EIN: 416005752
UEI: W71GZU6KD467
Audited by: Minnesota Office of the State Auditor
Cognizant agency: 20 [Department of Transportation]
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Data as of September 2, 2026
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on June 26, 2026. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by December 26, 2026 (113 days from today).
What is a management decision? →The following exceptions was noted in expenditures tested for activities allowed or unallowed and allowable costs/cost principles: • Capital outlay expenditures were incorrectly coded as services and charges. In addition, the following exceptions were noted in the second and third quarter DHS reports tested: • An entry to remove ineligible expenditures was incorrectly recorded twice on the third quarter DHS-2550 report. • Amortization expense was not reported on the DHS-2550 and DHS-2556 reports. • MAXIS certified mail costs were incorrectly reported on the DHS-2550 reports. • Capital outlay expenditures were incorrectly reported on the DHS-2550 reports. Questioned Costs: $149,357 related to Grants to States for Medicaid; known questioned costs were determined by the calculation of quarterly amortization expense on subscription-based information technology arrangements not recorded of $148,944 and $413 of journal entries identified during review of the general ledger. Context: DHS relies on accurate identification and reporting of program costs to ensure grant funds paid to the County are for allowable federal program activities and costs and provide detailed information necessary for maintaining proper oversight over federal programs. Total Grants to States for Medicaid expenditures reported on the Schedule of Expenditures of Federal Awards (SEFA) are $16,891,964, consisting of 33,059 transactions. The sample of 40 transactions total $306,970. Total Foster Care Title IV-E expenditures reported on the SEFA are $1,964,642, consisting of 29,676 transactions. The sample of 41 Foster Care Title IV-E transactions total $115,349. The reporting population consisted of four quarterly DHS-2550 and DHS-2556. The sample was two quarterly DHS-2550 and DHS-2556 reports. The sample sizes were based on the guidance from Chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Effect: Errors in the identification and reporting of costs on the quarterly reports can impair DHS’ ability to provide required oversight over federal programs and result in the County receiving either more or less federal funds than justified based on the actual underlying activity. Cause: The County Human Services Division’s controls over the identification of allowable activities and costs and preparation and review of the quarterly reports were not sufficient to identify these errors. Additionally, staff were unaware of the impact of subscription-based information technology arrangements and related amortization. Recommendation: We recommend the Human Services Division implement controls to ensure activities allowed and allowable costs are appropriately identified and accurately reported to DHS in accordance with federal program guidance and DHS instructions. We also recommend the Human Services Division correct and resubmit reports submitted with unallowable activities or costs, costs allocated incorrectly, or activity reported incorrectly. View of Responsible Official: Concur
Show full finding ▾Hide full finding ▴2025-003 Activities Allowed or Unallowed, Allowable Costs/Cost Principles, and Reporting Prior Year Finding Number: N/A Year of Finding Origination: 2025 Type of Finding: Internal Control Over Compliance and Compliance Severity of Deficiency: Significant Deficiency and Other Matter Federal Agency: U.S. Department of Health and Human Services Programs: 93.658 Foster Care Title IV-E 93.778 Grants to States for Medicaid Award Number and Year: 2501MNFOST; 2025 2505MN5ADM; 2025 Pass-Through Agency: Minnesota Department of Human Services and Minnesota Department of Children, Youth, and Families Criteria: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Administrative program costs are submitted to the Minnesota Department of Human Services (DHS) on a quarterly basis through the DHS Income Maintenance report (DHS-2550) for the Grants to States for Medicaid program and through the DHS Social Service Fund Report (DHS-2556) for the Foster Care Title IV-E program and Grants to States for Medicaid program. DHS provides reporting instructions, including information regarding eligible and ineligible costs. Condition: The following exceptions was noted in expenditures tested for activities allowed or unallowed and allowable costs/cost principles: • Capital outlay expenditures were incorrectly coded as services and charges. In addition, the following exceptions were noted in the second and third quarter DHS reports tested: • An entry to remove ineligible expenditures was incorrectly recorded twice on the third quarter DHS-2550 report. • Amortization expense was not reported on the DHS-2550 and DHS-2556 reports. • MAXIS certified mail costs were incorrectly reported on the DHS-2550 reports. • Capital outlay expenditures were incorrectly reported on the DHS-2550 reports. Questioned Costs: $149,357 related to Grants to States for Medicaid; known questioned costs were determined by the calculation of quarterly amortization expense on subscription-based information technology arrangements not recorded of $148,944 and $413 of journal entries identified during review of the general ledger. Context: DHS relies on accurate identification and reporting of program costs to ensure grant funds paid to the County are for allowable federal program activities and costs and provide detailed information necessary for maintaining proper oversight over federal programs. Total Grants to States for Medicaid expenditures reported on the Schedule of Expenditures of Federal Awards (SEFA) are $16,891,964, consisting of 33,059 transactions. The sample of 40 transactions total $306,970. Total Foster Care Title IV-E expenditures reported on the SEFA are $1,964,642, consisting of 29,676 transactions. The sample of 41 Foster Care Title IV-E transactions total $115,349. The reporting population consisted of four quarterly DHS-2550 and DHS-2556. The sample was two quarterly DHS-2550 and DHS-2556 reports. The sample sizes were based on the guidance from Chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Effect: Errors in the identification and reporting of costs on the quarterly reports can impair DHS’ ability to provide required oversight over federal programs and result in the County receiving either more or less federal funds than justified based on the actual underlying activity. Cause: The County Human Services Division’s controls over the identification of allowable activities and costs and preparation and review of the quarterly reports were not sufficient to identify these errors. Additionally, staff were unaware of the impact of subscription-based information technology arrangements and related amortization. Recommendation: We recommend the Human Services Division implement controls to ensure activities allowed and allowable costs are appropriately identified and accurately reported to DHS in accordance with federal program guidance and DHS instructions. We also recommend the Human Services Division correct and resubmit reports submitted with unallowable activities or costs, costs allocated incorrectly, or activity reported incorrectly. View of Responsible Official: Concur
Finding Number: 2025-003 Finding Title: Activities Allowed or Unallowed, Allowable Costs/Cost Principles, and Reporting Program: 93.658 Foster Care Title IV-E, 93.778 Grants to States for Medicaid Name of Contact Person Responsible for Corrective Action: Ryan DuMond, Supervisor, Accounting Corrective Action Planned: Staff will conduct thorough reviews of all Quarterly Fiscal Memos and attachments issued by DHS to ensure that reporting requirements are fully understood and applied consistently. The County will also develop and document a comprehensive procedure for preparing the DHS‑2550 and DHS‑2556 reports, including detailed instructions for entering adjustments, processing reversing entries, reporting amortization, properly coding capital purchases, and handling MAXIS‑related costs. A mandatory review process will be implemented before submission of each report to verify accuracy and compliance with DHS guidance. As part of this review, staff will closely examine expense classifications to ensure that capital outlay expenditures are accurately coded and reported, and that all required amortization expenses are correctly included. These actions will help prevent misclassification and report errors in future submissions. Anticipated Completion Date: July 2026
FAC accepted this audit on June 25, 2025 — management decision was due December 25, 2025.
For two of the four covered transactions tested, the County did not maintain documentation of verification that the vendors were not suspended or debarred prior to entering into the covered transactions. Questioned Costs: None. Context: The County entered into a total of 16 covered transactions during the year using State Administrative Matching Grants for the Supplemental Nutrition Assistance Program funds. The vendors tested that did not have documentation of verification prior to entering the transaction were not listed as suspended or debarred on SAM.gov at the time of the audit. The sample size was based on guidance from Chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Effect: Failure to verify vendors are not suspended, debarred, or otherwise excluded prior to entering into a covered transaction may result in the County entering into a transaction with a vendor that is not authorized to provide goods and services under the grant. Cause: The County did not anticipate paying for these expenditures using federal funds and therefore did not perform or document the search for suspension and debarment. Recommendation: We recommend the County maintain documentation to demonstrate that vendors were not debarred, suspended or otherwise excluded from conducting business with the County; this documentation should be completed prior to entering into a covered transaction. View of Responsible Official: Concur
Show full finding ▾Hide full finding ▴2024-002 Suspension and Debarment Prior Year Finding Number: N/A Year of Finding Origination: 2024 Type of Finding: Internal Control Over Compliance and Compliance Severity of Deficiency: Significant Deficiency and Other Matter Federal Agency: U.S. Department of Health and Human Services Programs: 10.561 State Administrative Matching Grants for the Supplemental Nutrition Assistance Program Award Number and Year: 242MN101S2514, 242MN101S2520, 242MN127Q7503; 2024 Pass-Through Agency: Minnesota Department of Human Services Criteria: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Federal requirements prohibit non-federal entities from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Title 2 U.S. Code of Federal Regulations § 180.300 describes a required verification process. Prior to entering into the transaction, one of the following must be performed: (1) checking SAM.gov exclusions, (2) collecting a certification, or (3) adding a clause or condition to the covered transaction. Condition: For two of the four covered transactions tested, the County did not maintain documentation of verification that the vendors were not suspended or debarred prior to entering into the covered transactions. Questioned Costs: None. Context: The County entered into a total of 16 covered transactions during the year using State Administrative Matching Grants for the Supplemental Nutrition Assistance Program funds. The vendors tested that did not have documentation of verification prior to entering the transaction were not listed as suspended or debarred on SAM.gov at the time of the audit. The sample size was based on guidance from Chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Effect: Failure to verify vendors are not suspended, debarred, or otherwise excluded prior to entering into a covered transaction may result in the County entering into a transaction with a vendor that is not authorized to provide goods and services under the grant. Cause: The County did not anticipate paying for these expenditures using federal funds and therefore did not perform or document the search for suspension and debarment. Recommendation: We recommend the County maintain documentation to demonstrate that vendors were not debarred, suspended or otherwise excluded from conducting business with the County; this documentation should be completed prior to entering into a covered transaction. View of Responsible Official: Concur
