- -

OF 

INSPECTOR GENERAL 

U.S. DEPARTMENT OF THE INTERIOR 

AUDIT

U.S. Fish and Wildlife Service Grants 

Awarded to the State of Rhode Island, 

Department of Environmental Management, 

Division of Fish and Wildlife, From July 1, 

2016, Through June 30, 2018, Under the 

Wildlife and Sport Fish Restoration Program

In recognition of Secretarial Order No. 3380, we are providing estimated costs 

associated with certain work products. Applying a formula involving prior salary 

and benefit expenses, we estimate the cost of preparing this report to be 

$228,000. 

Report No.: 2019-WR-007 December 2020
 

 

 

 

 

 

 

 

OFFICE OF 

INSPECTOR GENERAL 

U.S. DEPARTMENT OF THE INTERIOR 

Memorandum 

To: Aurelia Skipwith 

Director, U.S. Fish and Wildlife Service 

From: Michael P. Colombo 

Regional Manager, Western Region 

Subject: Final Audit Report – U.S. Fish and Wildlife Service Grants Awarded to the State 

of Rhode Island, Department of Environmental Management, Division of Fish and 

Wildlife, From July 1, 2016, Through June 30, 2018, Under the Wildlife and Sport 

Fish Restoration Program 

Report No. 2019-WR-007 

This report presents the results of our audit of costs claimed by the Rhode Island 

Department of Environmental Management, Division of Fish and Wildlife (Division), under 

grants awarded by the U.S. Fish and Wildlife Service (FWS) through the Wildlife and Sport Fish 

Restoration Program. We conducted this audit to determine whether the Division used grant 

funds and State hunting and fishing license revenue for allowable fish and wildlife activities and

complied with applicable laws and regulations, FWS guidelines, and grant agreements. The audit 

period included claims totaling $42.9 million on 34 grants that were open during the State fiscal 

years that ended June 30, 2017, and June 30, 2018. 

We determined that the State did not ensure that grant funds and State hunting and 

fishing license revenue were used for allowable fish and wildlife activities and complied with 

applicable laws and regulations, FWS guidelines, and grant agreements. We found deficiencies 

in internal controls resulting in our five findings of (1) insufficient controls over grant-specific 

data, (2) improper drawdown support, (3) inadequate real property management, (4) inadequate 

equipment inventory management, and (5) inaccurate license certifications. 

We provided a draft of this report to the FWS. The FWS concurred with our 11 

recommendations and will work with the Division to implement corrective actions. The full 

responses from the FWS and the Division are included in Appendix 3. We list the status of the

recommendations in Appendix 4. 

Please provide us with a corrective action plan based on our recommendations by March 

29, 2021. The plan should provide information on actions taken or planned to address each 

recommendation, as well as target dates and titles of the officials responsible for implementation. 

Please send your response to aie_reports@doioig.gov. 

If you have any questions regarding this report, please me at 916-978-6199. 

Office of Audits, Inspections, and Evaluations | Sacramento, CA 
The legislation creating the Office of Inspector General requires that we report to 

Congress semiannually on all audit reports issued, actions taken to implement our 

recommendations, and recommendations that have not been implemented. 

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Contents 

Introduction......................................................................................................................................1 

Objective ....................................................................................................................................1 

Background................................................................................................................................1 

Results of Audit ...............................................................................................................................2 

Insufficient Controls Over Grant-Specific Data ........................................................................2 

Improper Drawdown Support ....................................................................................................5 

Inadequate Real Property Management .....................................................................................6 

Inadequate Equipment Inventory Management .........................................................................7 

Inaccurate License Certifications...............................................................................................9 

Recommendations Summary .........................................................................................................11 

Appendix 1: Scope and Methodology............................................................................................13 

Scope........................................................................................................................................13 

Methodology............................................................................................................................13 

Prior Audit Coverage ...............................................................................................................14 

Appendix 2: Sites Visited ..............................................................................................................15 

Appendix 3: Responses to Draft Report ........................................................................................16 

Appendix 4: Status of Recommendations......................................................................................20 
 

 

 

 

 

 

 

 

 

Introduction 

Objective 

In June 2016, we entered into an intra-agency agreement with the U.S. Fish and Wildlife Service 

(FWS) to conduct audits of State agencies receiving grant funds under the Wildlife and Sport 

Fish Restoration Program (WSFR). These audits fulfill the FWS’ statutory responsibility to audit 

State agencies’ use of these grant funds. 

We conducted this audit to determine whether the Rhode Island Department of Environmental 

Management, Division of Fish and Wildlife (Division), used grant funds and State hunting and 

fishing license revenue for allowable fish and wildlife activities and complied with applicable 

laws and regulations, FWS guidelines, and grant agreements. 

See Appendix 1 for details about our scope and methodology. See Appendix 2 for sites we 

visited. 

