Ineffective internal controls over these areas of compliance could result in reimbursement requests being inaccurate or incomplete prior to submission to the granting agency.
Questioned Costs:
No questioned costs were identified as a result of our procedures.
Context/Sampling:
Sampling was not used. We selected all reimbursement requests (3) for testing.
Repeat Finding from the Prior Year(s):
No.
Recommendation:
We recommend that the City revise its procedures to include evidence to document the individual who reviewed the reimbursement requests prior to submission.
View of Responsible Official and Planned Corrective Actions:
See separate corrective action plan.