EIN: 596000304
UEI: DFEKLNMEZMK3
Data as of August 25, 2026
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on June 12, 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 12, 2026 (108 days from today).
What is a management decision? →Review of quarterly reports and reimbursement requests were not documented by the City before submittal. Cause of condition: The department at the City that is responsible for managing the grant does not have a process in place to document their review of quarterly reports and reimbursement requests submitted to the Florida Division of Emergency Management. Potential effect of condition: Reports submitted to the Florida Division of Emergency Management may be incomplete, include errors, or be submitted late. Perspective: The department of the City that manages the grant did not have a documented process in place for the review and approval of quarterly reports and reimbursement requests prior to submittal to the grantor. Questioned costs: None noted. Reported finding is a deficiency in internal control. Recommendation: The City should develop procedures to ensure documented management review of all reporting prior to submission to grantors. Management’s Response: The City updated its control process to ensure that reports prepared are reviewed by City staff or management prior to being submitted to grantor.
Show full finding ▾Hide full finding ▴GRANT REPORTING U.S. Department of Homeland Security ALN 97.036 – Disaster Grants – Public Assistance Contract No. PA-B3-06-74-01-312 and PA-DR-06-74-01-166 Passed through the Florida Division of Emergency Management 2025 Funding Criteria: 2 CFR 200.303 requires non-federal entities to establish and maintain effective internal controls. Reports and reimbursement requests should be subject to independent review for the full fiscal year to verify completeness, validity and timeliness of submission. The grant agreement requires quarterly progress reports to be filed with the pass-through entity, Florida Division of Emergency Management. Condition: Review of quarterly reports and reimbursement requests were not documented by the City before submittal. Cause of condition: The department at the City that is responsible for managing the grant does not have a process in place to document their review of quarterly reports and reimbursement requests submitted to the Florida Division of Emergency Management. Potential effect of condition: Reports submitted to the Florida Division of Emergency Management may be incomplete, include errors, or be submitted late. Perspective: The department of the City that manages the grant did not have a documented process in place for the review and approval of quarterly reports and reimbursement requests prior to submittal to the grantor. Questioned costs: None noted. Reported finding is a deficiency in internal control. Recommendation: The City should develop procedures to ensure documented management review of all reporting prior to submission to grantors. Management’s Response: The City updated its control process to ensure that reports prepared are reviewed by City staff or management prior to being submitted to grantor.
CORRECTIVE ACTION PLAN May 21, 2026 The City of Daytona Beach, Florida respectfully submits the following corrective action plan for the year ended September 30, 2025. Name and address of independent public accounting firm: Carr, Riggs & Ingram, L.L.C. 7506 Lynx Way, Suite 201 Melbourne, Florida 32940 Audit Period: Fiscal Year October 1, 2024 – September 30, 2025 The finding from the Schedule of Findings and Questioned Costs is discussed below. The finding number corresponds to the number assigned in the schedule. Section III–Federal Award Findings and Questioned Costs 2025-001 GRANT REPORTING U.S. Department of Homeland Security ALN 97.036 – Disaster Grants – Public Assistance Contract No. PA-B3-06-74-01-312 and PA-DR-06-74-01-166 Passed through the Florida Division of Emergency Management 2025 Funding Criteria: 2 CFR 200.303 requires non-federal entities to establish and maintain effective internal controls. Reports and reimbursement requests should be subject to independent review for the full fiscal year to verify completeness, validity and timeliness of submission. The grant agreement requires quarterly progress reports to be filed with the pass-through entity, Florida Division of Emergency Management. Condition: Review of quarterly reports and reimbursement requests were not documented by the City before submittal. Cause of condition: The department at the City that is responsible for managing the grant does not have a process in place to document their review of quarterly reports and reimbursement requests submitted to the Florida Division of Emergency Management. Potential effect of condition: Reports submitted to the Florida Division of Emergency Management may be incomplete, include errors, or be submitted late. Perspective: The department of the City that manages the grant did not have a documented process in place for the review and approval of quarterly reports and reimbursement requests prior to submittal to the grantor. Questioned costs: None noted. Reported finding is a deficiency in internal control. Recommendation: The City should develop procedures to ensure documented management review of all reporting prior to submission to grantors. Management’s Response: The City updated its control process to ensure that reports prepared are reviewed by City staff or management prior to being submitted to grantor. Responsible Parties: David Waller, Public Works Director, Natalia Eckroth, CFO and Christine Aiken, Assistant Finance Director. Anticipated Completion: March 31, 2026.