Background 

The FWS provides grants to States1 through WSFR for the conservation, restoration, and 

management of wildlife and sport fish resources. WSFR was established by the PittmanRobertson Wildlife Restoration Act and the Dingell-Johnson Sport Fish Restoration Act.2 The 

Acts and related Federal regulations allow the FWS to reimburse grantees a portion of eligible 

costs incurred under WSFR grants—up to 75 percent for States and the District of Columbia and 

100 percent for Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, and the Northern 

Mariana Islands. The reimbursement amount is called the Federal share. The Acts require that 

hunting and fishing license revenue be used only for the administration of State fish and wildlife 

agencies. In addition, Federal regulations require States to account for any income earned from 

grant-funded activities and to spend this income before requesting grant reimbursements. 

1 The Wildlife and Sport Fish Restoration Program defines the term “State” to include the District of Columbia, the 

Commonwealth of Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, and the Commonwealth of the Northern 

Mariana Islands. 

2 Formally known, respectively, as the Federal Aid in Wildlife Restoration Act, 16 U.S.C. § 669, as amended, and the Federal 

Aid in Sport Fish Restoration Act, 16 U.S.C. § 777, as amended. 

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Results of Audit 

We determined that the Division did not ensure that grant funds and State hunting and fishing 

license revenue were used for allowable fish and wildlife activities and did not comply with 

applicable laws and regulations, FWS guidelines, and grant agreements. 

Specifically, we found the following control deficiencies: 

• Insufficient Controls Over Grant-Specific Data. The Division did not establish 

sufficient accounting system controls for grant-specific data. 

• Improper Drawdown Support. The Division was unable to provide documentation to 

demonstrate that it incurred the State’s required matching share of costs before it drew 

down the Federal share of expenditures. 

• Inadequate Real Property Management. The Division did not perform land 

reconciliation or adequately address encroachments. 

• Inadequate Equipment Inventory Management. The Division did not follow 

established equipment management procedures. 

• Inaccurate License Certifications. The Division included duplicate license holders in its 

license certification. 

Insufficient Controls Over Grant-Specific Data 

The Division did not establish sufficient accounting system controls over grant-specific data. 

Without these controls, it could not provide support or an audit trail to demonstrate that it 

incurred the required Federal and State share of expenditures before it requested grant 

reimbursements. The Division claimed expenditures totaling $42.9 million, of which 

$31.8 million was reported as the Federal share and $10.9 million was reported as the State’s 

matching share of costs. 

The Division used grant-specific accounts and cost centers to record and report its Federal and 

State shares of grant expenditures. We found, however, that 55 percent of the Federal and State 

shares of all grant expenditures on the 34 grants open during State fiscal years (SFYs) 2017 and 

2018 either did not have a cost center or had zeros where there should be a grant-specific code 

for the cost center. 

The Code of Federal Regulations (2 C.F.R. § 200.302(a)) requires that States’ financial 

management systems be sufficient to (1) prepare reports required by general and programspecific terms and conditions and (2) trace funds to a level of expenditures adequate to establish 

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that such funds have been used according to Federal statutes, regulations, and the terms and 

conditions of the Federal award. 

The State of Rhode Island requires all State agencies to use the Rhode Island Financial 

Accounting Network System (RIFANS) as its centralized financial, payroll, and procurement 

systems (35 R.I. General Laws § 35-6-1). RIFANS was implemented on July 1, 2006, for 

financial reporting, budgetary control, and vendor payment processing. 

RIFANS contains a cost accounting system for payroll and procurement, and a financial 

accounting system for grant expenditures, including payroll. These systems both contained grantspecific data, but the information was not sufficient for a traceable audit trail or as support for 

Federal and State shares of expenditures as some of the data was incomplete and the two 

accounting systems were not integrated. 

For example, payroll in the financial accounting system, along with journal entries, transfers, 

batch transactions, and audit fees, and payroll transactions only had account numbers, with cost 

centers being blank or populated with zeros rather than with grant-specific codes. As these 

expenditures only contained an account number, they were unreconcilable to a specific grant 

because many grants used the same account number. We did note that the cost accounting system 

within RIFANS contained the Division’s grant-specific payroll, which included the grantspecific accounts and cost centers, allowing reconciliation to a specific grant, but because the 

two systems were not integrated, the payroll information in the cost accounting system cannot be 

automatically reconciled with the rest of the grant related expenditures in the financial 

accounting system. Therefore, the 55 percent of the Federal and State share of grant expenditures 

recorded in RIFANS could not be reconciled to a specific grant. 

We did note that within the financial accounting system, grant expenditures related to specific 

purchases tended to have correct, grant-specific account numbers and cost centers, allowing 

reconciliations to a specific grant. 

A Division official told us that the entries in the financial accounting system not tied to a specific 

purchase were missing cost centers because it required manual entry. We were also told that the 

systems are not integrated because the financial system requires updating. A Division official 

also said that more than 3,000 cost centers have been used for grant activity and many inactive 

cost centers have not been closed, which complicates the process. 