Finding Number: 2024-002 Finding Title: Suspension and Debarment Program: 10.561 State Administrative Matching Grants for the Supplemental Nutrition Assistance Program Name of Contact Person Responsible for Corrective Action: Lindsey Felgate – Senior Manager, Procurement Corrective Action Planned: The Procurement Unit will continue to educate county users on required policy & procedures. This would include a refresh to our new stand-alone procurement policy, a new procedure manual explaining in detail how to procure, and supplemental documents including forms and checklists to aid in compliance. We are upgrading SharePoint (internal website) to aid in sharing procurement information. We will continue to educate on process documentation including the federal guidance listed in Title 2 U.S. Code of Federal Regulations. The County has purchased a finance/procurement system set to go live in 1/2026. The system will manage the purchase order process and we will continue to find a procurement solution for all other procurement activities. These plans will assist by moving the County from a manual environment to a more structured and standardized environment for procurement activities. Anticipated Completion Date: • Policy – 2025, current summer action • Procedures & Supplemental documents (how to’s, forms, checklists) – initial draft end of 2025 with enhancements in 2026 • SharePoint Site Refresh – year end 2025
For two of the four covered transactions tested, the County did not maintain documentation of verification that the vendors were not suspended or debarred prior to entering into the covered transactions. Questioned Costs: None. Context: The County entered into a total of 36 covered transactions during the year using COVID-19 – Coronavirus State and Local Fiscal Recovery Funds. The vendors tested that did not have documentation of verification prior to entering the transaction were not listed as suspended or debarred on SAM.gov at the time of the audit. The sample size was based on guidance from Chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Effect: Failure to verify vendors are not suspended, debarred, or otherwise excluded prior to entering into a covered transaction may result in the County entering into a transaction with a vendor that is not authorized to provide goods and services under the grant. Cause: The County informed us that, for one covered transaction, the County did not retain results of the suspension and debarment search, and, for one covered transaction, the County did not initially anticipate using federal funds to pay for the transaction. Recommendation: We recommend the County maintain documentation to demonstrate that vendors were not debarred, suspended or otherwise excluded from conducting business with the County; this documentation should be completed prior to entering into a covered transaction. View of Responsible Official: Concur
Show full finding ▾Hide full finding ▴2024-003 Suspension and Debarment Prior Year Finding Number: N/A Year of Finding Origination: 2024 Type of Finding: Internal Control Over Compliance and Compliance Severity of Deficiency: Significant Deficiency and Other Matter Federal Agency: U.S. Department of the Treasury Programs: 21.027 COVID-19 – Coronavirus State and Local Fiscal Recovery Funds Award Number and Year: SLFRP0278; 2021 Pass-Through Agency: N/A - Direct Criteria: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Federal requirements prohibit non-federal entities from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Title 2 U.S. Code of Federal Regulations § 180.300 describes a required verification process. Prior to entering into the transaction, one of the following must be performed: (1) checking SAM.gov exclusions, (2) collecting a certification, or (3) adding a clause or condition to the covered transaction. Condition: For two of the four covered transactions tested, the County did not maintain documentation of verification that the vendors were not suspended or debarred prior to entering into the covered transactions. Questioned Costs: None. Context: The County entered into a total of 36 covered transactions during the year using COVID-19 – Coronavirus State and Local Fiscal Recovery Funds. The vendors tested that did not have documentation of verification prior to entering the transaction were not listed as suspended or debarred on SAM.gov at the time of the audit. The sample size was based on guidance from Chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Effect: Failure to verify vendors are not suspended, debarred, or otherwise excluded prior to entering into a covered transaction may result in the County entering into a transaction with a vendor that is not authorized to provide goods and services under the grant. Cause: The County informed us that, for one covered transaction, the County did not retain results of the suspension and debarment search, and, for one covered transaction, the County did not initially anticipate using federal funds to pay for the transaction. Recommendation: We recommend the County maintain documentation to demonstrate that vendors were not debarred, suspended or otherwise excluded from conducting business with the County; this documentation should be completed prior to entering into a covered transaction. View of Responsible Official: Concur
Finding Number: 2024-003 Finding Title: Suspension and Debarment Program: 21.027 COVID-19 – Coronavirus State and Local Fiscal Recovery Funds Name of Contact Person Responsible for Corrective Action: Lindsey Felgate - Senior Manager, Procurement Corrective Action Planned: The Procurement Unit will continue to educate county users on required policy & procedures. This would include a refresh to our new stand-alone procurement policy, a new procedure manual explaining in detail how to procure, and supplemental documents including forms and checklists to aid in compliance. We are upgrading SharePoint (internal website) to aid in sharing procurement information. We will continue to educate on process documentation including the federal guidance listed in Title 2 U.S. Code of Federal Regulations. The County has purchased a finance/procurement system set to go live in 1/2026. The system will manage the purchase order process, and we will continue to find a procurement solution for all other procurement activities. These plans will assist by moving the County from a manual environment to a more structured and standardized environment for procurement activities. Anticipated Completion Date: • Policy – 2025, current summer action • Procedures & Supplemental documents (how to’s, forms, checklists) – initial draft end of 2025 with enhancements in 2026 • SharePoint Site Refresh – year end 2025