FAC accepted this audit on June 16, 2025 — management decision was due December 16, 2025.
Review of quarterly reports was not always documented by City officials before submittal by their third party consultant. Cause of condition: The department at the City that is responsible for managing the grant did not originally have a process in place to document their review of progress reports submitted to the Florida Department of State by their third party consultant. Potential effect of condition: Reports submitted to the Florida Department of State may be incomplete, include errors, or be submitted late. Perspective: After this condition was reported as a finding for the fiscal year ending September 30, 2023, the City’s department that is responsible for managing the grant implemented a review process, but it was not in place for the full fiscal year 2024. Questioned costs: None. Recommendation: The City’s department responsible for the grant should continue to perform the review process that was put in place late in fiscal year 2024. Management’s Response:. The City updated its control process to ensure that reports prepared by third-party consultant are reviewed by City staff prior to being submitted to the grantor.
Show full finding ▾Hide full finding ▴GRANT REPORTING U.S. Department of Treasury ALN 21.027 – Coronavirus State and Local Fiscal Recovery Funds Contract No. 23.saa.900.46 (2023) Passed through the Florida Department of State 2024 Funding Repeat Finding Criteria: 2 CFR 200.303 requires non-federal entities to establish and maintain effective internal controls. Reports and reimbursement requests should be subject to independent review for the full fiscal year to verify completeness, validity and timeliness of submission. The grant agreement requires quarterly progress reports to be filed with the pass through entity, Florida Department of State. Condition: Review of quarterly reports was not always documented by City officials before submittal by their third party consultant. Cause of condition: The department at the City that is responsible for managing the grant did not originally have a process in place to document their review of progress reports submitted to the Florida Department of State by their third party consultant. Potential effect of condition: Reports submitted to the Florida Department of State may be incomplete, include errors, or be submitted late. Perspective: After this condition was reported as a finding for the fiscal year ending September 30, 2023, the City’s department that is responsible for managing the grant implemented a review process, but it was not in place for the full fiscal year 2024. Questioned costs: None. Recommendation: The City’s department responsible for the grant should continue to perform the review process that was put in place late in fiscal year 2024. Management’s Response:. The City updated its control process to ensure that reports prepared by third-party consultant are reviewed by City staff prior to being submitted to the grantor.
2024-001 GRANT REPORTING U.S. Department of Treasury ALN 21.027 – Coronavirus State and Local Fiscal Recovery Funds Contract No. 23.saa.900.46 (2023) Passed through the Florida Department of State 2024 Funding Repeat Finding Criteria: 2 CFR 200.303 requires non-federal entities to establish and maintain effective internal controls. Reports and reimbursement requests should be subject to independent review for the full fiscal year to verify completeness, validity and timeliness of submission. The grant agreement requires quarterly progress reports to be filed with the pass through entity, Florida Department of State. Condition: Review of quarterly reports was not always documented by City officials before submittal by their third party consultant. Cause of condition: The department at the City that is responsible for managing the grant did not originally have a process in place to document their review of progress reports submitted to the Florida Department of State by their third party consultant. Potential effect of condition: Reports submitted to the Florida Department of State may be incomplete, include errors, or be submitted late. Perspective: After this condition was reported as a finding for the fiscal year ending September 30, 2023, the City’s department that is responsible for managing the grant implemented a review process, but it was not in place for the full fiscal year 2024. Questioned costs: None. Recommendation: The City’s department responsible for the grant should continue to perform the review process that was put in place late in fiscal year 2024. Management’s Response: The City updated its control process to ensure that reports prepared by thirdparty consultant are reviewed by City staff prior to being submitted to the grantor. Responsible Parties: Natalia Eckroth, CFO and Christine Aiken, Assistant Finance Director. Anticipated Completion: December 31, 2024.
