Partnership for the Delaware Estuary, Inc.Non-Profit

Criteria or Specific RequirementInternal Control2 CFR section 200.303(a) states, ?a non-Federal entity must establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and terms and conditions of the Federal award. These internal controls should be in compliance with guidance in Standards for Internal Control in the Federal Government issued by the Comptroller General of the United States or the Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).ComplianceThe Environmental Protection Agency?s (EPA) General Terms and Conditions effective April 27, 2017, section 12, states; ?EPA recipients must submit Federal Financial Reports at least annually and no more frequently than quarterly. EPA recipients must submit the SF-425 no later than 30 days after the end of each specified reporting period for quarterly and semi-annual reports and 90 calendar days for annual and final reports.?The Federal Financial Report Instructions requires the following to be entered:? Line 10a states, ?the cumulative amount of actual cash received from the federal agency as of the reporting period end date.?? Line 10b states, ?the cumulative amount of federal fund disbursements as of the reporting period end date.?ConditionPDE did submit the annual SF-425 within 90 calendar days of its annual period ending September 30, 2021. PDE submitted the SF-425 on December 21, 2021. PDE reported balances on Line 10 - Transactions in the FFR based on transaction activity from January 1, 2021 through September 30, 2021 and not the cumulative amounts for the award period October 1, 2019 through September 30, 2021. In addition, the project period reported of October 1, 2019 through September 30, 2021 does not match the project period of grant award 99398515-1 project period of October 1, 2020 through September 30, 2022.In addition, the SF-425 was prepared by the Accounting Manager but it was not reviewed by another individual for completeness and accuracy.CauseInternal controls were not in place to ensure the annual SF-425 was submitted in accordance with federal requirements.EffectPDE is not in compliance with the EPA?s General Terms and Conditions effective October 1, 2018, Section 12 nor the federal instructions to prepare the Federal Financial Report.Recommendation:PDE should develop policies and procedures to ensure the accurate completion and submission of the SF-425.

Criteria or Specific RequirementInternal Control2 CFR section 200.303(a) states, ?a non-Federal entity must establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and terms and conditions of the Federal award. These internal controls should be in compliance with guidance in Standards for Internal Control in the Federal Government issued by the Comptroller General of the United States or the Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).ConditionPDE originally provided a project and loss by class report for expenses charged to the National Estuary Program that were approximately $60,000 higher than revenue recognized. After being made aware of the inaccurate accounting, PDE corrected the expenses. As a result, indirect costs originally charged were approximately $16,000 higher than was allowed. PDE subsequently reduced indirect costs charged and the revenue recognized.CauseA year-end analysis of conditional grant accounting was not completed to ensure revenue was recognized for allowable costs incurred.EffectExpenses including indirect costs were overstated prior to the correction.Recommendation:Develop and implement a month-end close process regarding the DELEP grant prior to drawing down funds to ensure the accuracy of expenses and indirect cost charged and the revenue recognized.

