CITY OF PILOT ROCKLocal Government

Criteria: The City is required to submit its annual audited financial statements to the USDA within 150 days of year end for fiscal years where no Single Audit is required. Condition: The audited financial statements for the year ended June 30, 2020 were not submitted until September 8, 2021. Cause: The City was unaware of the requirement to provide the financial statements to the USDA. Effect: The late reporting of financial information provides inaccurate information to the grantor during the year. Context: This appears to be an isolated occurrence; while the City did not submit its annual audited financial statements timely, other reports required by the grantor were submitted timely. During the year, 14 reimbursement requests that included budget information were filed with the grantor without exception. Recommendation: The City should enhance its procedures to ensure that annual audits are filed within the timeframe required. Views of Responsible Officials and Planned Corrective Actions: The City officials are in agreement with the condition and will implement procedures to ensure timely reporting.

Criteria: In years when more that $750,000 of federal funding is expended, the City is required to prepare a Schedule of Expenditures of Federal Awards (?SEFA?). The SEFA should include all federal programs with accurate Federal Assistance numbers and total federal expenditures during the year. Condition: The SEFA prepared by the City contained errors including incorrect federal program names and Federal Assistance numbers, and incorrect federal expenditure amounts. Cause: Internal controls over the preparation and review process of the SEFA are not adequate to detect SEFA misstatements. Effect: The SEFA underreported some federal expenditures and contained incorrect federal program names and Federal Assistance references. Context: The City has had very few Single Audits performed as its federal expenditures rarely meet the $750,000 threshold, and the staff are unfamiliar with the reporting requirements that a Single Audit requires. The City relies on the auditors? assistance with the preparation of the SEFA and the accompanying notes. Recommendation: When preparing a SEFA to provide to the auditors, the City should review grant agreements for correct program titles and Federal Assistance numbers. Expenditures during the year should match amounts reported on the SEFA. Views of Responsible Officials and Planned Corrective Actions: The City officials are in agreement with the condition and recommendation above and will implement procedures to ensure accurate reporting.