2023-001
FAC accepted this audit on June 30, 2024 — management decision was due December 30, 2024.
Review of quarterly reports was not documented by City officials before submittal by their third party consultant. Cause of condition: The City does not have a process in place to document their review of progress reports submitted to the Florida Department of State by their third party consultant. Potential effect of condition: Reports submitted to the Florida Department of State may be incomplete, include errors, or be submitted late. Perspective: The City utilized a third party consultant to assist in the management of this specific grant contract under this federal program. CRI noted the City did have documentation of review of grant reports prepared by the City for the other grant contract awarded to the City under this federal program. Questioned costs: None. Recommendation: The City should review and revise, as needed, its current control structure over grant reporting to ensure that all required reports are independently reviewed prior to being submitted to the grantor. This should include review of reports prepared by any third party consultants. Management’s Response: The City will update its control process to incorporate procedures to ensure that reviews of reports prepared by third party consultants are subject to independent review by City personnel prior to the reports being remitted to the grantor and that such reviews will be documented.
Show full finding ▾Hide full finding ▴GRANT REPORTING U.S. Department of Treasury ALN 21.027 – Coronavirus State and Local Fiscal Recovery Funds Contract No. 23.saa.900.46 (2023) Passed through the Florida Department of State Criteria: 2 CFR 200.303 requires non-federal entities to establish and maintain effective internal controls. Reports and reimbursement requests should be subject to independent review to verify completeness, validity and timeliness of submission. Condition: Review of quarterly reports was not documented by City officials before submittal by their third party consultant. Cause of condition: The City does not have a process in place to document their review of progress reports submitted to the Florida Department of State by their third party consultant. Potential effect of condition: Reports submitted to the Florida Department of State may be incomplete, include errors, or be submitted late. Perspective: The City utilized a third party consultant to assist in the management of this specific grant contract under this federal program. CRI noted the City did have documentation of review of grant reports prepared by the City for the other grant contract awarded to the City under this federal program. Questioned costs: None. Recommendation: The City should review and revise, as needed, its current control structure over grant reporting to ensure that all required reports are independently reviewed prior to being submitted to the grantor. This should include review of reports prepared by any third party consultants. Management’s Response: The City will update its control process to incorporate procedures to ensure that reviews of reports prepared by third party consultants are subject to independent review by City personnel prior to the reports being remitted to the grantor and that such reviews will be documented.
2023-001 GRANT REPORTING Recommendation: The City should review and revise, as needed, its current control structure over grant reporting to ensure that all required reports are independently reviewed prior to being submitted to the grantor. This should include review of reports prepared by any third party consultants. Management’s Response: The City will update its control process to incorporate procedures to ensure that reviews of reports prepared by third party consultants are subject to independent review by City personnel prior to the reports being remitted to the grantor and that such reviews will be documented. Responsible Parties: Natalia Eckroth, CFO and Christine Aiken, Assistance Finance Director Anticipated Completion Date: December 31, 2024
The City did not document their initial verification (SAM check) that a vendor was not suspended or debarred before entering into a covered transaction for all vendors and contractors participating on Federally-funded projects, and follow-up verifications were not consistently performed. Cause of condition: Procedures for documentation of verification that vendors or contractors were eligible to participate on federally-funded projects checks were not consistently applied to all vendors. Potential effect of condition: Without initial verification of a vendor’s status to participate on federally-funded projects and timely follow-up SAM checks, the City may inadvertently enter into covered transactions with federally suspended or debarred vendors. Perspective: The City properly performed SAM checks for some, but not all, of the vendors and contractors used in covered transactions. None of the vendors tested during our audit were disqualified, excluded, or debarred per verification performed by the auditors. Additionally, the Florida Department of Environmental Protection and the Florida Department of State provide for on-going oversight and review, which mitigates the risk of non-compliance. Questioned costs: None. Recommendation: The City should evaluate its current procedures for ensuring that vendors are eligible to participate in federally-funded projects prior to signing contracts or issuing purchase orders to those vendors. Changes to procedures should be implemented, as necessary, to improve controls over compliance. Additionally, a process for periodic follow-up verification should be performed no less than annually. Management’s Response: The City will set up the following controls to monitor and ensure compliance with Sam.gov requirements on an ongoing basis. • The City’s procurement process for federally funded projects will include an item on the Vendor Questionnaire where vendors can upload their Sam.gov proof at the time of their bid submission. • The City’s Purchasing staff will review all bid submissions against Sam.gov and provide screenshots of when the information was checked. These screenshots will be saved in the bid file. Any vendor that does not show an active Sam.gov status will be rejected as non-responsive. • Any new vendor that is intended for use on a federally funded project will also be checked at the time of vendor entry into the City’s financial software by Finance. A copy of this Sam.gov check will be included with the vendor file. • Current vendors will be checked for Sam.gov compliance on an annual basis. The annual checks will be screenshot and uploaded into the vendor files. Vendor files will be updated accordingly with the date of the Sam.gov check by Finance. The annual compliance check will become part of the end-of-fiscal year closeout process. • Current vendors working on federally funded projects will also be checked for Sam.gov compliance at the time of any change order, amendment, or contract adjustment that is requested.
