East Casey County Water District

Criteria: In accordance with Uniform Guidance, Section 200.318(a), and 200.319(c) a non-Federal entity must have written procurement procedures that conform to procurement methods identified in the Uniform Guidance at Section 200.320. Condition: The District has not adopted written policies as required by 200.318(a) and 200.319(c) that are consistent with the methods of procurement outlined in Section 200.320 of the Uniform Guidance. Cause: The District received federal funds for a construction project. The District typically does not receive federal funding and is unfamiliar with the written procurement requirements of the Uniform Guidance. Effect: The District did not have written procurement policies that complied with the procurement standards of Uniform Guidance. However, due to the State’s threshold for bidding and oversight requirements of the program, the District complied, in all material respects, with the procurement methods allowed under the Uniform Guidance. Recommendation: We recommend that the District document written procurement policies that comply with the Uniform Guidance and include in those policies the allowed methods of procurement under Section 200.320. Response: Management agrees with the finding and will prepare or have prepared a written procurement policy which complies with the requirements of Uniform Guidance.

Criteria: The District is required to have internal controls in place that enable it to prepare complete financial statements, including the schedule of expenditure of federal awards in accordance with generally accepted accounting standards and in accordance with the Uniform Guidance at 2 CFR 200.510(b). Condition: The District did not record federal grant income or expenses for the Water and Waste Disposal Systems for Rural Communities program. Cause: The District failed to have internal controls to properly record all federal grant activity and identify federal funds. Effect: The District did not record federal grant income or expenditures for the Water and Waste Disposal Systems for Rural Communities. The exclusion resulted in a material misstatement of contributed capital and construction in process. In addition, management engaged the auditor to prepare the schedule of expenditure of federal awards. Management reviewed, approved and accepted responsibility for the schedule of expenditure of federal awards prior to its issuance. Recommendation: We recommend that management review their procedures for identifying federal funds and review the costs and benefits involved to retain a consultant with the required expertise to prepare the schedule of expenditure of federal awards. Response: Management agrees with the finding and will review internal control procedures related to the recording of federal grant activity and cost to retain a consultant with the required expertise to prepare the schedule of expenditure of federal awards.

Criteria: In accordance with Uniform Guidance, Section 200.318(a), and 200.319(c) a non-Federal entity must have written procurement procedures that conform to procurement methods identified in the Uniform Guidance at Section 200.320. Condition: The District has not adopted written policies as required by 200.318(a) and 200.319(c) that are consistent with the methods of procurement outlined in Section 200.320 of the Uniform Guidance. Cause: The District received federal funds as part of loan drawdowns for a construction project. The District typically does not receive federal funding and is unfamiliar with the written procurement requirements of the Uniform Guidance. Effect: The District did not have written procurement policies that complied with the procurement standards of Uniform Guidance. However, due to State threshold’s for bidding and oversight requirements of the loan program, the District complied, in all material respects, with the procurement methods allowed under the Uniform Guidance. Recommendation: We recommend that the District document written procurement policies that comply with the Uniform Guidance and include in those policies the allowed methods of procurement under Section 200.320. Response: Management agrees with the finding and will prepare or have prepared a written procurement policy which complies with the requirements of Uniform Guidance.