Criteria or Specific Requirement Internal Control 2 CFR section 200.303(a) states, ?a non-Federal entity must establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and terms and conditions of the Federal award. These internal controls should be in compliance with guidance in Standards for Internal Control in the Federal Government issued by the Comptroller General of the United States or the Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Compliance The Environmental Protection Agency?s (EPA) General Terms and Conditions effective April 27, 2017, section 12, states; ?EPA recipients must submit Federal Financial Reports at least annually and no more frequently than quarterly. EPA recipients must submit the SF-425 no later than 30 days after the end of each specified reporting period for quarterly and semi-annual reports and 90 calendar days for annual and final reports.? The Federal Financial Report Instructions requires the following to be entered: ? Line 10a states, ?the cumulative amount of actual cash received from the federal agency as of the reporting period end date.? ? Line 10b states, ?the cumulative amount of federal fund disbursements as of the reporting period end date.? Condition PDE did not submit the annual SF-425 within 90 calendar days of its annual period ending September 30, 2020. PDE submitted the SF-425 on March 25, 2021. In addition, the following was noted: ? Amounts were reported as of December 31, 2020 and not the grant reporting period end date of September 30, 2020. ? Amount on Line 10a, Cash Receipts, was reported as the award amount and not the actual cash received from the federal agency as of the reporting period end date of September 20, 2020. ? Amount on Line 10b, Cash Disbursements, did not equal total disbursements as of the grant reporting period end date of September 30, 2020 or PDE?s year-end date of December 31, 2020. SECTION 3 ? FEDERAL AWARD FINDINGS AND QUESTIONED COSTS (CONTINUED) Cause PDE had the understanding that the SF-425 was due 90 days after its calendar year end and internal directions for the preparation of the report were not consistent with the federal directions to prepare the report. In addition, internal controls were not in place to ensure the annual SF-425 was submitted in accordance with federal requirements. Effect PDE is not in compliance with the EPA?s General Terms and Conditions effective April 27, 2017, Section 12 nor the federal instructions to prepare the Federal Financial Report. Recommendation: PDE should develop policies and procedures to ensure the timely and accurate completion and submission of the SF-425. Views of Responsible Officials: The Executive Director has confirmed the dates of the reporting cycle cannot be extended beyond the December 31 filing date. Also, PDE has been provided instruction on how to properly account for cash receipts and cash disbursements when filing the SF-425. The Development Director has entered the information into the Salesforce software which prompts the Assistant Director to complete the SR-425.

Criteria or Specific Requirement Internal Control 2 CFR section 200.303(a) states, ?a non-Federal entity must establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and terms and conditions of the Federal award. These internal controls should be in compliance with guidance in Standards for Internal Control in the Federal Government issued by the Comptroller General of the United States or the Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). PDE?s internal cash disbursement procedures required an Expense Request Form to be approved prior to initiating all purchases. Condition PDE was unable to provide approved expense request forms for six of six invoices, totaling $11,815, selected for internal control and compliance testing for activities allowed or unallowed and cost principles compliance requirements. Cause PDE moved to a remote work environment in March 2020 as a result of the COVID-19 pandemic. Effect PDE did not provide evidence of authorization of purchases. Recommendation: PDE should update its internal control policies and procedures and document storage requirements to reflect its shift from working in an office to a remote environment. Views of Responsible Officials: The Assistant Director is implementing a more efficient remote filing system within the organization?s server to ensure copies of documents are accurate and available for research. The Assistant Director is also requiring staff to keep accurate records of authorized expense requests and/or receipts in their files in order to have additional copies available if necessary.

Criteria or Specific RequirementInternal Control2 CFR section 200.303(a) states, ?a non-Federal entity must establish and maintain effectiveinternal control over Federal award that provides reasonable assurance that the non-Federal entityis managing the Federal award in compliance with Federal statutes, regulations and terms andconditions of the Federal award. These internal controls should be in compliance with guidancein Standards for Internal Control in the Federal Government issued by the Comptroller Generalof the United States or the Internal Control Integrated Framework,? issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO).ComplianceThe Environmental Protection Agency?s (EPA) General Terms and Conditions effective April27, 2017, section 12, states; ?EPA recipients must submit Federal Financial Reports at leastannually and no more frequently than quarterly. EPA recipients must submit the SF-425 no laterthan 30 days after the end of each specified reporting period for quarterly and semi-annualreports and 90 calendar days for annual and final reports.?ConditionPDE did not submit the annual SF-425 within 90 calendar days of its annual period endingDecember 31, 2019.CauseControls were not in place to ensure the annual SF-425 was submitted in accordance with federalrequirements.EffectPDE is not in compliance with the EPA?s General Terms and Conditions effective April 27,2017, Section 12.Recommendation:PDE should develop policies and procedures to ensure the timely and accurate completion andsubmission of the SF-425.