Show full finding ▾Hide full finding ▴SUSPENSION AND DEBARMENT U.S. Department of Treasury ALN 21.027 – Coronavirus State and Local Fiscal Recovery Funds Contract No. 23.saa.900.46 (2023) Passed through the Florida Department of State U.S. Department of Environmental Protection ALN 66.458 – Clean Water State Revolving Funds Cluster Contract No. WW6409A0/4C-02D38022-0 (2022) Passed through the Florida Department of Environmental Protection U.S. Department of Environmental Protection ALN 66.468 – Drinking Water State Revolving Funds Cluster Contract No. DW640990/FS98452220-0 (2021) Passed through the Florida Department of Environmental Protection Criteria: 2 CFR 180.300 requires the City to ensure vendors and contractors are not disqualified, excluded, or debarred prior to entering into a covered transaction. Further, 2 CFR 200.303 requires non-federal entities to establish and maintain effective internal controls. The City should have a process to ensure compliance with 2 CFR 180.300. Condition: The City did not document their initial verification (SAM check) that a vendor was not suspended or debarred before entering into a covered transaction for all vendors and contractors participating on Federally-funded projects, and follow-up verifications were not consistently performed. Cause of condition: Procedures for documentation of verification that vendors or contractors were eligible to participate on federally-funded projects checks were not consistently applied to all vendors. Potential effect of condition: Without initial verification of a vendor’s status to participate on federally-funded projects and timely follow-up SAM checks, the City may inadvertently enter into covered transactions with federally suspended or debarred vendors. Perspective: The City properly performed SAM checks for some, but not all, of the vendors and contractors used in covered transactions. None of the vendors tested during our audit were disqualified, excluded, or debarred per verification performed by the auditors. Additionally, the Florida Department of Environmental Protection and the Florida Department of State provide for on-going oversight and review, which mitigates the risk of non-compliance. Questioned costs: None. Recommendation: The City should evaluate its current procedures for ensuring that vendors are eligible to participate in federally-funded projects prior to signing contracts or issuing purchase orders to those vendors. Changes to procedures should be implemented, as necessary, to improve controls over compliance. Additionally, a process for periodic follow-up verification should be performed no less than annually. Management’s Response: The City will set up the following controls to monitor and ensure compliance with Sam.gov requirements on an ongoing basis. • The City’s procurement process for federally funded projects will include an item on the Vendor Questionnaire where vendors can upload their Sam.gov proof at the time of their bid submission. • The City’s Purchasing staff will review all bid submissions against Sam.gov and provide screenshots of when the information was checked. These screenshots will be saved in the bid file. Any vendor that does not show an active Sam.gov status will be rejected as non-responsive. • Any new vendor that is intended for use on a federally funded project will also be checked at the time of vendor entry into the City’s financial software by Finance. A copy of this Sam.gov check will be included with the vendor file. • Current vendors will be checked for Sam.gov compliance on an annual basis. The annual checks will be screenshot and uploaded into the vendor files. Vendor files will be updated accordingly with the date of the Sam.gov check by Finance. The annual compliance check will become part of the end-of-fiscal year closeout process. • Current vendors working on federally funded projects will also be checked for Sam.gov compliance at the time of any change order, amendment, or contract adjustment that is requested.