The Minnesota Department of Human Services (DHS) maintains the computer system, MAXIS, which is used by Anoka County to support the eligibility determination process. In the case files reviewed for eligibility, not all documentation was available, updated, or input correctly to support participant eligibility. The following exceptions were noted in the sample of 40 MAXIS case files tested: • Two case files had assets in MAXIS that were not updated to agree with supporting documentation in the case file. • One case file did not have the support for the income listed in MAXIS. • One case file did not have the support for the assets listed in MAXIS. • One case file transferred from another agency did not include the supporting documentation to verify compliance. Questioned Costs: Not applicable. The County administers the program, but the State of Minnesota pays benefits to participants in this program. Context: The State of Minnesota and the County split the eligibility determination process. Pursuant to Minnesota statutes, Anoka County performs the “intake function” needed for this program, while the state maintains the MAXIS system, which supports the eligibility determination process. Participants receive benefit payments from the state. The sample size was based on guidance from Chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Effect: The lack of updated information in MAXIS to document verification of key eligibility-determining factors increases the risk that program participants will receive benefits when they are not eligible. Cause: Program personnel entering case data into MAXIS did not ensure all required information was retained in the case file as it was entered into MAXIS. The County did not retain specific information for one participant that moved into and out of the County. Recommendation: We recommend Anoka County implement additional procedures to provide reasonable assurance that the information is properly input or updated in MAXIS and retained in the supporting case files. View of Responsible Official: Concur
Show full finding ▾Hide full finding ▴2024-004 Eligibility Prior Year Finding Number: N/A Year of Finding Origination: 2024 Type of Finding: Internal Control Over Compliance and Compliance Severity of Deficiency: Significant Deficiency and Other Matter Federal Agency: U.S. Department of Health and Human Services Program: 93.558 Temporary Assistance for Needy Families Award Number and Year: 2401MNTANF; 2024 Pass-Through Agency: Minnesota Department of Human Services Criteria: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Title 42 United States Code § 602(a)(1)(B)(iii) requires each state to create a plan for the delivery of benefits and the determination of eligibility. The Minnesota Department of Human Services’ State Plan for Temporary Assistance for Needy Families (TANF) and Minn. Stat. § 142G.10 establish the general eligibility requirements for TANF benefits which require the county to document, verify, and recertify specific information, including information relating to assets and income. Condition: The Minnesota Department of Human Services (DHS) maintains the computer system, MAXIS, which is used by Anoka County to support the eligibility determination process. In the case files reviewed for eligibility, not all documentation was available, updated, or input correctly to support participant eligibility. The following exceptions were noted in the sample of 40 MAXIS case files tested: • Two case files had assets in MAXIS that were not updated to agree with supporting documentation in the case file. • One case file did not have the support for the income listed in MAXIS. • One case file did not have the support for the assets listed in MAXIS. • One case file transferred from another agency did not include the supporting documentation to verify compliance. Questioned Costs: Not applicable. The County administers the program, but the State of Minnesota pays benefits to participants in this program. Context: The State of Minnesota and the County split the eligibility determination process. Pursuant to Minnesota statutes, Anoka County performs the “intake function” needed for this program, while the state maintains the MAXIS system, which supports the eligibility determination process. Participants receive benefit payments from the state. The sample size was based on guidance from Chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Effect: The lack of updated information in MAXIS to document verification of key eligibility-determining factors increases the risk that program participants will receive benefits when they are not eligible. Cause: Program personnel entering case data into MAXIS did not ensure all required information was retained in the case file as it was entered into MAXIS. The County did not retain specific information for one participant that moved into and out of the County. Recommendation: We recommend Anoka County implement additional procedures to provide reasonable assurance that the information is properly input or updated in MAXIS and retained in the supporting case files. View of Responsible Official: Concur
Finding Number: 2024-004 Finding Title: Eligibility Program: 93.558 Temporary Assistance for Needy Families Name of Contact Person Responsible for Corrective Action: QC Team (Lead ES): Whitney VonDeLinde, Megan Howard, Melissa Hoeft Kellie Tienter, Public Assistance Manager Jessica Leth, Economic Assistance Director Corrective Action Planned: • Training TANF employees: o Distribution of Lead ES Newsletter – monthly training communication (includes updates to forms, bulletins from the state, policy & procedural changes, and technical tips) o Supervisor’s will review mandatory verifications at unit meetings by the end of Q3 2025. o Child Support Income Budgeting Guide Includes how to budget, case noting, etc. o Move In Checklist We have made clarifying updates to this document regarding requesting a case file from a previous county if not already received. o April 2025 PSU News QC team shared information and tips from what they noticed while going through the audit • MFIP case reviews conducted by supervisors in Q2 and Q3. 15 per ES per year. • Per Hennepin County we were only transferring the last year of case file documents when clients moved from Anoka County to Hennepin County. Beginning in Q2 of 2025 Anoka County began transferring the entire case file to ensure the complete retention of case files. Anticipated Completion Date: • Completion by end of Q3 2025
FAC accepted this audit on August 9, 2024 — management decision was due February 9, 2025.
