As we wrote in a story published earlier today, the New Mexico Department of Homeland Security and Emergency Management just submitted its 2016 audit to the Office of the State Auditor. That audit hasn’t yet been released publicly, and that may take weeks or months.
In the department’s 2015 audit, turned in nearly a year late, auditors found 19 significant problems and noted that “little progress” was made in passing through FEMA money to local governments and tribes.
That audit also appears to show that staff leadership was either unwilling or unable to share the information accountants needed to understand what’s happening with its finances and grants. The independent auditors, for example, couldn’t say with certainty whether the agency’s financial records were reliable, and instead had to give the Auditor’s Office what’s called a “disclaimer of opinion.”
Here are some of the recommendations auditors offered the department in the 2015 audit.
- Have a standardized filing system.
- Pay back money owed into the state’s General Fund
- Have an off-site storage plan for backup data, a contingency plan to keep data and records systems running in the event of “loss or interruptions” and create a functional disaster recovery plan.
- Inventory assets that cost more than $5,000. The agency said it didn’t have the staff to complete this annual task, which must be written up and signed off on by the secretary.
- Keep track of when checks are received and deposited.
- Comply with state statutes and track how much cash is on hand. If errors are found, make corrections before the end of the month. There’s no proof the agency did cash reconciliations in 2015.
- Submit an an annual Office of Management and Budget data collection form, which is required by the White House agency. Auditors noted that the state agency is not complying with federal award requirements and could “jeopardize future federal funding.” The agency responded by saying staff turnover was to blame.
- Have a review and approval process for per diem reimbursements of more than $1,500.
- When drawing down accounts with federal money in them, make sure the deposit forms include approval signatures.
- Don’t include “misstatements” in financial statements.
- Keep track of the money that coming in and out of accounts. Make sure those payments, going in and out, are in the correct amounts and records are made. Hold on to those records and share them with auditors.
- Comply with the Federal Funding Accountability and Transparency Act financial reporting requirements.
- Have a policy and procedures to track and identify the federal money spent on equipment.
- Monitor the activities and progress of the subgrantees that are receiving funding from FEMA through the department.
- Submit annual audits on time.