Management is responsible for establishing and maintaining internal controls over financial 

reporting to ensure accurate and complete reporting of transactions in accordance with generally 

accepted accounting principles. This responsibility includes well-designed financial systems that 

support internal controls over financial reporting. As the expenditures in the financial accounting 

system could not be reconciled to a specific grant, and the cost accounting system could not 

interface with the financial accounting system, the Division did not meet the Federal 

requirements for financial management systems. As a result, we could not ascertain and ensure 

that WSFR resources were used solely for authorized purposes and that the Division did not 

receive excess reimbursement. 

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The use of financial and cost accounting systems for grant-specific data that cannot interface 

with each other is complex, weakens controls over financial reporting, and creates an 

administrative burden, including a high volume of manual accounting entries and the use of 

estimates during the drawdown and grant closure process. 

The State’s 2018 single audit for the SFY ending June 30, 2018, also reported multiple findings 

in the area of controls over financial reporting, with which we concur. Referring to the 

Division’s use of separate financials system components within RIFANS, single audit Finding 

No. 2018-001 states, “When separate software solutions are used to accomplish multiple 

objectives, the responsibility of ensuring data connectivity and integration falls more to the 

user.” In addition, the finding noted that recording transactions in two accounting systems would 

be less challenging if the accounting systems were integrated. 

The single audit report further noted in Finding No. 2018-014, “From an overall Statewide 

perspective, controls over financial reporting are ineffective to ensure that all Federal 

expenditures are reimbursable and Federal revenue is recognized appropriately.” In the same 

finding, the auditor also noted: 

The State’s RIFANS accounting system does not meet the State’s needs in three 

important and interrelated areas—time reporting/payroll, grants management, and 

cost allocation—all functionalities that are integral to management of Federal 

programs. These functions are currently performed independent of RIFANS and 

generally through multiple departmental systems—most of which are duplicative 

and utilize old and sometimes unsupported technology. 

The Division could not provide a traceable audit trail to demonstrate that it incurred the required 

Federal and State shares of grant expenditures because its cost and financial accounting systems 

within RIFANS were not integrated and contained incomplete data. As a result, we could not 

ascertain and ensure that WSFR resources were used solely for authorized purposes and that the 

Division did not receive excess reimbursement. 

Recommendation 

We recommend that the FWS: 

1. Require the Division to establish and implement accounting system controls in

accordance with Federal regulations that ensure that its financial management

systems are sufficient to (a) prepare reports required by general and programspecific terms and conditions and (b) trace funds to a level of expenditures

adequate to establish that such funds have been used according to Federal

statutes, regulations, and the terms and conditions of Federal awards

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Improper Drawdown Support 

The Division was unable to provide adequate supporting documentation to demonstrate that it 

incurred the State’s required matching share of costs on WSFR grants before it drew down 

(requested reimbursement for) the Federal share of expenditures. Specifically, the Division could 

not identify in its general ledger the individual expenditures that it claimed as the basis for its 

drawdown totals. For example, we reviewed drawdowns for Grant Nos. F17AF0192 and 

F16AF00935, and there was not an adequate method or audit trail to identify expenditures 

applied to the drawdowns in the Division’s general ledger. 

Federal regulation (2 C.F.R. § 200.302(a)) requires that States’ and other non-Federal entities’ 

financial management systems must be sufficient to (1) prepare reports required by general and 

program-specific terms and conditions and (2) trace funds to a level of expenditures adequate to 

establish that such funds have been used according to the Federal statutes, regulations, and the 

terms and conditions of the Federal award. 

Federal regulation (2 C.F.R. § 200.305(b)(1)) also states that the timing and amount of advance 

payments must be as close as is administratively feasible to the actual disbursements by the nonFederal entity for direct program or project costs and the proportionate share of any allowable 

indirect costs. The non-Federal entity must make timely payment to contractors in accordance 

with the contract provisions. 

In addition, Federal regulation (2 C.F.R. § 200.305(4)) states that the Federal awarding agency or 

pass-through entity must reimburse the non-Federal entity for its actual cash disbursements. 

Further, the Division’s Federal Assistance Grant Coordination Policy and Procedural Manual 

states that the Office of Management Services accountant and the Division’s Federal assistance 

coordinator together will: 

• Track all expenditures, revenue, program income, and match for individual active grants

• Review all copies of Federal Financial Reports (SF-425s) for accuracy

This finding is related to our finding above in that the Division used two accounting systems 

within RIFANS—cost and financial—that contained incomplete or erroneous data and were not 

integrated. The use of the two financial systems resulted in the Division being unable to provide 

a traceable audit trail and being unable to identify the actual expenditures that it claimed as the 

basis for its drawdown amounts. 

