The City of Homewood, AlabamaLocal Government

Criteria: The policies and procedures of the City state that invoices must be approved by the department head or an individual who has been given authority by the department head before payment is made (with the exclusion of utilities and other data sensitive billings). Condition: During our testing of internal control over compliance, we identified two invoices to which approval was not properly documented prior to payment. Cause and effect: The lack of approval documented on the identified invoices indicates that payments can be made to vendors without being approved by department heads or individuals who have been given such authority by the department head. Identification of repeat finding: This is not a repeat finding. Recommendation: The City should follow established policies and procedures concerning obtaining approval prior to payment. View of responsible officials: The City does not concur – see corrective action plan.. View of responsible officials: The City of Homewood, Alabama will strive to submit its Single Audit Reporting Package to the federal audit clearinghouse no later than nine months after the fiscal year end for all future funds received from the federal government.

Criteria: According to the Compliance and Reporting Guidance for the Coronavirus State and Local Fiscal Recovery Funds, all recipients are required to submit Project and Expenditure Reports. The City is considered a non-entitlement unit and is therefore required to submit reports on an annual basis and must be submitted to the Department of Treasury by April 30th of each year. Condition: The City did not submit their Project and Expenditure Report that was due on April 30, 2023 and April 30, 2024. Cause and effect: The late submission of the Project and Expenditure Report is due to turnover at the City; as well as the fact that adequate internal controls were not established to make sure this report was filed on time. The late submission of the Project and Expenditures Report shows a significant deficiency in the City’s internal control structure. Identification of repeat finding: This is a repeat finding. Recommendation: The City should strive to submit their Project and Expenditure Report annually by the due date of April 30th each year. View of responsible officials: The City does not concur – see corrective action plan.

Criteria: Per the Uniform Guidance at 2 CFR 200.320, purchases classified as a “simplified acquisition” are those with an aggregate dollar amount above the micro-purchase threshold but below the simplified acquisition threshold determined by either the State Bid Law or Uniform Guidance; whichever is more restrictive. If “simplified acquisition” procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources. Condition: Adequate controls were not in place to ensure that procedures for purchases classified as a “simplified acquisition” are being followed. Cause and effect: Lack of policies and procedures for purchases that fall under the classification of “simplified acquisition” led to the noncompliance with Uniform Guidance 2 CFR 200.320. Identification of repeat finding: This is not a repeat finding. Recommendation: The City should adopt policies and procedures and improve controls to ensure that procurement requirements for federal awards are being met. View of responsible officials: The City concurs – see corrective action plan.

Criteria: The requirements of Title 2 U.S. Code of Federal Regulations Part 180, OMB Guidelines to Agencies on Government-Wide Debarment and Suspension state that when you enter into a covered transaction with another person or entity, you must verify that the person or entity with whom you intend to do business is not excluded or disqualified. Condition: The City did not have adequate controls in place to ensure that person or entities were not suspended or debarred. Cause and effect: The City lacks the policies and procedures concerning the process of determining if a person or entity is suspended or debarred. The lack of such policies and procedures for suspension and debarment could result in contracts with suspended or debarred vendors. Identification of repeat finding: This is a repeat finding. Recommendation: The City should adopt policies and procedures and improve controls necessary to ensure there is evidence of review of suspended or debarred vendors is included with bid-contract documents. View of responsible officials: The City concurs – see corrective action plan.

Criteria: The requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), requires the City of Homewood, Alabama to submit its Single Audit Reporting Package to the federal audit clearinghouse no later than nine months after fiscal year end. Condition: The federal reporting deadline for the City of Homewood, Alabama’s Single Audit Reporting Package for the year ended September 30, 2023 was June 30, 2024; however, the City did not issue its Single Audit until after that date. Cause and effect: The late completion of the City of Homewood, Alabama’s single audit is due to the delays in obtaining information necessary to perform testing, which extended the completion date of the single audit and resulted in the late submission of the City’s Single Audit Reporting Package. The late submission of the Single Audit Reporting Package shows a significant deficiency in the City of Homewood, Alabama’s internal control. Recommendation: The City of Homewood, Alabama should strive to submit its Single Audit Reporting Package to the federal audit clearinghouse no later than nine months after its fiscal year end. View of responsible officials: The City of Homewood, Alabama will strive to submit its Single Audit Reporting Package to the federal audit clearinghouse no later than nine months after the fiscal year end for all future funds received from the federal government.

Criteria: The requirements of Title 2 U.S. Code of Federal Regulations Part 180, OMB Guidelines to Agencies on Government-Wide Debarment and Suspension state that when you enter into a covered transaction with another person or entity, you must verify that the person or entity with whom you intend to do business is not excluded or disqualified. Condition: The City of Homewood, Alabama did not have adequate controls in place to ensure that person or entities were not suspended or debarred. Cause and effect: The City of Homewood, Alabama lacks the policies and procedures concerning the process of determining if a person or entity is suspended or debarred. The lack of such policies and procedures for suspension and debarment could result in contracts with suspended or debarred vendors. Recommendation: The City of Homewood, Alabama should adopt policies and procedures and improve controls necessary to ensure there is evidence of review of suspended or debarred vendors is included with bid-contract documents. View of responsible officials: The City of Homewood, Alabama has plans to revise its policies and procedures for federal award programs to include procedures related to suspension and debarment.

Criteria: The Compliance and Reporting Guidance for the Coronavirus State and Local Fiscal Recovery Funds, all recipients are required to submit Project and Expenditure Reports. The City of Homewood is considered a nonentitlement unit and is therefore required to submit reports on an annual basis and must be submitted to the Department of Treasury by April 30th of each year. Condition: The City of Homewood, Alabama did not submit their Project and Expenditure Report that was due on April 30, 2023. Cause and effect: The late submission of the Project and Expenditure Report is due to turnover at the City of Homewood, Alabama; as well as the fact that adequate internal controls were not established to make sure this report was filed on time. The late submission of the Project and Expenditures Report shows a significant deficiency in the City of Homewood, Alabama’s internal control structure. Recommendation: The City of Homewood, Alabama should strive to submit their Project and Expenditure Report annually by the due date of April 30th each year. View of Responsible Officials: The City of Homewood, Alabama is in the process of submitting their Project and Expenditure Report to the Department of Treasury that was due on April 30, 2023.

Criteria: The requirements of Title 2 U.S. Code of Federal Regulation Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), requires the City of Homewood, Alabama to submit its Single Audit Reporting Package to the federal audit clearinghouse no later than nine months after fiscal year end.Statement of Condition: The federal reporting deadline for the City of Homewood, Alabama?s Single Audit Reporting Package for the year ended September 30, 2021 was June 30, 2022; however, the City did not issue its Program Specific Audit until after that date.Statement of Cause: The late completion of the City of Homewood, Alabama?s single audit is due to the delays in obtaining information necessary to perform testing, which extended the completion date of the single audit and resulted in the late submission of the City?s Single Audit Reporting Package.Statement of Effect: The late submission of the Single Audit Reporting Package shows a significant deficiency in the City of Homewood, Alabama?s internal control.Recommendations: The City of Homewood, Alabama should strive to submit its Single Audit Reporting Package to the federal audit clearinghouse no later than nine months after its fiscal year end.Response: The City of Homewood, Alabama will strive to submit its Single Audit Reporting Package to the federal audit clearinghouse no later than nine months after the fiscal year end for all future funds received from the federal government.