The County is not obtaining assurance that the requirements of the Davis-Bacon Act are being performed for one of two federal projects selected for testing. Questioned Costs: None. Context: The project is a joint project with the Minnesota Department of Transportation (MnDOT). The County informed us MnDOT accepted responsibility for ensuring compliance with federal prevailing wage rate standards. Currently, there is no formal agreement in place between MnDOT and Anoka County that establishes or supports who is responsible for the requirements of the program. In addition, the County is not obtaining evidence or performing a review of the prevailing wage rate work performed by MnDOT to ensure compliance with the standards. Effect: Not reviewing payroll reports submitted by contractors or subcontractors or performing other procedures to verify compliance increases the risk that inappropriate wage rates are paid. Cause: The County believes that MnDOT is obtaining and reviewing certified payroll information from contractors. Recommendation: We recommend the County begin performing a review of the prevailing wage rate requirements or obtain evidence of the work performed by MnDOT. View of Responsible Official: Concur
Show full finding ▾Hide full finding ▴2023-004 Special Tests and Provisions – Review of Prevailing Wage Reports Prior Year Finding Number: N/A Year of Finding Origination: 2023 Type of Finding: Internal Control Over Compliance and Compliance Severity of Deficiency: Significant Deficiency and Other Matter Federal Agency: U.S. Department of Transportation Program: 20.205 Highway Planning and Construction Award Number and Year: 00002; 2023 Pass-Through Agency: Minnesota Department of Transportation Criteria: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. The Davis-Bacon Act (23 U.S.C. § 113) and 29 CFR part 5 requires that contractors and subcontractors performing work on federal contracts in excess of $2,000 pay their laborers and mechanics not less than the prevailing wage rates and fringe benefits listed in the contract’s wage determination class. Each covered contractor and subcontractor must, on a weekly basis, provide a copy of the payroll reports including the information listed under the records and certified payrolls section of 29 CFR part 5. Condition: The County is not obtaining assurance that the requirements of the Davis-Bacon Act are being performed for one of two federal projects selected for testing. Questioned Costs: None. Context: The project is a joint project with the Minnesota Department of Transportation (MnDOT). The County informed us MnDOT accepted responsibility for ensuring compliance with federal prevailing wage rate standards. Currently, there is no formal agreement in place between MnDOT and Anoka County that establishes or supports who is responsible for the requirements of the program. In addition, the County is not obtaining evidence or performing a review of the prevailing wage rate work performed by MnDOT to ensure compliance with the standards. Effect: Not reviewing payroll reports submitted by contractors or subcontractors or performing other procedures to verify compliance increases the risk that inappropriate wage rates are paid. Cause: The County believes that MnDOT is obtaining and reviewing certified payroll information from contractors. Recommendation: We recommend the County begin performing a review of the prevailing wage rate requirements or obtain evidence of the work performed by MnDOT. View of Responsible Official: Concur
Finding Number: 2023-004 Finding Title: Special Tests and Provisions – Review of Prevailing Wage Reports Program: 20.205 Highway Planning and Construction Name of Contact Person Responsible for Corrective Action: Joe MacPherson – Chief Officer, Transportation & County Engineer, Highway Corrective Action Planned: On projects, such as the Ramsey Gateway Improvement Project (Project # SP 002-596-026) where the County contracts with the State related to the provision of construction project management services, the County Engineer and their team will request a prevailing wage report from the construction administration/engineering team at the Minnesota Department of Transportation (MnDOT) prior to certifying all contract payments. The report will include a summary of the prevailing wage reports that have been submitted/reviewed and describe any issues or concerns that were found and addressed. Anticipated Completion Date: This procedure will be implemented immediately (as of July 3, 2024).
Anoka County has not submitted subaward information in the FSRS as required by the FFATA for the Community Development Block Grant. Questioned Costs: None. Context: A subaward is any award provided by a pass-through entity to a subrecipient for the subrecipient to administer part of a federal award received by the pass-through entity. This issue was noted during the audit of the Community Development Block Grant; however, it impacts federal programs County-wide. Effect: Anoka County is not in compliance with FFATA reporting. Cause: The County missed HUD notifications that FFATA needed to be implemented. Recommendation: We recommend Anoka County implement procedures to complete reports required by FFATA. In addition, we recommend Anoka County work with the federal government on how best to correct reporting. View of Responsible Official: Concur
Show full finding ▾Hide full finding ▴2023-005 Reporting – Federal Funding Accountability and Transparency Act (FFATA) Prior Year Finding Number: N/A Year of Finding Origination: 2023 Type of Finding: Internal Control Over Compliance and Compliance Severity of Deficiency: Significant Deficiency and Other Matter Federal Agency: U.S. Housing and Urban Development Program: 14.218 Community Development Block Grants/Entitlement Grants Criteria: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Under the requirements of the Federal Funding Accountability and Transparency Act (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, that are codified in Title 2 Code of Federal Regulations, Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Condition: Anoka County has not submitted subaward information in the FSRS as required by the FFATA for the Community Development Block Grant. Questioned Costs: None. Context: A subaward is any award provided by a pass-through entity to a subrecipient for the subrecipient to administer part of a federal award received by the pass-through entity. This issue was noted during the audit of the Community Development Block Grant; however, it impacts federal programs County-wide. Effect: Anoka County is not in compliance with FFATA reporting. Cause: The County missed HUD notifications that FFATA needed to be implemented. Recommendation: We recommend Anoka County implement procedures to complete reports required by FFATA. In addition, we recommend Anoka County work with the federal government on how best to correct reporting. View of Responsible Official: Concur
Finding Number: 2023-005 Finding Title: Reporting – Federal Funding Accountability and Transparency Act (FFATA) Program: 14.218 Community Development Block Grants/Entitlement Grants Name of Contact Person Responsible for Corrective Action: Renee Sande – Manager, Community Development Corrective Action Planned: Anoka County Community Development staff is implementing procedures to ensure the completion of reports required by Federal Funding Accountability and Transparency Act (FFATA). As part of the procedures, staff will establish and maintain effective internal controls over the federal award to ensure compliance with federal statutes and regulations, along with the terms and conditions of the federal award. Community Development will consult with the U.S. Department of Housing and Urban Development (HUD) on how best to correct reporting. Moving forward, Federal Funding Accountability and Transparency Act (FFATA) reporting will be completed promptly within the required 30 days for applicable subawards of $30,000 or more. This task has been added to the annual contracting process and to assist with tracking, this item has been added to the Community Development Block Grant (CDBG) sub-recipient check list. Anticipated Completion Date: By July 31, 2024, Community Development staff will add required PY 2023 and PY 2022 CDBG recipients of grants or cooperative agreements to the Federal Subaward Reporting System (FSRS) as required for subawards of $30,000 or more per the Federal Funding Accountability and Transparency Act (FFATA).
