TOWN OF TAOS

Federal Program Information: Funding Agencies: U.S. Department of Housing and Urban Development Titles: Community Development Block Grant Assistance Listing Number: 14.228 Award Year: July 1, 2022 to June 30, 2023 Condition: During our audit we noted that two of the four quarterly progress reports were not submitted by the due date. Criteria: According to 42 USC 12708(a), 24 CFR 91.520, and 24 CFR 570.491, the Progress Reports are required to be submitted before 90 days after the close of the Town’s reporting period. Effect: Two of the Town’s progress reports were submitted late. Questioned Costs: None Cause: The Town had turnover in the position who enters the information into HUD’s reporting system and this resulted in the first two quarterly progress reports being submitted late. The last two quarterly progress reports were submitted on time for the fiscal year. Auditors’ Recommendation: We recommend that the Town cross-train another employee to know how to submit these federal progress reports so if there is another vacancy in this or any other position that submits reports at the Town, will not result in other reports being submitted late. Management’s Response: The Town of Taos will continue to focus on the professional development of all employees and will cross-train employees on the completion and submission of federal progress reports. The Finance Department has filled the key position with a Grant Administrator who will be the responsible person for this task and will immediately ensure all future progress reports are submitted in a timely manner. While the Town did complete the progress reports and submitted the reports to the granting agency upon discovery, we understand it is our fiduciary responsibility to ensure all financial reports are timely.

2020-001 ? Reporting? (Material Weakness and Noncompliance) Federal Program Information: Funding Agencies: U.S. Department of Interior ? Bureau of Reclamation Titles: Implementation of the Taos Pueblo Indian Water Rights Settlement CFDA Number: 15.565 Award Year: July 1, 2019 to June 30, 2020 Condition: During our audit we noted that one of the semi-annual SF-425 federal financial reports did not have the correct reported amounts that matched what was recorded in the general ledger for the reported period of the fiscal year. The report dated 3/31/2020 had $44,343 less expenditures reported on the SF-425 compared to the general ledger. Criteria: The SF-425, Federal Financial Report is required for the administration of the grant. These reports are to be accurately completed and supported by the underlying accounting records. Effect: The Town understated their grant expenditures resulting in the 2nd semi-annual SF-425 report not being accurate by the amount above. Questioned Costs: None Cause: The client did not include one of the progress report amounts in the SF-425 which resulted in the incorrect amount being reported. Auditors? Recommendation: We recommend that the Town should adjust the review process to include the Finance department as a second review before submitting the report to the Bureau of Reclamation. Management?s Response: Management agrees with the auditor?s recommendation. The Grants and Revenue Development Director will now submit all semi-annual reports to the Finance Director for approval prior to submission to the Bureau of Reclamation, just as the draw down for funds procedure that are currently in place, which have prior approval before the draw down is completed. The second review will ensure all future semi-annual reports to be accurate. The personnel responsible for this are the Grants and Revenue Development Director and the Finance Director.