Division officials told us that instead of using the actual expenditures, they use estimates that 

sum to the total requested drawdown amount. Officials further stated, however, that the actual 

expenditures are later captured with the manual drawdown reconciliation process. We found that 

this reconciliation process occurred sporadically over the grant term. We also found that 

drawdowns for grants were not done on a monthly basis and also occurred sporadically 

throughout the year. 

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By not using actual expenditures that can be matched to the drawdown requests, the Division 

may be inaccurately reporting grant claims and receiving excess reimbursement. 

Recommendations 

We recommend that the FWS: 

2. Work with the Division to establish and implement policy and procedures to

ensure that drawdowns are adequately supported and comply with Federal

statutes, regulations, and the terms and conditions of Federal awards

3. Require the Division to submit detailed accounting system expenditure support

with future annual and final grant claims

Inadequate Real Property Management 

The Division was unable to demonstrate that it maintained sufficient control over WSFR grantfunded real property to ensure that it served the purpose for which acquired throughout its useful 

life. Specifically, the Division did not complete a reconciliation of State records to the FWS 

records of grant-funded lands and did not adequately addressed instances of encroachments on 

grant-funded lands. 

The FWS and the Division agreed that a reconciliation had not been completed. Division 

officials also told us that they knew of four encroachments on grant-funded lands that they did 

not do enough to address: 

• Simmons Mill Fort Church, Grant No. FW-13-L-1, Simmons Mill Pond Management

Area, Little Compton and Tiverton, RI—The Division reported that there were two

tractor trailers parked just over the line (i.e., on the Management Area).

• Deep Hole, Grant No. F-25-L-1, South Kingstown, RI—The Division reported that there

was a possible lawn and walkway encroachment, but needs to do a survey to confirm and

determine how to address it.

• Rockville/Sargant, Grant No. FW-4-L-6, Rockville Management Area, Hopkinton, RI—

The Division reported a shed, building materials, and other debris were left on the

property.

• Simons Mill Orton, Grant No. FW-13-L-1, Simmons Mill Pond Management Area, Little

Compton and Tiverton, RI—The Division reported that there are old crops on the

Management Area and they need to address the problem.

We also found that the Division failed to maintain its property located in Roundtop Management 

Area. The property was the former regional headquarters and was purchased with grant funds. 

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During our site visit to this property, we found that the building was falling apart and infested 

with rodents that were eating away the ceilings and other areas of the property. In addition, the 

property was full of trash, documents, and unused equipment. 

Federal regulation (50 C.F.R. § 80.90(f)) requires the Division to maintain control of all assets 

acquired under the grant to ensure that they serve the purpose for which acquired throughout 

their useful life. In addition, the FWS Director reiterated land management requirements to 

WSFR participants in a March 29, 2007 letter. The letter requested that each State maintain a real 

property management system that includes a comprehensive inventory of lands to ensure that its 

inventory is accurate and complete. 

The Division did not maintain sufficient control over its real property because it did not develop 

and implement sufficient policies and procedures for properly managing and monitoring real 

property. Division officials also stated that they are in the process of conducting the 

reconciliation of State and FWS grant-funded land records. Without sufficient policies and 

without complete reconciliation, the Division cannot ensure that its lands acquired under WSFR 

grants are being used for their intended purposes. 

Recommendations 

We recommend that the FWS: 

4. Work with the Division to complete a reconciliation of its land records to the

FWS’ records of lands purchased with Federal awards and resolve any acreage

differences identified

5. Require the Division to resolve the identified encroachments on land

purchased with Federal awards

6. Require the Division to establish a monitoring process to inspect the use of

lands purchased with Federal awards to ensure compliance with Federal

statutes, regulations, and the terms and conditions of Federal awards

7. Require the Division to certify that real property purchased with Federal

awards is being used for its intended purposes

Inadequate Equipment Inventory Management 

The Division did not manage equipment inventory to control equipment purchased with grant 

funds and license revenues as required. Specifically, the Division’s inventory was inaccurate, 

and it had not been reconciled to the Rhode Island Department of Administration’s centralized 

equipment database. Based on our review of the Division’s equipment inventory spreadsheets, 

we identified missing, mismarked, and untagged equipment at various field offices, wildlife 

management areas, and the Division’s headquarters. We also found multiple inaccuracies such as 

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assets with no funding source, wrong tag numbers and descriptions, and assets located onsite but 

not included in the inventory record. 

Federal regulation (2 C.F.R. § 200.313(b)) requires State agencies to use, manage, and dispose of 

equipment in accordance with State laws and procedures. 

The Rhode Island Department of Administration’s Fixed Assets Control and Tracking System 

(FACTS) Policies and Procedures Manual (revised June 2013, page 26) requires State agencies 

to conduct a physical inventory of equipment every 2 years and to inventory assets costing 

$5,000 or more, as well as all vehicles; laptop computers; and lawn, landscape, and grounds 

maintenance equipment costing $500 or more. 

