Maine Rural Water Association

2024-002 – US Department of Agriculture – Federal Assistance Listing Number 10.XXX Circuit Rider Program and Federal Assistance Listing Number 10.761 Wastewater Technical Assistance and Training Criteria: The Association uses an indirect cost rate to allocate indirect costs to Federal Award Programs. Management is responsible for ensuring that the indirect cost calculations are prepared accurately and journal entries are accurately posted to allocated indirect costs to federal programs. Condition: Errors were identified in the spreadsheets used to calculate the indirect cost rate and record journal entries to allocate these costs to the various programs. Cause: In preparing and reviewing the spreadsheet, check figures were not used to verify that total costs allocated agreed to total costs available to allocate. Effect: Indirect costs allocated to programs were overstated due to the error identified with the formula, which also resulted in grant funds receivable being overstated. 2024-002 – Impacts all Federal Awards listed on SEFA Effect: continued: Program Decrease to Indirect Expense Impact to Grant Revenues USDA Circuit Rider Program 10.XXX $ 23,499 $ (9,468) Source Water Protection Project 10.XXX $ 9,230 $(14,046) Wastewater Tech. Assistance 10.761 $ 12,772 $ (7,000) Disaster Recovery Circuit Rider 10.761 $ 13 $ 1,816 US EPA Training and Technical Assistance 66.424 $ 12,564 $(12,564) Private Drinking Water Well Owners 66.436 $ 1,143 $ (1,143) Wastewater Treatment Works – Tech 66.446 $ 1,618 $ (1,618) Wastewater Treatment Works – Tribal 66.446 $ 281 $ (281) Wastewater Treatment Works – Decentralized 66.446 $ 555 $ (555) US Department of Labor Apprenticeship/Congressionally Directed Spending 17.289 $ 7,885 $ (7,885) Recommendations: We recommend adding check figures to this spreadsheet as a way to verify the calculation is complete and accurate, as well as the journal entry to reclassify the expense to the Association’s programs. Responses: The Association agrees with this finding and is in the process of setting up this procedure. The Association also feels that hiring a CFO will provide additional oversight over this calculation and posting of journal entries for indirect costs. Once the procedures have been set up and implemented the Association believes it will be in a much better position to attain accurate financial reporting.