Audit: Questioned costs, monitoring federal money plagues Commerce Department

Eleven findings and $8.5 million in questioned costs were found in the 2024 Statewide Single Audit report, the North Carolina auditor says.

Auditor Dave Boliek, a first-term Republican, said most were tied to the Department of Commerce.

“These results have been delivered to the governor, agency managers, and the North Carolina General Assembly,” Boliek said in a release. “Moving forward, our office will be following up on these findings to make sure tax dollars are being managed responsibly with an eye on returning a positive investment to all North Carolinians.”

The report is through the most recent fiscal year ending June 30.

The auditor’s office said the Commerce Department “incorrectly used $8.5 million of Unemployment Insurance administration funds by charging expenditures to the wrong timeframe allowed by each award.”

Lee Lilley is the secretary leading the department, an appointment of first-term Democratic Gov. Josh Stein. He succeeded Machelle Baker Sanders, the appointment of two-term Democratic Gov. Roy Cooper in February 2021.

Inadequate monitoring of federal funds was also discovered in the department, and in the Department of Health and Human Services.

The Commerce Department, the audit says, didn’t adequately monitor $55 million designated for employment and training programs. The Health Department was subpar on $106.5 million designated for providing substance abuse prevention, treatment and recovering services and addressing the opioid abuse crisis.

Dr. Devdutta Sangvai is the secretary leading the Health Department, an appointment of Stein. He succeeded Kody Kinsley, the first openly gay cabinet secretary in state history and an appointee of Cooper three years earlier.