2023-002 SUSPENSION AND DEBARMENT Recommendation: The City should evaluate its current procedures for ensuring that vendors are eligible to participate in federally-funded projects prior to signing contracts or issuing purchase orders to those vendors. Changes to procedures should be implemented, as necessary, to improve controls over compliance. Additionally, a process for periodic follow-up verification should be performed no less than annually. Management’s Response: The City will set up the following controls to monitor and ensure compliance with Sam.gov requirements on an ongoing basis. • The City’s procurement process for federally funded projects will include an item on the Vendor Questionnaire where vendors can upload their Sam.gov proof at the time of their bid submission. • The City’s Purchasing staff will review all bid submissions against Sam.gov and provide screenshots of when the information was checked. These screenshots will be saved in the bid file. Any vendor that does not show an active Sam.gov status will be rejected as non-responsive. • Any new vendor that is intended for use on a federally funded project will also be checked at the time of vendor entry into the City’s financial software by Finance. A copy of this Sam.gov check will be included with the vendor file. • Current vendors will be checked for Sam.gov compliance on an annual basis. The annual checks will be screenshot and uploaded into the vendor files. Vendor files will be updated accordingly with the date of the Sam.gov check by Finance. The annual compliance check will become part of the end-of-fiscal year closeout process. • Current vendors working on federally funded projects will also be checked for Sam.gov compliance at the time of any change order, amendment, or contract adjustment that is requested. Responsible Parties: Kristen Turner, Financial Business Analyst and Holly Prevatt, Purchasing Agent Anticipated Completion Date: December 31, 2024
FAC accepted this audit on July 27, 2021 — management decision was due January 27, 2022.
Review of the quarterly reports and reimbursement requests was not consistently documented. Cause of condition: The City did not consistently retain documentation of the review of the quarterly reports and reimbursement requests. Questioned Costs: None. Perspective (Context): This is a documentation issue related to the review of the quarterly reports and reimbursement requests. Approval of the report by someone other than the preparer was being provided verbally. The quarterly reports and reimbursement requests tested for fiscal year 2020 lacked consistent documentation of review and approval, i.e., review by the Chief Financial Officer was noted for some, but not all, of the reimbursement requests selected for testing. Potential Effect of Condition: While the quarterly reports and reimbursement requests that were submitted were in compliance with the grant, the City could potentially submit a quarterly report or reimbursement request with errors if it was not reviewed prior to submittal. Recommendation: We recommend the City retain documentation of the review of financial, performance and special reporting required by the grantor. Management?s Response and Planned Corrective Action: Management acknowledges the audit finding and corrective action has been taken. While quarterly project progress reports were reviewed, documentation of the review was not consistently kept. Procedures have been changed so that documentation in the form of a written or electronic approval of the report will be retained.
Show full finding ▾Hide full finding ▴Criteria: 2 CFR 200.303 requires non-federal entities to establish and maintain effective internal controls. Internal controls over compliance should include controls related to financial, performance and special reporting required by the grantor. Reports and reimbursement requests should be subject to independent review to verify completeness, validity and timeliness of submission. Condition: Review of the quarterly reports and reimbursement requests was not consistently documented. Cause of condition: The City did not consistently retain documentation of the review of the quarterly reports and reimbursement requests. Questioned Costs: None. Perspective (Context): This is a documentation issue related to the review of the quarterly reports and reimbursement requests. Approval of the report by someone other than the preparer was being provided verbally. The quarterly reports and reimbursement requests tested for fiscal year 2020 lacked consistent documentation of review and approval, i.e., review by the Chief Financial Officer was noted for some, but not all, of the reimbursement requests selected for testing. Potential Effect of Condition: While the quarterly reports and reimbursement requests that were submitted were in compliance with the grant, the City could potentially submit a quarterly report or reimbursement request with errors if it was not reviewed prior to submittal. Recommendation: We recommend the City retain documentation of the review of financial, performance and special reporting required by the grantor. Management?s Response and Planned Corrective Action: Management acknowledges the audit finding and corrective action has been taken. While quarterly project progress reports were reviewed, documentation of the review was not consistently kept. Procedures have been changed so that documentation in the form of a written or electronic approval of the report will be retained.
