Cherokee County Board of CommissionersLocal Government

Criteria: The requirements for subrecipient monitoring for subawards are contained in 31 USC 7502(f)(2) (Single Audit Act Amendments of 1996 (Pub. L. No. 104-156)), 2 CFR sections 200.330, .331, and .501(h); federal awarding agency regulations; and the terms and conditions of awards. Condition: Monitoring activities performed by the County did not encompass certain areas necessary to ensure that the subrecipient administered the subaward in compliance with the terms and conditions of the subaward. Specifically, the County had not verified that a subrecipient that was expected to be audited as required by 2 CFR Part 200, Subpart F, met this requirement (2 CFR section 200.331(f)). Cause/Effect: The County did not have adequate procedures in place for monitoring that a subrecipient had complied with federal regulations. Auditor's Recommendation: The County should review the monitoring plan related to the program to ensure these procedures are done timely and meet the federal requirements for monitoring subrecipients. Views of Responsible Officials and Planned Corrective Actions: The County will review the monitoring plan related to the program and ensure these procedures are done timely and meet the federal requirements for monitoring subrecipients.

Criteria: Agency financial reporting requirements are designed to ensure maximum transparency around the use of award funds consistent with 2 CFR 200 and to enable sufficient monitoring by the Treasury. Condition: Costs reported on certain quarterly report submissions did not correspond to amounts reported in the general ledger. Cause: The County did not have adequate procedures for reconciling amounts used in the preparation of the reports to amounts reported in the general ledger. Effect: Amounts reported to the Treasury did not reconcile to the general ledger. Identification as a Repeat Finding: A similar finding was reported in the prior year?s audit as finding number 2021-002. Auditor's Recommendation: The County should develop procedures to ensure that amounts reported reconcile to the general ledger. Additionally, reports should be reviewed by someone that is independent of the preparation of the report.

Criteria: The County must use it?s own documented procurement procedures, which should reflect applicable state and local laws and regulations, and must conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. Additionally, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Condition: A contract was awarded under the provisions of sole source of procurement however, documentation relating to the award was unclear that this procurement method was appropriate under the circumstances. Additionally, no documentation of the review that the contracting party was not suspended or debarred was included in the procurement documentation. Cause: The County did not retain documentation that the procurement complied with the requirements of the procurement policy or the federal regulations relating to suspension and debarment. Effect: The County did not have evidence that it had complied with federal procurement requirements and it?s internal policy and the contract could have been awarded to a vendor that had been suspended or debarred. The granting agency could require expenditures paid with federal funds relating to this contract, be returned. Exclusion records were subsequently searched and it was determined that the contracting party was not suspended or debarred. Auditor's Recommendation: Procedures relating to retaining appropriate documentation of sole source contracts and consideration that contracting parties have not been suspended or debarred should be strengthened.

Criteria: The regulation in 2 CFR 200.403 requires that except as authorized by statute, in order for costs to be allowable under Federal awards, the costs should not be included as a cost of any other federally-financed program in the current period. Condition: Costs totaling $93,865 were incorrectly charged to the program. Cause: The County did not have adequate procedures for tracking costs being submitted for reimbursement. Effect: Requests for reimbursement submitted under two separate grants included the same costs. Auditor's Recommendation: The County should maintain separate cost centers for each federal funding source.

Criteria: Agency financial reporting requirements are designed to ensure maximum transparency around the use of ERA award funds consistent with 2 CFR 200 and to enable sufficient monitoring by the Treasury. Expenditures and obligations reported in quarterly reports by the grantee are inputs to Treasury?s ERA 2 reallocation expenditure and obligation ratios. The reallocation expenditure ratio determines whether the grantee is subject to involuntary reallocation due to an insufficient ratio and the amount of excess funds subject to recapture by Treasury. CHEROKEE COUNTY, GEORGIA SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2021 Condition: Costs reported on the 9/30/2021 SF-425 report submission was $250,000 higher than the costs reflected in the general ledger for the period. Cause: The County did not have adequate procedures for preparation and review of the report. Effect: Amounts expended were overstated in the report submitted to the Treasury for the period. Auditor's Recommendation: The County should develop procedures to ensure that amounts reported reconcile to the general ledger. Additionally, reports should be reviewed by someone that is independent of the preparation of the report.

Criteria: The regulation in 2 CFR 200.302 requires that the financial management system of each non-Federal entity must provide for records that identify adequately the source and application of funds for federally-funded activities. These records must contain information pertaining to expenditures and be supported by source documentation. Condition/Effect: As noted in Finding 2021-001, the County did not have an adequate method of tracking expenditures for the related grants. Extensive time was required to identify specific costs that had been included in funding requests for each grant. Auditor's Recommendation: The County should maintain separate cost centers for each federal funding source.

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