In addition, the Division’s Property Management and Inventory Procedures (dated 

September 13, 2010) requires it to (1) inventory all equipment that is valued at $500 or more 

and that will last more than 1 year, (2) enter each eligible item and specific identifying and 

funding information into the inventory (Excel) spreadsheets, (3) obtain the Department’s FACTS 

system inventory of Division assets and reconcile it with the Division’s inventory once a year, 

and (4) perform a physical inventory every 2 years. 

In our two prior audits (2009 and 2015), we found that the Division did not always perform the 

required physical inventories and that equipment records were inaccurate.3 Based on a review of 

prior audit resolution documentation for these audits, we found that the FWS considered these 

findings resolved and implemented. Based on our current review, however, we believe additional 

controls are needed to ensure that property acquired with grant funds or license revenues is 

controlled, inventoried, and used for its intended purpose. 

The Division did not adequately manage equipment inventory because it did not follow 

established equipment inventory management procedures to control equipment purchased with 

grant funds and license revenues. Specifically, the Division did not complete its required annual 

inventory and did not reconcile its inventory to the Department of Administration’s inventory as 

required annually. We also found that the Department of Administration did not conduct the 

required biannual agency equipment inventory for 2017.4

According to officials, the Division did not follow equipment management policy requiring it to 

reconcile its equipment inventory database to the Department of Administration’s FACTS 

database because it has no formal process for reconciliation. These officials also told us that the 

comparison to the FACTS system is cumbersome and they have limited staff. Finally, the 

Division had not performed a physical inventory since 2015 and so did not have an updated 

inventory to reconcile to the most recent FACTS database. 

Without accurate records and asset management practices, the Division cannot ensure 

accountability and control of equipment purchased with WSFR funds and license revenues. 

3 Report No. R-GR-FWS-0009-2014, issued March 10, 2015; and Report No. R-GR-FWS-0013-2008, issued July 22, 2009. 4 According to a Department of Administration official its Fixed Assets and Control and Tracking System (FACTS) Policy and 

Procedure Manual, which was revised in June 2018, requires that State agency (equipment) physical inventories shall be 

conducted every 4 years. 

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Recommendations 

We recommend that the FWS: 

8. Require the Division to perform the required physical equipment inventories

and reconcile its equipment inventory annually to the State’s official equipment

management system

9. Require the Division to update and implement equipment management policy

and procedures to ensure that equipment purchased with Federal awards or

license revenues is used for its acquired purposes through its useful life

Inaccurate License Certifications 

The Division offers daily and annual hunting and fishing licenses and combination licenses 

(both hunting and fishing) to residents and nonresidents. Some individuals purchase more than 

one type of hunting or fishing license in the same year or buy multiple licenses of the same 

type. All States provide a certified count of unique paid hunting and fishing license holders to 

the FWS each year. In the certification, States must remove duplicate licenses. The FWS uses 

the license certifications and the Wildlife and Sport Fish Restoration Acts’ apportionment 

formulas to determine the amount of WSFR funds to be apportioned to each State. The 

Division included duplicate license holders in its annual license certifications to the FWS. 

Based on our review of the Division’s two most recent license certifications years (2015 and 

2016), and the support provided, we determined that the certifications the Division submitted to 

the FWS did not eliminate license holders who purchased more than one license (duplicate 

license holders). A Division official agreed that duplicate licenses that occurred in both the 

freshwater and saltwater fishing licenses were not eliminated. 

Federal regulations (50 C.F.R. §§ 80.31(a) and (b)) require that each State provide information 

about the unique number of people holding paid hunting and/or fishing licenses in the State in 

the preceding year to the FWS. Regulations (50 C.F.R. § 80.31(c)) prohibit an individual who 

holds more than one license to hunt or fish from being counted more than once as a hunting or 

fishing license holder. Regulations (50 C.F.R. § 80.31(b)(3)) also provide that the Division is 

responsible for eliminating multiple counts of the same individuals when certifying the number 

of paid license holders. 

In a prior audit (Report No. R-GR-FWS-0013-2008) issued July 22, 2009, we found that the 

Division’s license certification included free licenses and that the Division did not have a system 

in place to identify and eliminate duplicate license holders. To address this issue, on March 22, 

2010, the Division submitted revised license certifications and procedures developed to ensure 

compliance with license certification requirements. The FWS accepted the revised certifications 

and procedures and considered the recommendations resolved and implemented. 

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Division procedures, developed to address a prior audit license certification issue, were to 

ensure the elimination of duplicate license holders from annual license certification counts 

submitted to the FWS. 

