Sneak Preview: Auditors Discuss CARES Act Oversight Challenges
(The following was excerpted from a recent article in the Single Audit Information Service.) A panel of governmental auditing officials recently addressed numerous challenges they face in advising their clients about and preparing to audit the more than $3 trillion in federal emergency response funding allocated under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) (Pub. L. 116-136) and other supplemental funding legislation, while explaining steps they are taking to respond to these challenges. The panel, speaking to attendees at the National Intergovernmental Audit Forum’s Biennial Forum, represented auditors from the federal, state, local and tribal governmental levels.
California State Auditor Elaine Howle said that her state is facing multiple oversight challenges. The state received $68 billion in federal CARES Act funding, much of which was passed through to subrecipients, and Howle’s office has been conducting risk assessments to determine which programs to audit. To do this, it is comparing the amount of emergency funding that programs received statewide compared to each program’s usual amount of funding. For example, she explained that one laboratory testing research program that previously received $10 million annually and was considered low-risk has received $546 million under the CARES Act and is now deemed high-risk.
Howle added that her office is also evaluating state agency outreach efforts, assessing whether they are educating state residents who now may be eligible for certain benefits under CARES Act programs. It also is reviewing whether agencies understand and are modifying program eligibility requirements that have changed under certain CARES Act programs, such as the Unemployment Insurance program.
The California State Auditor’s office has not yet begun conducting audit work on the CARES Act programs in the state, but plans to begin soon. Howle explained that because the state governor is providing emergency funding quickly to “hot spots” within the state, her office must remain aware that funding is going to these communities, assess the risks in these locations and modify its plan for where to conduct audits going forward. “We’ve got to take a look at our risk analysis determination to identify where we need to audit and who we need to be in contact with on the local level,” she said. “We have to be able to quickly shift gears, and be flexible and fluid in our approach [toward] looking at some of the dollars.”
Howle said her office is currently focusing on evaluating criteria to use for audits. The Government Auditing Standards defines “criteria” as “laws, regulations, contracts, grant agreements, standards, measures, expected performance, defined business practices, and benchmarks against which performance is compared or evaluated.”
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