Overview
In accordance with Section 12 of Chapter 11 of the Massachusetts General Laws, the Office of the State Auditor has conducted a performance audit of certain activities of the Executive Office for Administration and Finance (A&F) for the period July 1, 2020 through April 30, 2022.
We conducted this performance audit in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.
Below is a list of our audit objectives, indicating each question we intended our audit to answer; the conclusion we reached regarding each objective; and, if applicable, where each objective is discussed in the audit findings.
| Objective | Conclusion |
|---|---|
| 1. Did A&F’s Federal Funds Office (FFO) establish a desk review process of the Coronavirus Relief Fund (CvRF) Municipal Program (CvRF-MP) to ensure that all subrecipient expenditures and supporting documentation met the Coronavirus Aid, Relief, and Economic Security (CARES) Act requirements regarding how subrecipients spent funds they received through the CvRF, in accordance with the Office of the Comptroller of the Commonwealth’s “Sub-Recipient Monitoring Policy”? | Partially; see Finding 1 |
| 2. Did FFO sample approximately one-third of eligible municipalities across four rounds of desk reviews, in accordance with the “Desk Review Scope and Methodology” section of FFO’s “Compliance with COVID-19 Federal Funding” policy? | Yes |
| 3. If FFO identified desk reviews with findings related to CvRF compliance, did FFO (1) initiate a formal remediation process to ensure that municipalities with these findings employ enhanced policies and procedures moving forward and (2) recommend compliance best practices to the municipalities in question, in accordance with the “Eligibility Review” section of FFO’s “Compliance with COVID-19 Federal Funding” policy? | No; see Finding 2 |
| 4. Did A&F maintain a debarred vendor list that accurately reflects vendors that should not be awarded state contracts, in accordance with Section 29F(b) of Chapter 29 of the General Laws? | No; see Finding 3 |
To accomplish our audit objectives, we gained an understanding of the aspects of the internal control environment relevant to our objectives by reviewing A&F’s internal control plans in place during the audit period and by interviewing A&F officials.
To obtain sufficient, appropriate evidence to address our audit objectives, we performed the following procedures.
Desk Reviews Process
We selected a random, nonstatistical sample of 35 desk reviews from the population of 108 desk reviews conducted by FFO during the audit period. We did this to determine whether FFO established a desk review process of the CvRF-MP to ensure that all subrecipients met the CARES Act requirements regarding expenditures and supporting documentation for CvRF payments. We reviewed the desk reviews, which included the supporting documentation necessary for FFO to conduct its review (i.e., budgets, invoices, and payroll records), and FFO’s approvals of expenditures to determine whether it complied with the CARES Act requirements for CvRF payments.
We used nonstatistical sampling methods for testing and therefore did not project the results of our testing to the population.
Based on the results of our testing, we determined that, during the audit period, FFO did not ensure that all subrecipient expenditures and supporting documentation met the CARES Act requirements regarding how that subrecipient spent funds it received through the CvRF. See Finding 1 for more information.
Sample of Eligible Municipalities
To determine whether FFO sampled approximately one-third of eligible municipalities across four rounds of desk reviews, we reviewed a list of the 323 municipalities that were eligible to receive funds through the CvRF-MP, which we received from A&F officials. We compared this list to the 108 desk reviews that FFO conducted during the audit period. We reviewed emails and letters notifying the municipalities of the desk review and the results of the desk review to verify that the desk reviews were performed.
We noted no exceptions in our testing; therefore, we determined that, during the audit period, FFO sampled approximately one-third of eligible municipalities across four rounds of desk reviews.
Formal Remediation Process
To determine whether FFO initiated a formal remediation process with municipalities if it identified desk reviews with findings related to CvRF compliance, we selected a random, nonstatistical sample of 20 desk reviews from the population of 80 desk reviews with findings. We reviewed the findings, recommendations, and close-out notifications (e.g., emails and letters that FFO sent to the municipalities to confirm the end of the desk review process) in our sample to ensure that FFO followed the formal remediation process. We also reviewed FFO’s email inbox tool, which is on FFO’s website and allows members of the public to submit fraud, waste, and abuse claims. We reviewed all eight fraud, waste, and abuse claims that members of the public submitted during the audit period to verify that FFO triaged each relevant claim to the appropriate agency for further investigation.
We used nonstatistical sampling methods for testing and therefore did not project the results of our testing to the population.
Based on the results of our testing, we determined that the following occurred during the audit period:
- FFO triaged all eight fraud, waste, and abuse claims to the appropriate agency for further investigation, but
- FFO did not conduct meetings as part of its formal remediation process for municipalities that had desk review findings, in accordance with FFO’s “Desk Review Process for Coronavirus Relief Fund.” See Finding 2 for more information.
Debarred Vendor List
To determine whether A&F maintained a debarred vendor list that accurately reflects vendors that should not be awarded state contracts, in accordance with Section 29F(b) of Chapter 29 of the General Laws, we took the following actions. We reviewed the debarred vendor list that the Division of Capital Asset Management and Maintenance publishes on its website (which it does on behalf of A&F), and we interviewed A&F officials about any updates the Division of Capital Asset Management and Maintenance made to this debarred vendor list during the audit period. Further, we reviewed all state debarred vendor lists published by other state agencies, to which the Division of Capital Asset Management and Maintenance links on its website.
Based on the results of our testing, we determined that, during the audit period, A&F did not maintain a consolidated debarred vendor list that contained all required information. See Finding 3 for more information.
Data Reliability Assessment
To determine the reliability of the list of the 323 municipalities that were eligible to receive funds through the CvRF-MP, which we received from A&F officials, we selected all 323 eligible municipalities and traced them to the Secretary of the Commonwealth’s list of Massachusetts municipalities (which is available to the public on the Secretary of the Commonwealth’s website) for agreement.
To determine the reliability of the list of 108 desk reviews conducted by FFO and the list of 80 municipalities that had findings resulting from those desk reviews conducted during the audit period (both of which A&F officials provided to us), first we selected a judgmental sample of 20 municipalities that had desk review findings and traced them to hardcopy close-out notifications for agreement. Second, we identified 28 municipalities that did not have desk review findings by comparing the list of 80 municipalities that had desk review findings to the population of 108 desk reviews FFO conducted. Then, we selected a judgmental sample of 20 municipalities that did not have desk review findings and traced the hardcopy close-out notifications to the list for agreement.
Based on the results of the data reliability assessment procedures described above, we determined that the information obtained for our audit period was sufficiently reliable for the purposes of our audit.
| Date published: | May 29, 2024 |
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