The Division did not follow established policies and procedures to identify and remove duplicate 

license holders. A Division official also stated that the licensing system was divided between a 

paper system and an electronic system, and the paper system was very cumbersome and was 

impossible to reconcile with the electronic system given the task and the availability of staff time 

to perform such a task. We noted that although the Division switched to an electronic system in 

2017 and no longer needed to reconcile between the electronic system and paper systems, the 

electronic system did not have internal controls or procedures that eliminated the inclusion of 

duplicate licenses in its certifications. The Division’s management also confirmed that they do 

not have a system in place to identify and eliminate free or duplicates licenses. 

Rhode Island is considered a “minimum State,” meaning it receives set percentages of annual 

WSFR apportionments.5 Therefore, the overstatement may not result in the Division receiving 

excess WSFR funds, but the FWS requested we report this issue to ensure accurate certifications 

for the apportionment of resources to all WSFR participants. 

Recommendations 

We recommend that the FWS: 

10.Require the Division to develop policies and implement procedures that ensure

its license certifications do not include duplicate license holders

11.Require the Division to submit supporting documentation with future license

certifications that demonstrate compliance with State and Federal

requirements.

5 The State of Rhode Island receives half of 1 percent of Wildlife Restoration funds and 1 percent of Sport Fish Restoration funds 

annually. 

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Recommendations Summary 

We provided a draft of this report to the FWS for review. The FWS concurred with all 11 

recommendations and will work with the Division to implement corrective actions (see 

Appendix 3 for the full text of the FWS’ and the Division’s responses). Based on the responses 

to our draft report, we consider Recommendation 2 resolved and implemented and 

Recommendations 1 and 3 – 11 resolved but not implemented (see Appendix 4 for the status of 

each recommendation). The Division updated its drawdown policy on July 1, 2020, which meets 

the intent of and resolves Recommendation 2. 

We recommend that the FWS: 

1. Require the Division to establish and implement accounting system controls in 

accordance with Federal regulations that ensure that its financial management systems 

are sufficient to (a) prepare reports required by general and program-specific terms and 

conditions and (b) trace funds to a level of expenditures adequate to establish that such 

funds have been used according to Federal statutes, regulations, and the terms and 

conditions of Federal awards 

2. Work with the Division to establish and implement policy and procedures to ensure that 

drawdowns are adequately supported and comply with Federal statutes, regulations, and 

the terms and conditions of Federal awards 

3. Require the Division to submit detailed accounting system expenditure support with 

future annual and final grant claims 

4. Work with the Division to complete a reconciliation of its grant funded land records to 

the FWS’ records of lands purchased with Federal awards and resolve any acreage 

differences identified 

5. Require the Division to resolve the identified encroachments on land purchased with 

Federal awards 

6. Require the Division to establish a monitoring process to inspect the use lands purchased 

with Federal awards to ensure compliance with Federal statutes, regulations, and the 

terms and conditions of Federal awards 

7. Require the Division to certify that real property purchased with Federal awards is being 

used for its intended purposes 

8. Require the Division to perform the required physical equipment inventories and 

reconcile its equipment inventory annually to the State’s official equipment management 

system 

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9. Require the Division to update and implement equipment management policy and

procedures to ensure that equipment purchased with Federal awards or license revenues is

used for its acquired purposes through its useful life

10. Require the Division to (a) develop policies and implement procedures that ensure its

license certifications do not include duplicate license holders and (b) submit supporting

documentation with future license certifications that demonstrate compliance with State

and Federal requirements

11. Require the Division to submit supporting documentation with future license

certifications that demonstrate compliance with State and Federal requirements

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Appendix 1: Scope and Methodology 

Scope 

We audited the Rhode Island Department of Environmental Management’s Division of Fish and 

Wildlife (Division’s) use of grants awarded by the U.S. Fish and Wildlife Service (FWS) under 

the Wildlife and Sport Fish Restoration Program (WSFR). The audit period included claims 

totaling $42.9 million on 34 grants that were open during the State fiscal years (SFYs) that ended 

June 30, 2017, and June 30, 2018. 

Methodology 

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. 

We obtained an understanding of internal controls. We determined that the State’s control 

activities were significant to the audit objectives. We tested the operation and reliability of 

internal controls over activities related to our audit objective. Our tests and procedures included: 

• Examining the evidence that supports selected expenditures charged to the grants by the

Division

• Reviewing transactions related to purchases, direct costs, drawdowns of reimbursements,

in-kind contributions, and program income

• Interviewing Division employees

• Inspecting equipment and other property

• Determining whether the Division used hunting and fishing license revenue for the

administration of fish and wildlife program activities

• Determining whether the State passed required legislation assenting to the provisions of

the Pittman-Robertson Wildlife Restoration Act and the Dingell-Johnson Sport Fish

Restoration Act

• Evaluating State policies and procedures for assessing risk and monitoring subawards

• Visiting sites throughout the State (see Appendix 2 for a list of sites visited)

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Based on the results of our initial assessments, we assigned a level of risk and selected a 

judgmental sample of transactions for testing. We used auditor judgment and considered risk 

levels relative to other audit work performed to determine the degree of testing performed in 

each area. Our sample selections were not generated using statistical sampling, and therefore we 

did not project the results of our tests to the total population of transactions. We found 

deficiencies in internal controls resulting in our five findings of (1) insufficient controls over 

grant-specific data, (2) improper drawdown support, (3) inadequate real property management, 

(4) inadequate equipment inventory management, and (5) inaccurate license certifications.

