Audit Finds Inside Management Weaknesses at DHS

The unbiased public accounting agency KPMG LLP (KPMG) has issued an unmodified (clear) opinion on the Division of Homeland Safety’s (DHS) consolidated monetary statements. KPMG famous that the monetary statements current pretty, in all materials respects, DHS’ monetary place as of September 30, 2022 and 2021. 

KPMG issued an opposed opinion on DHS’ inside management over monetary reporting as of September 30, 2022. KPMG’s report recognized materials weaknesses in inside management referring to data expertise (IT) controls and data techniques; monetary reporting; insurance coverage liabilities; and new system obligations. A cloth weak point is a deficiency, or mixture of deficiencies, in inside management over monetary reporting, such that there’s a affordable chance {that a} materials misstatement of the entity’s monetary statements is not going to be prevented, or detected and corrected, on a well timed foundation. For instance, KPMG discovered “ineffective design, implementation, or working effectiveness of IT normal controls over IT working techniques, databases, and purposes supporting monetary reporting processes throughout DHS” in areas together with entry management and safety administration.

KPMG additionally reported “vital deficiencies” in seized and forfeited property, and grants administration in addition to situations of noncompliance with the Federal Managers’ Monetary Integrity Act of 1982 and the Federal Monetary Administration Enchancment Act of 1996. The audit discovered that DHS – notably on the Federal Emergency Administration Company – had “ineffective controls over monitoring of grant recipients; and inadequate delegation of authority documentation for controls over the evaluate of catastrophe grant obligations and deobligations”. KPMG discovered that DHS didn’t implement accountability of personnel chargeable for monitoring grant recipients and documenting the delegation of authority for the evaluate of catastrophe grant obligations and deobligations. As well as, the agency stated DHS didn’t set up management thresholds to find out the suitable scope of grant monitoring website visits and desk opinions to reduce residual danger. Among the many 19 suggestions in KPMG’s report, is a name for DHS to carry out a sturdy danger evaluation to evaluate and reduce the residual danger associated to unmonitored grants. DHS concurred with all the suggestions.

Learn the total report at OIG

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