FAC accepted this audit on September 5, 2023 — management decision was due March 5, 2024.
During testing of internal controls over payroll processing, the County was unable to provide evidence of assigned supervisory review or approval of timesheets for payroll processed during fourth quarter. For each major federal program audit, the fourth quarter payroll expenditures selected for testing contained no evidence of supervisory review or approval. Context: Beginning September 24, 2022, with the implementation of the new time and attendance and payroll system, Workday, Human Resources began mass approving timesheets. Once posted, the mass approval overrides all other approvals in the system making it impossible to identify which timesheets were reviewed and approved by assigned supervisors and which were not. The sample sizes were based on the guidance from Chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Effect: The lack of assigned supervisory review and approval of timesheets has created errors in payroll transactions resulting in an increased number of corrections and supplemental pay needing to be processed. Cause: Human Resources began mass approving timesheets during the implementation to Workday as a way to speed up the processing of payroll. At the same time the County implemented Workday, Human Resources experienced a large amount of staff turnover. The increase in staff turnover combined with implementing Workday, caused significant internal controls to be overlooked. Recommendation: We recommend the County discontinue the practice of mass approving timesheets and design and implement procedures that requires each timesheet to be reviewed and approved within the system by the assigned supervisors. View of Responsible Official: Acknowledge
Show full finding ▾Hide full finding ▴2022-003 Internal Controls over Payroll Prior Year Finding Number: N/A Repeat Finding Since: N/A Type of Finding: Internal Control Over Compliance Severity of Deficiency: Material Weakness Federal Agency: U.S. Department of the Treasury and U.S. Department of Health and Human Services Program: 21.027 COVID-19 ? Coronavirus State and Local Fiscal Recovery Funds; 93.563 Child Support Enforcement; 93.778 Medical Assistance Program Award Number and Year: Assistance Listing Number Award Number Year 21.027 Federal Direct 2022 93.563 2201MNCEST 2201MNCSES 2022 93.778 2205MN5ADM 2205MN5MAP 2022 Pass-Through Agency: Assistance Listing Number Pass-Through Agency 21.027 Not applicable 93.563 Minnesota Department of Human Services 93.778 Minnesota Department of Human Services Questioned Costs: None Criteria: Management is responsible for designing and implementing internal controls over accounting processes, including payroll. To obtain greater assurance that errors or fraud in payroll are prevented, detected, and corrected in a timely manner, payroll disbursements made to employees should be supported by appropriate supervisory authorization. Furthermore, Title 2 U.S. Code of Federal Regulations ? 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: During testing of internal controls over payroll processing, the County was unable to provide evidence of assigned supervisory review or approval of timesheets for payroll processed during fourth quarter. For each major federal program audit, the fourth quarter payroll expenditures selected for testing contained no evidence of supervisory review or approval. Context: Beginning September 24, 2022, with the implementation of the new time and attendance and payroll system, Workday, Human Resources began mass approving timesheets. Once posted, the mass approval overrides all other approvals in the system making it impossible to identify which timesheets were reviewed and approved by assigned supervisors and which were not. The sample sizes were based on the guidance from Chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Effect: The lack of assigned supervisory review and approval of timesheets has created errors in payroll transactions resulting in an increased number of corrections and supplemental pay needing to be processed. Cause: Human Resources began mass approving timesheets during the implementation to Workday as a way to speed up the processing of payroll. At the same time the County implemented Workday, Human Resources experienced a large amount of staff turnover. The increase in staff turnover combined with implementing Workday, caused significant internal controls to be overlooked. Recommendation: We recommend the County discontinue the practice of mass approving timesheets and design and implement procedures that requires each timesheet to be reviewed and approved within the system by the assigned supervisors. View of Responsible Official: Acknowledge