This audit supplements, but does not replace, the audits required by the Single Audit Act 

Amendments of 1996. Single audit reports address controls over Statewide financial reporting, 

with emphasis on major programs. Our report focuses on the administration of Rhode Island’s 

fish and wildlife agency, and that agency’s management of WSFR resources and license revenue. 

Rhode Island provided computer-generated data from its official accounting system and from 

informal management information and reporting systems. We tested the data by sampling 

expenditures and verifying them against WSFR reports and source documents such as purchase 

orders, invoices, and payroll documentation. Our testing was limited to the data sampled. 

Therefore, we did not assess the reliability of the accounting system as a whole. 

Prior Audit Coverage 

OIG Audit Reports 

We reviewed our last two audits of costs claimed by the Division on WSFR grants.6 We 

followed up on the 10 recommendations from these reports and found that the U.S. Department 

of the Interior’s Office of Policy, Management and Budget considered all 10 recommendations 

as resolved and implemented. 

State Audit Reports 

We reviewed the Rhode Island single audit reports for SFYs 2017 and 2018 to identify control 

deficiencies or other reportable conditions that affect WSFR. In those reports, the Schedule of 

Expenditures of Federal Awards indicated $15.5 million (combined) in Federal expenditures 

related to WSFR, but did not include any findings directly related to WSFR, which was not 

deemed a major program for Statewide audit purposes. Both reports noted a significant 

deficiency in grant accounting for other programs, and we considered this as a risk indicator 

when we prepared our audit procedures and tests. See our current findings, “Insufficient Controls 

Over Grant-Specific Data” and “Improper Drawdown Support,” for specifics. 

6 U.S. Fish and Wildlife Service Wildlife and Sport Fish Restoration Program Grants Awarded to the State of Rhode Island, 

Department of Environmental Management, Division of Fish and Wildlife, From July 1,2005, Through June 30, 2007 (Report 

No. R-GR-FWS-0013-2008), dated July 27, 2009. 

U.S. Fish and Wildlife Service Wildlife and Sport Fish Restoration Program Grants Awarded to the State of Rhode Island, 

Department of Environmental Management, From July 1, 2011, Through June 30, 2013 (Report No. R-GR-FWS-0009-2014), 

dated March 10, 2015. 

14 
Headquarters Providence 

Field Offices Great Swamp Field Headquarters 

Round Top Field Headquarters 

Fisheries Offices Fish and Wildlife Education Center 

Marine 

Carolina 

Fish Hatcheries Lafayette 

Perryville 

Carolina Trout Pond 

Boating Access Facilities Charleston Beach Way 

Great Swamp Management Area 

Arcadia 

Big River 

Black Hut 

Buck Hill 

Burlingame 

Carolina 

Durfee Hill 

Wildlife Management Areas Eight Rod Farm 

George Washington 

Great Swamp 

Patience Island 

Prudence Island 

Rockville 

Round Top 

Simmons Mill Pond 

Appendix 2: Sites Visited 

15 
 

 

Appendix 3: Responses to Draft Report 

The responses to our draft report from the U.S. Fish and Wildlife Service and the Rhode Island 

Department of Environmental Management, Division of Fish and Wildlife, follow on page 17. 

16 
 

 

 

 

 

 

 

 

 

TAKE PRIOE®iF::<~ 

INAMERICA~~ 

United States Department of the Interior

FISH AND WILDLIFE SERVICE

300 Westgate Center Drive

Hadley, MA 01035-9589

September 14, 2020

In Reply Refer To:

FWS/WSFR – North Atlantic - Appalachian Region 

Michael P. Colombo, Regional Manager, Western Region

U.S. Department of the Interior

Office of Inspector General

Dear Mr. Colombo:

Attached is the State of Rhode Island, Department of Environmental Management, Division of 

Fish and Wildlife’s (Division), response to the Office of Inspector General’s Draft Audit Report

No. 2019-WR-007. In addition, to the Division’s response they have provided additional

supporting documentation including a copy of RIDEM Drawdown Policy in response to 

recommendation #2 in the draft audit report and a query document from the Rhode Island 

Interactive, the company that runs their licensing system in response to recommendation #10. 

The query document outlines the methods used to query the data in the system to produce the

numbers provided in the most recent license certification. The Service has confirmed with the

Division these are the only comments that they have on this Draft Report.

The Service concurs with the auditors recommendations and has reviewed and accepted the

Division’s response. 

The Service will work closely with the Division staff in developing and implementing a

corrective action plan that will resolve all of the findings and recommendations. 

