Bemidji Regional Airport Authority

Federal Agency: U.S. Department of Transportation Federal Program Name: Airport Improvement Program Assistance Listing Number: 20.106 Federal Award Identification Number and Year: AIP 45, AIP 46, AIP 47, AIP 48, AIP 44, AIP 52, AIP 50, AIP 42, AIP 49, 2024 Pass-Through Agency: Minnesota Department of Transportation Pass-Through Numbers: AIP 45, AIP 46, AIP 47, AIP 48, AIP 44, AIP 52, AIP 50, AIP 42, AIP 49 Award Period: Year-Ended December 31, 2024 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria or Specific Requirement: Standard internal control procedures suggest that reports should have a timely review documented by someone other than the preparer. Condition: During testing of controls over reporting, it was noted the Authority did not have adequate internal controls designed to ensure that the FAA 5100-27 and FAA 5100-26 reports are reviewed for accuracy. Questioned Costs: None. Context: During testing of controls over reporting, it was noted that there were no reviews over the FAA 5100-27 and FAA 5100-26 reports. Cause: Lack of management oversight. Effect: Errors made in the reports may not be discovered. Repeat Finding: No. Recommendation: We recommend the Authority have a secondary person reviewing these reports before they are submitted to the federal agency. Views of Responsible Officials: There is no disagreement with the audit finding.

Condition During the course of our engagement, we proposed material audit adjustments that affected the Authority’s revenue, receivables, capital assets, and lease activity. Criteria Management is responsible for establishing and maintaining internal controls, including monitoring, and for the fair representation in the financial statements in accordance with GAAP. Management is responsible for the accuracy and completeness of all financial records and related information. Effect Errors in the preparation of year-end balances increases the risk related to financial statement misstatements. Cause The Authority has not established controls over year-end adjustments for reporting in accordance with GAAP. Repeat Finding 2022-004 Recommendation We recommend management implement policies and procedures to reconcile the balance sheet activity to supporting documentation.

Condition During the course of our engagement, we proposed material audit adjustments that affected the Authority’s revenue, receivables, capital assets, and lease activity. Criteria Management is responsible for establishing and maintaining internal controls, including monitoring, and for the fair representation in the financial statements in accordance with GAAP. Management is responsible for the accuracy and completeness of all financial records and related information. Effect Errors in the preparation of year-end balances increases the risk related to financial statement misstatements. Cause The Authority has not established controls over year-end adjustments for reporting in accordance with GAAP. Repeat Finding 2021-004 Recommendation We recommend management implement policies and procedures to reconcile the balance sheet activity to supporting documentation.

Condition The Authority did not have controls in place to monitor completion of reporting forms FAA Form 5100-126 and FAA Form 5100-127. At the time of the audit, the Authority was not aware that the forms were not completed. Criteria Federal guidelines require the auditee must establish and maintain effective internal controls over the federal awards that provide assurance that the entity is managing the federal awards in compliance with federal statutes, regulations, and the conditions of the federal award. Management is responsible for establishing and maintaining internal controls, including monitoring, and for the fair representation in the financial statements in accordance with GAAP. Management is responsible for the accuracy and completeness of all financial records and related information. Effect The lack of internal controls over reporting could result in the Authority reporting incorrect or incomplete information. Cause The Authority contracts the completion of the forms by a third party accountant. The Authority did not monitor the completion or accuracy of the form. Repeat Finding 2021-005 Recommendation We recommend management implement policies and procedures to monitor proper completion reporting forms.

Condition During the course of our engagement, we proposed material audit adjustments that affected the Authority’s revenue and receivables. Criteria Management is responsible for establishing and maintaining internal controls, including monitoring, and for the fair representation in the financial statements in accordance with GAAP. Management is responsible for the accuracy and completeness of all financial records and related information. Effect Errors in the preparation of year-end balances increases the risk related to financial statement misstatements. Cause The Authority has not established controls over year-end adjustments for reporting in accordance with GAAP. Repeat Finding No Recommendation We recommend management implement policies and procedures to reconcile the balance sheet activity to supporting documentation.

Condition Condition The Authority did not have controls in place to monitor completion of reporting forms FAA Form 5100-126 and FAA Form 5100-127. At the time of the audit, the Authority was not aware that the forms were not completed. Criteria Federal guidelines require the auditee must establish and maintain effective internal controls over the federal awards that provide assurance that the entity is managing the federal awards in compliance with federal statutes, regulations, and the conditions of the federal award. Management is responsible for establishing and maintaining internal controls, including monitoring, and for the fair representation in the financial statements in accordance with GAAP. Management is responsible for the accuracy and completeness of all financial records and related information. Effect The lack of internal controls over reporting could result in the Authority reporting incorrect or incomplete information. Cause The Authority contracts the completion of the forms by a third party accountant. The Authority did not monitor the completion or accuracy of the form. Repeat Finding 2020-004 Recommendation We recommend management implement policies and procedures to monitor proper completion reporting forms.

Condition The Authority did not have controls in place to monitor completion of reporting forms FAA Form 5100-126 and FAA Form 5100-127. At the time of the audit, the Authority was not aware that the forms were not completed. Criteria Federal guidelines require the auditee must establish and maintain effective internal controls over the federal awards that provide assurance that the entity is managing the federal awards in compliance with federal statutes, regulations, and the conditions of the federal award. Management is responsible for establishing and maintaining internal controls, including monitoring, and for the fair representation in the financial statements in accordance with GAAP. Management is responsible for the accuracy and completeness of all financial records and related information. Effect The lack of internal controls over reporting could result in the Authority reporting incorrect or incomplete information. Cause The Authority contracts the completion of the forms by a third party accountant. The Authority did not monitor the completion or accuracy of the form. Repeat Finding No Recommendation We recommend management implement policies and procedures to monitor proper completion reporting forms.

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