Finding Number: 2022-003 Finding Title: Internal Controls over Payroll Name of Contact Person Responsible for Corrective Action: Cory Kampf - CFO - Finance and Central Services Emily Wilson - Supervisor, Accounting - Finance and Central Services Corrective Action Planned: The Mass Approval Process does not overwrite the individual time sheet approval. The reports showing this were not available at the time of the audit and are being developed to resolve this issue. Discontinuing the Mass Approval may result in the need to process additional supplemental payrolls for those individuals that were not paid on the regular payday. We continue to develop additional training and tools for supervisors to help them with their responsibilities for approving time. Also, we are looking at developing procedures around supplemental payrolls with the plan to minimize the need for them. Anticipated Completion Date: December 31, 2023
Federal revenue offsets from the State and Local Fiscal Recovery Funds (ALN 21.027) were omitted from all quarterly DHS-2550 and DHS-2556 reports submitted to DHS during 2022. This resulted in an understatement of federal revenue offsets of $197,934 on the DHS-2550 and $752,717 on the DHS-2556 reports for the year. Questioned Costs: $950,651 Context: The DHS relies on accurate reporting of program costs to ensure that resulting grant funds paid to the County are for applicable federal program activities/costs and provide detailed information necessary for maintaining proper oversight over federal programs. Effect: Errors in the submission of costs on the quarterly reports can impair the DHS?s ability to provide required oversight over federal programs and can result in the County receiving either more or less federal funds than allowed based on the actual underlying activity. Cause: The County neglected to move the State and Local Fiscal Recovery Funds (ALN 21.027) revenue from the General Fund to the Human Services fund at the time the expenditures occurred resulting in an adjustment for financial reporting and omission of the federal revenue offset reported to DHS. Recommendation: We recommend Anoka County implement controls that ensure all DHS reports include federal revenue offsets and are completed accurately in accordance with DHS guidance. View of Responsible Official: Acknowledge
Show full finding ▾Hide full finding ▴2022-005 Allowable Costs/Cost Principles and Reporting Prior Year Finding Number: N/A Repeat Finding Since: N/A Type of Finding: Internal Control Over Compliance and Compliance Severity of Deficiency: Material Weakness and Modified Opinion Federal Agency: U.S. Department of Health and Human Services Program: 93.778 Medical Assistance Program Award Number and Year: 2205MN5ADM, 2205MN5MAP; 2022 Pass-Through Agency: Minnesota Department of Human Services Criteria: Title 2 U.S. Code of Federal Regulations ? 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. For County federal awards received from the Minnesota Department of Human Services (DHS), internal control should be established and maintained to provide assurance that program reports submitted to DHS are completed accurately and in accordance with report instructions. As part of the County?s reporting requirements for the Medical Assistance Program, the County submits to DHS the quarterly Social Service Fund Report (DHS-2556) and the Income Maintenance Quarterly Expense Report (DHS-2550). Condition: Federal revenue offsets from the State and Local Fiscal Recovery Funds (ALN 21.027) were omitted from all quarterly DHS-2550 and DHS-2556 reports submitted to DHS during 2022. This resulted in an understatement of federal revenue offsets of $197,934 on the DHS-2550 and $752,717 on the DHS-2556 reports for the year. Questioned Costs: $950,651 Context: The DHS relies on accurate reporting of program costs to ensure that resulting grant funds paid to the County are for applicable federal program activities/costs and provide detailed information necessary for maintaining proper oversight over federal programs. Effect: Errors in the submission of costs on the quarterly reports can impair the DHS?s ability to provide required oversight over federal programs and can result in the County receiving either more or less federal funds than allowed based on the actual underlying activity. Cause: The County neglected to move the State and Local Fiscal Recovery Funds (ALN 21.027) revenue from the General Fund to the Human Services fund at the time the expenditures occurred resulting in an adjustment for financial reporting and omission of the federal revenue offset reported to DHS. Recommendation: We recommend Anoka County implement controls that ensure all DHS reports include federal revenue offsets and are completed accurately in accordance with DHS guidance. View of Responsible Official: Acknowledge
Finding Number: 2022-005 Finding Title: Allowable Costs/Cost Principles and Reporting Program: Medical Assistance Program 93.778 Name of Contact Person Responsible for Corrective Action: Nicole Hegge - Sr. Manager, Accounting - Finance and Central Services Corrective Action Planned: In order to appropriately report the revenue offset that may impact federal programs, we have updated our quarterly process ensuring that any federal revenue offsets are included in the appropriate fund and report. In some instances, this may still require the County to file amendments to federal reports; however, they will be completed no later than eight weeks following the end of the quarter. Anticipated Completion Date: December 31, 2023
FAC accepted this audit on August 8, 2022 — management decision was due February 8, 2023.
