Single Audit Report Fiscal Year Ended June 30, 2012 - State ...

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State of GeorgiaFederal Awards Findings and Questioned CostsFor the Fiscal Year Ended June 30, 2012-Determining Subrecipient Eligibility“… for subawards made on or after October 1, 2010, determining whether an applicant for a non-ARRA subaward has provided a Dun and Bradstreet Data Universal Numbering System (DUNS)number as part of its subaward application or, if not, before award…”-Central Contractor Registration (CCR)“For ARRA subawards, identifying to first-tier subrecipients the requirement to register in the CentralContractor Registration, including obtaining a DUNS number, and maintaining the currency of thatinformation...”-Award Identification“At the time of the subaward, identifying to the subrecipient the Federal award information (i.e.,CFDA title and number; award name and number; if the award is research and development; and nameof Federal awarding agency) and applicable compliance requirements. For ARRA subawards,identifying to the subrecipient the amount of ARRA funds provided by the subaward and advising thesubrecipient of the requirement to identify ARRA funds in the Schedule of Expenditures of FederalAwards (SEFA) and the SF-SAC…”-During-the-Award Monitoring“Monitoring the subrecipient’s use of Federal awards through reporting, site visits, regular contact, orother means to provide reasonable assurance that the subrecipient administers Federal awards incompliance with laws, regulations, and the provisions of contracts or grant agreements and thatperformance goals are achieved.”-Subrecipient Audits“(1) Ensuring that subrecipients expending $500,000 or more in Federal awards during thesubrecipient’s fiscal year for fiscal years ending after December 31, 2003 as provided in OMB CircularA-133 have met the audit requirements of OMB Circular A-133…” “…and that the required audits arecompleted within 9 months of the end of the subrecipient’s audit period; (2) issuing a managementdecision on audit findings within 6 months after receipt of the subrecipient’s audit report; and (3)ensuring that the subrecipient takes timely and appropriate corrective action on all audit findings. Incases of continued inability or unwillingness of a subrecipient to have the required audits, the passthroughentity shall take appropriate action using sanctions.”-Pass-Through Entity Impact“Evaluating the impact of subrecipient activities on the pass-through entity’s ability to comply withapplicable Federal regulations.”In addition, the Highway Planning and Construction Cluster (HPCC) program compliancerequirements included in Part 4 of the OMB Circular A-133 Compliance Supplement state that “StateDOTs are responsible for determining that subrecipients of Federal-aid highway funds have adequateproject delivery systems for projects approved under 23 USC. They also are required to determinewhether subrecipients have sufficient accounting controls to properly manage such Federal-aidfunds…”Information:Cause:Effect:According to interviews with the Department's Internal Audit Division, the reported corrective actionplan for finding control number FA-484-11-03 is scheduled to be in effect on July 1, 2012 (fiscal year2013).The deficiencies noted were the result of the Department’s failure to have adequate internal controlpolicies and procedures in place to ensure compliance with the A-133 requirements for SubrecipientMonitoring.We were unable to determine if the Department complied with the Subrecipient Monitoringrequirements as a result of these deficiencies. In addition, inadequate internal controls over116
State of GeorgiaFederal Awards Findings and Questioned CostsFor the Fiscal Year Ended June 30, 2012Subrecipient Monitoring could result in improper program costs being reimbursed to subrecipients andnoncompliance with Federal regulations.Recommendation:The Department of Transportation should develop, implement, and formally document policies andprocedures over Subrecipient Monitoring to ensure that the A-133 compliance requirements areconsistently followed and documented for subrecipients of Highway Planning and ConstructionCluster funds.Finding Control Number: FA-484-12-06SUBRECIPIENT MONITORINGInadequate Subrecipient Monitoring DocumentationFederal Transit_Capital Investment Grants (CFDA 20.500)Federal Transit_Formula Grants (CFDA 20.507)Formula Grants for Other Than Urbanized Areas (CFDA 20.509)U.S. Department of TransportationGrant Awards: Year 2012 - GA-18-X032; GA-90-X309; Year 2011 - GA-18-X031; GA-90-X286; Year 2010 - GA-04-X030; GA-90-X259; GA-18-X030; Year 2009 - GA-04-X013; GA-04-X017; GA-18-X029; GA-57-X006; GA-86-X001;GA-96-X012; Year 2008 - GA-03-X089; GA-04-X006; GA-04-X028; GA-18-X028; GA-90-X242; Year 2006 - GA-03-X086; Year 1999 - GA-03-X058Condition:Criteria:Our examination of Subrecipient Monitoring for the Formula Grants for Other Than Urbanized Areasprogram (CFDA No. 20.509) and Federal Transit Cluster (CFDA No. 20.500 and 20.507) disclosedthat the Department of Transportation's Office of Intermodal failed to maintain adequatedocumentation of risk assessments and compliance reviews of subrecipients. As a result, we wereunable to determine if the risk assessments and compliance reviews were effective during-the-awardmonitoring procedures.Section 7502 of the Single Audit Act of 1996 provides that each pass-through entity shall monitor thesubrecipient's use of Federal awards through site visits or other means to provide reasonable assurancethat the subrecipient administers Federal awards in compliance with laws, regulations, and theprovisions of contracts or grant agreements.According to Sections 5307 and 5311 of the Office of Intermodal's Program Procedures Manual,"GDOT Intermodal Programs Division through the Transit Program Manager and Transit ProgramCoordinators is responsible for performance of an assessment to identify subrecipient risk on an annualbasis, in May-June of each year. Full Compliance Monitoring Reviews will be performed as neededby the Transit Program Coordinator based on the results of the risk assessment. For high risksubrecipients, compliance reviews will be performed within 90 days of findings of noncompliance ordetermination of high risk. For medium risk subrecipients, reviews will be performed every two (2)years. Complete compliance reviews are conducted by GDOT Program Transit Coordinator everythree (3) years for low risk. The Transit Program Manager must keep subrecipient assessments in acentral repository for tracking, reporting and historical risk assessment information. All relevantinformation relating to the oversight of each subrecipient should be maintained in such manner as to beeasily and quickly identified, complete, and readily available for use."Cause:Effect:Recommendation:The Office of Intermodal was unable to provide adequate documentation of risk assessments andcompliance reviews.Inadequate Subrecipient Monitoring documentation increases the risk that the Office of Intermodal willnot be able to prevent or detect instances where subrecipients fail to use awards for authorizedpurposes, comply with laws, regulations, and the provisions of contracts or grant agreements, andachieve performance goals.The Office of Intermodal should review their current internal control procedures for SubrecipientMonitoring and implement additional procedures, as needed, to ensure that risk assessments and117
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Single Audit ReportFiscal Year Ende
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Report on Internal Control Over Fin
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Foundation, Incorporated, Georgia T
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Firefighters’ Pension Fund, Georg
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Greg S. GriffinSTATE AUDITOR(404) 6
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Activities Allowed or UnallowedFA-4
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Findings and Questioned Costs
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State of GeorgiaSummary of Auditor
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Financial Statement Findings
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