Sincerely

Colleen E. Sculley

Chief, Division of Wildlife

 and Sport Fish Restoration 

17
Rhode Island Department of Environmental Management 

Division of Fish and Wildlife 401 222-4 700 x 2301 

235 Promenade Street Fax 401 222-2444 

Providence, RI 02908 TDD 401 222-4462 

September l 0, 2020 

Shelley DiBona 

Grants Fiscal Officer, Division of Wildlife & Sport Fish Restoration 

U.S. Fish & Wildlife Service 

300 Westgate Center Drive 

Hadley, MA 01035 

Dear Ms. DiBona: 

Thank you very much for providing Rhode Island with the Draft Audit Report for the audit of 

U.S. Fish and Wildlife Service Grants awarded to the State of Rhode Island, Division of Fish and 

Wildlife. We greatly appreciate the information provided and the opportunity to comment on the 

report. While overall we concur with the findings of the Office of Inspector General, there are a 

few comments we would like to have on record. There were five findings in the report. 

The first finding was regarding insufficient controls over grant-specific data. We agree that the 

accounting systems are cumbersome and requires significant manual accounting. The Office of 

Management Services (OMS) is implementing new policies and has created standard tools to 

identify both the federal and matching expenses tied to any single drawdown. All new grant 

awards will have a unique line sequence thereby eliminating the ambiguity of expenses that post 

without a cost center and reducing manual accounting. The Department of Environmental 

Management (DEM) is required to use statewide financial, payroll and procurement systems and 

DEM does not have control over the development and integration of a new system. We will work 

with the regional office to assure that the tools we develop adequately address any concerns. 

The second finding addressed improper drawdown support. It is the policy within OMS that no 

federal funds are drawn prior to reconciliation and all reconciliations are to be completed no less 

than monthly. The audit covered a period of time prior to the implementation of these policies 

and OMS has since addressed these controls. 

The third finding regarding inadequate real property management is accurate, however as the 

report states, we are currently in the process of reconciling the land records. Additionally, we are 

in the process of developing a plan to address encroachments and establish a lands monitoring 

program. Clarification is requested as to what will be required for the certification that real 

property purchased under these awards is being used for its intended purpose. 

The fourth finding was for inadequate equipment inventory management, with which we concur. 

To address this issue, that has been an audit finding in the past we will be incorporating inventory 

management into the real property monitoring plan and will address all of these together. 

Finally, the fifth finding was regarding license certification. We agree that, for the time period 

that was under consideration duplicate licenses were not eliminated for the reasons given in the 

report. At the time we had a paper license system and were unable to determine which individuals 

had both a freshwater and saltwater license, and these were counted twice. We have always 

18
eliminated free licenses, so that part is not accurate. Currently, we have determined that our new 

online licensing system is capable of being queried to determine licensed individuals, which will 

eliminate the duplication of one person having more than one fishing license. This was the case 

when the auditors were present, but not for the time period of the audit. 

The Department appreciates the time and consideration that the Office of Inspector General has 

provided during the audit and the efforts of the WSFR Regional Office assisting with this process. 

We look forward to working with the USFWS WSFR Regional Office to develop acceptable 

solutions to these issues that benefit both the Service and Rhode Island so that we can continue 

the good conservation work that is the foundation of what we do. 

8@~A-fo/( 

Catherine A. Sparks 

Assistant Director for Natural Resources 

19
Recommendation Status Action Required 

2 Resolved and implemented No action is required. 

 

 

 

1, 3 –11 

Resolved but not 

implemented: 

U.S. Fish and Wildlife Service 

(FWS) regional officials 

concurred with these 

recommendations and will 

work with staff from the 

Rhode Island Department of 

Environmental Management, 

Division of Fish and Wildlife to 

develop and implement a 

corrective action plan. 

 

 

 

 

 

 

 

 

 

 

 

 

 

Complete a corrective action 

plan that includes information 

on actions taken or planned to 

address the recommendations, 

target dates and titles of the 

officials responsible for 

implementation, and 

verification that FWS 

headquarters officials reviewed 

and approved the actions the 

State has taken or planned. 

We will refer the 

recommendations not 

implemented at the end of 90 

days (after March 29, 2021) 

to the Assistant Secretary for 

Policy, Management and 

Budget to track 

implementation. 

Appendix 4: Status of Recommendations 

20 
Report Fraud, Waste,

and Mismanagement

Fraud, waste, and mismanagement in

Government concern everyone: Office 

of Inspector General staff, departmental 

employees, and the general public. We 

actively solicit allegations of any 

inefficient and wasteful practices, fraud, 

and mismanagement related to 

departmental or Insular Area programs 

and operations. You can report 

allegations to us in several ways.

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Office of Inspector General

Mail Stop 4428 MIB 

1849 C Street, NW. 

Washington, DC 20240