For three covered transactions tested, the verification for suspended or debarred vendors was not performed before entering into the covered transaction. For two procurements tested that exceeded the simplified threshold, documentation of a cost or price analysis was not available. Questioned Costs: None. Context: The thresholds used for testing were 1) micro purchase (under $10,000), 2) small purchase ($10,000 to under $250,000), and 3) over simplified acquisition (over $250,000). The suspension and debarment threshold is $25,000. A sample of two vendors over the simplified acquisition threshold across all three grants were tested (also tested for suspension/debarment). A sample of three vendors within the small purchase threshold across all three grants were tested (also tested for suspension/debarment). A sample of three vendors within the micro purchase threshold across all three grants were tested. The sample size was based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Effect: The County is not in complete compliance with federal grant requirements. Cause: The County indicated the deviations occurred because the County is operating in a manual environment with decentralization, and there is a learning curve with the procurement standards. Additionally, the County has found it difficult to comply when federal reimbursement was not anticipated at the time of procurement. For these reasons, the County indicated there is not consistency in documenting debarment checks and cost/price analysis to show compliance. Recommendation: We recommend the County maintain documentation to demonstrate that vendors were not debarred, suspended, or otherwise excluded from conducting business with the County; this documentation should be completed prior to entering into a covered transaction. We further recommend the County maintain documentation to support compliance with the cost or price analysis provisions contained in Title 2 U.S. Code of Federal Regulations ? 200.323. View of Responsible Official: Concur
Show full finding ▾Hide full finding ▴2021-001 Procurement, Suspension, and Debarment Prior Year Finding Number: N/A Repeat Finding Since: N/A Type of Finding: Internal Control Over Compliance and Compliance Severity of Deficiency: Significant Deficiency and Other Matter Federal Agency: U.S. Department of Agriculture and U.S. Department of Treasury Program: 10.557 Special Supplemental Nutrition Program for Women, Infants, and Children (WIC); 10.561 State Administrative Matching Grants for the Supplemental Nutrition Assistance Program (SNAP); and 21.027 State and Local Fiscal Recovery Funds Award Number and Year: Assistance Listing Number Award Number Year 10.557 202MN004W1003 2021 10.561 212MN101S2514, 212MN127Q7503, 212MN101S2520 2021 21.027 Not Provided Pass-Through Agency: Assistance Listing Number Pass-Through Agency 10.557 Minnesota Department of Health 10.561 Minnesota Department of Human Services 21.027 Not applicable Criteria: Title 2 U.S. Code of Federal Regulations ? 200.318(i) states that the County must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to the following: rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. The County must follow further federal guidance over full and open competition as provided in Title 2 U.S. Code of Federal Regulations ? 200.319; cost or price analysis provided in Title 2 U.S. Code of Federal Regulations ? 200.323; and verifying debarment, suspension, and exclusions as provided in Title 2 U.S. Code of Federal Regulations ?? 180.300, 200.213, and 200.318(h). Condition: For three covered transactions tested, the verification for suspended or debarred vendors was not performed before entering into the covered transaction. For two procurements tested that exceeded the simplified threshold, documentation of a cost or price analysis was not available. Questioned Costs: None. Context: The thresholds used for testing were 1) micro purchase (under $10,000), 2) small purchase ($10,000 to under $250,000), and 3) over simplified acquisition (over $250,000). The suspension and debarment threshold is $25,000. A sample of two vendors over the simplified acquisition threshold across all three grants were tested (also tested for suspension/debarment). A sample of three vendors within the small purchase threshold across all three grants were tested (also tested for suspension/debarment). A sample of three vendors within the micro purchase threshold across all three grants were tested. The sample size was based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Effect: The County is not in complete compliance with federal grant requirements. Cause: The County indicated the deviations occurred because the County is operating in a manual environment with decentralization, and there is a learning curve with the procurement standards. Additionally, the County has found it difficult to comply when federal reimbursement was not anticipated at the time of procurement. For these reasons, the County indicated there is not consistency in documenting debarment checks and cost/price analysis to show compliance. Recommendation: We recommend the County maintain documentation to demonstrate that vendors were not debarred, suspended, or otherwise excluded from conducting business with the County; this documentation should be completed prior to entering into a covered transaction. We further recommend the County maintain documentation to support compliance with the cost or price analysis provisions contained in Title 2 U.S. Code of Federal Regulations ? 200.323. View of Responsible Official: Concur
Finding Number: 2021-001 Finding Title: Procurement, Suspension, and Debarment Program: Special Supplemental Nutrition Program for Women, Infants, and Children (Assistance Listing No. 10.557); State Administrative Matching Grants for the Supplemental Nutrition Assistance Program (Assistance Listing No. 10.561); and State and Local Fiscal Recovery Funds (Assistance Listing No. 21.027) Name of Contact Person Responsible for Corrective Action: Lindsey Felgate, Sr. Manager, Procurement Corrective Action Planned: We continue to operate in a decentralized procurement environment. We continue to work with all departments. The Procurement Unit will continue to educate County users on procurement, suspension, and debarment procedures. This would include documentation of the process and what we discovered. The education also includes the rationale used to determine the method of procurement and federal guidance listed in Title 2 U.S. Codes of Federal Regulations. Plans to assist the County in education are in process. These include seeking and acquiring a new finance/procurement system, a more comprehensive and educational procurement procedure manual, and a formal training model strategy for all County users of procurement. These plans will assist by moving the County from a manual environment to a more structured environment. Anticipated Completion Date: December 31, 2022
FAC accepted this audit on July 26, 2021 — management decision was due January 26, 2022.
FAC accepted this audit on July 9, 2020 — management decision was due January 9, 2021.
FAC accepted this audit on July 1, 2019 — management decision was due January 1, 2020.
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2017-003
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FAC accepted this audit on July 18, 2018 — management decision was due January 18, 2019.
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FAC accepted this audit on July 5, 2017 — management decision was due January 5, 2018.
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2015-001
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