CORRECTIVE ACTION PLAN June 30, 2021 The City of Daytona Beach, Florida respectfully submits the following corrective action plan for the year ended September 30, 2020. Name and address of independent public accounting firm: Carr, Riggs & Ingram, LLC 215 Baytree Drive Melbourne, Florida 32940 Audit Period: Fiscal Year October 1, 2019 ? September 30, 2020 The finding from the Schedule of Findings and Questioned Costs is discussed below. The finding number corresponds to the number assigned in the schedule. 2020-002 Review of Reports and Reimbursement Requests Recommendation: We recommend the City retain documentation of the review of financial, performance and special reporting required by the grantor. Corrective Action: Management acknowledges the audit finding and corrective action has been taken. While quarterly project progress reports were reviewed, documentation of the review was not consistently kept. Procedures have been changed so that documentation in the form of a written or electronic approval of the report will be retained. Responsible Parties: Andrew Holmes, Public Works Director, Patricia Bliss, CFO and Christine Aiken, Financial Services Manager Anticipated Completion Date: September 30, 2021
FAC accepted this audit on April 15, 2020 — management decision was due October 15, 2020.
The City?s contracting and vendor management procedures did not ensure that all construction contracts for CDBG-funded projects included wage rate requirement language and certified payrolls were not consistently obtained for the work performed. While prevailing wage rate information was posted at the job sites, the City did not have documentation that the information was communicated to the contractor as part of the contracting process. We noted two construction contracts for CDBG-funded projects subject to wage rate requirements: ? One contractor had a continuing contract with the City that did not include wage rate requirements and the contract was not amended when a purchase order was procured for work on the CDBG-funded project. A listing of the prevailing wages was posted at the job site and the contractor provided certified payrolls.A second contract included wage rate compliance language but did not specify the prevailing local wages in effect for the project. While the invoices from the contractor included a statement that wages were in compliance with Federal requirements, certified payrolls were not collected contemporaneously with work performed. Cause: Controls over purchase order issuance failed to ensure the underlying contracts met all applicable compliance requirements. Further, controls over invoice approval failed to ensure certified payrolls were submitted prior to payment of invoices. Questioned Costs: $25,803 ? cost of labor for which certified payrolls were not obtained. Perspective (Context): There were only two CDBG-funded construction contracts subject to wage rate requirements and there was lack of compliance with some element of these requirements for both contracts. However, in previous years we have audited other federal programs with wage rate requirements with no findings of control deficiencies or non-compliance. Potential Effect of Condition: As a result of the control deficiency, the City of Daytona Beach was not in compliance with the provisions of 24 CFR section 906.37 requiring contracts to include wage rate requirement language or those requiring timely receipt and review of certified payroll reports submitted by contractors to determine employees are paid prevailing wages. Recommendation: The City of Daytona Beach should review and modify, as necessary, contract and vendor management procedures to ensure: ? Construction contracts for projects funded with federal grant monies include wage rate requirement language and a schedule of the prevailing local wage to be used on the project(s). ? Certified payrolls are obtained and reviewed prior to payment of invoices for construction services on federal award funded projects. Management?s Response and Planned Corrective Action: Management agrees and will coordinate with the Community Development Department to ensure that any future construction contracts that are funded by CDBG funds will follow the proper procedures as is already in place with other City departments in regards to federal funding of construction contracts and the required documentation needed in order to be in compliance. Management would also like to note that the certified payrolls were received after the payments were made and were found to be in compliance.
