City of Wisconsin Rapids

Federal Agency: U.S. Department of the Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Award Identification Number and Year: Unknown Award Period: March 3, 2021 – December 31, 2026 Type of Finding: Significant Deficiency in Internal Control over Compliance Compliance Requirement: Procurement, Suspension & Debarment Criteria: Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. Condition: The City entered into procurement transactions that exceeded the covered threshold and while the city did perform a review of suspension and debarment status, it did not document that the review was completed prior to approving the procurement transaction in accordance with 2 CFR section 180.220. Questioned Costs: None Context: The City did not document the date of the suspension and debarment review for two transactions that exceeded the covered threshold. Cause: The City did not have procedures in place to help ensure that the date of review was documented. Effect: Certain vendors could be used that are considered suspended or debarred by the federal government resulting in noncompliance. Repeat Finding: No Recommendation: We recommend the City revise its policies and procedures to ensure that documentation as to the date of the review of suspension and debarment status is maintained with the procurement history of each transaction that requires such a search. Views of Responsible Officials: There is no disagreement with the finding.

Type of Finding: Significant deficiency in internal control over compliance Compliance Requirement: Reporting Criteria: Grant claims filed by the City to the various granting agencies must be accurate, reconcile to the City general ledger system, and for cost-reimbursement grants, represent costs incurred. Internal controls should be designed and implemented to prevent and detect errors in the data reported on the grant claims. Segregation of duties is an internal control intended to prevent or decrease the occurrence of errors or intentional fraud. Segregation of duties ensures that no single employee has control over all phases of a transaction. Context: While performing audit procedures, it was noted that the grant claims submitted for reimbursement in our sample had not been reviewed by someone other than the preparer in accordance with City policy. Condition: There was no review of the reports and claims for reimbursement by someone other than the preparer. Accordingly, this does not allow for a proper segregation of duties for internal control purposes over reporting compliance requirements. Questioned costs: None. Cause: Limited personnel trained on grant reporting and internal controls over grant reporting. Effect: There could be the possibility that the client would over- or under-report certain items for reimbursement. Recommendation: We recommend that the City utilize other means of reviewing the reports such as utilizing personnel in the city finance office or accounting personnel in other city departments review the claims prior to submitting them to the granting agency for reimbursement. We also recommend the city review its grant management policy with all department heads on an annual basis. View of responsible officials: There is no disagreement with the audit finding.

Type of Finding: Significant deficiency in internal control over compliance Compliance Requirement: Suspension and Debarment, Other Matter Criteria: Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. ?Covered transactions? include contracts for goods and services awarded under a nonprocurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. Context: For the two contracts tested in our sample, the City didn't have documentation to support that these vendors were not suspended or disbarred from receiving federal funds. Condition: The City had not implemented formal internal controls related to ensuring suspension and debarment status was verified prior to entering into contract with vendors. Questioned costs: None. Cause: The City missed identifying that suspension and debarment was not included in their uniform guidance policy. Effect: City could contract with a vendor that has been suspended or debarred from receiving federal funds. Recommendation: We recommend that the City review its policies and procedures related to suspension and debarment compliance and implement controls to ensure suspension and debarment requirements are followed. We recommend the City use sam.gov or the ELPS listing to review clients at the beginning of the year or before a transaction is incurred in accordance with Uniform Guidance requirements. View of responsible officials: There is no disagreement with the audit finding.

2019-001 Segregation of Duties ? Grant Reporting Type of Finding: Material weakness in internal control over compliance Compliance Requirement: Reporting Criteria: Grant claims filed by the City to the various granting agencies must be accurate, reconcile to the City general ledger system, and for cost-reimbursement grants, represent costs incurred. Internal controls should be designed and implemented to prevent and detect errors in the data reported on the grant claims. Segregation of duties is an internal control intended to prevent or decrease the occurrence of errors or intentional fraud. Segregation of duties ensures that no single employee has control over all phases of a transaction. Context: While performing audit procedures, it was noted that not all of the grant claims submitted for reimbursement in our sample had been reviewed by someone other than the preparer in accordance with City policy. Condition: There was no review of the reports and claims for reimbursement by someone other than the preparer. Accordingly, this does not allow for a proper segregation of duties for internal control purposes over reporting compliance requirements. Questioned costs: None. Cause: Limited personnel trained on grant reporting and internal controls over grant reporting. Effect: There could be the possibility that the client would over- or under-report certain items for reimbursement. Recommendation: We recommend that the City utilize other means of reviewing the reports such as utilizing personnel in the city finance office or accounting personnel in other city departments review the claims prior to submitting them to the granting agency for reimbursement. We also recommend the city review its grant management policy with all department heads on an annual basis. View of responsible officials: There is no disagreement with the audit finding.

2019-002 Grant Expenditure Recording Type of Finding: Uniform Guidance compliance finding Significant deficiency in internal control over compliance Compliance Requirement: Reporting Criteria: 2 CFR 200.302 requires that "The financial management system of each non-Federal entity must provide for the following: (1) Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. Federal program and Federal award identification must include, as applicable, the CFDA title and number, Federal award identification number and year, name of the Federal agency, and name of the pass-through entity, if any." Context: While performing audit procedures, it was noted that project codes and unique expenditure account numbers were not used for all costs in accordance with City policy. Payroll and job-costing expenditures were tracked by a job code in the job cost module in the accounting system but general disbursements were not. Condition: The City's general ledger did not specifically identify accounts where federal expenditures were recorded. Questioned costs: None. Cause: This disaster grant didn't have the normal application process so the city missed setting up the account coding in accordance with City policy. Effect: There could be the possibility that the client would over- or under-report certain items for reimbursement. Recommendation: We recommend the City review its processes and implement controls to address non-routine grant situations to ensure that account coding is properly set up and any expenditures incurred prior to the set up are reclassified to the unique expenditure account. We also recommend the city review its grant management policy with all department heads on an annual basis. View of responsible officials: There is no disagreement with the audit finding.