Show full finding ▾Hide full finding ▴A. Compliance See 2019-001 ? Wage Rate Compliance. B. Internal Control Over Compliance 2019-001 ? Wage Rate Compliance US Department of Housing and Urban Developments CFDA 14.218 ? Community Development Block Grant Contract No. B-17-MC-12-0004 for fiscal year 2018 Criteria: 2 CFR part 200.303 requires non-Federal entities to establish and maintain effective internal controls over compliance. Additionally, 24 CFR section 906.37 requires the City of Daytona Beach, Florida (the ?City?) ensure that contractors working on CDBG-funded projects comply with Wage Rate Requirements. The City shall include in their construction contracts a provision that the contractor will comply with Wage Rate Requirements and the City must provide the contractor with a listing of the prevailing wages to be used on the project(s). This also includes a requirement for the contractor to submit weekly certified payrolls to the City evidencing that contractor employees were paid wages not less than the local prevailing wage rate. Condition: The City?s contracting and vendor management procedures did not ensure that all construction contracts for CDBG-funded projects included wage rate requirement language and certified payrolls were not consistently obtained for the work performed. While prevailing wage rate information was posted at the job sites, the City did not have documentation that the information was communicated to the contractor as part of the contracting process. We noted two construction contracts for CDBG-funded projects subject to wage rate requirements: ? One contractor had a continuing contract with the City that did not include wage rate requirements and the contract was not amended when a purchase order was procured for work on the CDBG-funded project. A listing of the prevailing wages was posted at the job site and the contractor provided certified payrolls.A second contract included wage rate compliance language but did not specify the prevailing local wages in effect for the project. While the invoices from the contractor included a statement that wages were in compliance with Federal requirements, certified payrolls were not collected contemporaneously with work performed. Cause: Controls over purchase order issuance failed to ensure the underlying contracts met all applicable compliance requirements. Further, controls over invoice approval failed to ensure certified payrolls were submitted prior to payment of invoices. Questioned Costs: $25,803 ? cost of labor for which certified payrolls were not obtained. Perspective (Context): There were only two CDBG-funded construction contracts subject to wage rate requirements and there was lack of compliance with some element of these requirements for both contracts. However, in previous years we have audited other federal programs with wage rate requirements with no findings of control deficiencies or non-compliance. Potential Effect of Condition: As a result of the control deficiency, the City of Daytona Beach was not in compliance with the provisions of 24 CFR section 906.37 requiring contracts to include wage rate requirement language or those requiring timely receipt and review of certified payroll reports submitted by contractors to determine employees are paid prevailing wages. Recommendation: The City of Daytona Beach should review and modify, as necessary, contract and vendor management procedures to ensure: ? Construction contracts for projects funded with federal grant monies include wage rate requirement language and a schedule of the prevailing local wage to be used on the project(s). ? Certified payrolls are obtained and reviewed prior to payment of invoices for construction services on federal award funded projects. Management?s Response and Planned Corrective Action: Management agrees and will coordinate with the Community Development Department to ensure that any future construction contracts that are funded by CDBG funds will follow the proper procedures as is already in place with other City departments in regards to federal funding of construction contracts and the required documentation needed in order to be in compliance. Management would also like to note that the certified payrolls were received after the payments were made and were found to be in compliance.
Audit Period: Fiscal Year October 1, 2018 ? September 30, 2019 The finding from the Schedule of Findings and Questioned Costs is discussed below. The finding number corresponds to the number assigned in the schedule. SA 2019-001 ? Wage Rate Compliance Recommendation: The City of Daytona Beach should review and modify, as necessary, contract and vendor management procedures to ensure: ? Construction contracts for projects funded with federal grant monies include wage rate requirement language and a schedule of the prevailing local wage to be used on the project(s) ? Certified payrolls are obtained and reviewed prior to payment of invoices for construction services on federal award funded projects. Corrective Action: Management agrees and will coordinate with the Community Development Department to ensure that any future construction contracts that are funded by CDBG funds will follow the proper procedures as is already in place with other City departments in regards to federal funding of construction contracts and the required documentation needed in order to be in compliance. Management would also like to note that the certified payrolls were received after the payments were made and were found to be in compliance.
FAC accepted this audit on June 26, 2017 — management decision was due December 26, 2017.
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