EIN: 952235918
UEI: SB1RGMJ5U1M7
Audited by: Badawi & Associates, CPAs
Oversight agency: 21 [Department of the Treasury]
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Data as of September 2, 2026
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on March 31, 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 October 1, 2026 (25 days from today).
What is a management decision? →SA 2025-001: Unable to Retrieve FAA-Related Reports (Reporting) Federal Award Name: Airport Improvement Program AL Number: 20.106 Name of Federal Agency: Department of Transportation Federal Award Identification Number and Year: 3-06-0359-029-2021; 3-06-0359-031-2022; 3-06-0359-032- 2023; 3-06-0359-033-2024; Award Years: 2021, 2022, 2023, 2024. Criteria In accordance with 2 CFR § 200.328, the sponsor is required to submit FAA Form 5100-140 (Performance Report), FAA Form 5370-1 (Construction Progress and Inspection Report), and FAA Form 5100-127 (Operating and Financial Summary Report) to satisfy the performance reporting requirements. Condition During our audit, we noted that the City was required to submit the FAA-related reports (Forms 5100-140, 5370-01, and 5100-127). However, the City was unable to provide evidence that those reports were submitted. Cause The City has experienced staff turnover in the airport management during the grant period, which contributed to the City’s inability to locate previously submitted FAA documentation for our review. Effect We were unable to verify the City’s compliance based on the City’s retained FAA reporting records. Recommendation We recommend that the City enhance its document-retention procedures to ensure that copies of all required FAA reports are properly maintained and readily accessible for future audit purposes. Management Response The City acknowledges the auditors’ observation regarding the inability to locate copies of FAA Forms 5100-140, 5370-1, and 5100-127 within the City’s retained documentation at the time of the audit. During the audit, the City provided the auditors with the FAA Grant Closeout Letter dated October 29, 2025, issued by the Federal Aviation Administration (FAA) for the applicable Airport Improvement Program grant. This letter represents the FAA’s formal confirmation that the grant was administratively closed and that all required documentation was received, reviewed, and accepted by the FAA. Under 49 U.S.C. § 471, 2 CFR Part 200, and FAA Order 5100.38, grant closeout cannot occur until required documentation has been submitted and accepted by the FAA. Accordingly, the City believes the FAA’s issuance of the grant closeout letter provides reasonable assurance that all required reporting documentation was submitted and accepted as part of the closeout process. To address this document retention observation, the City has updated its procedures to ensure that all FAA grant documentation is properly maintained and readily accessible for future audits. Responsibilities for monitoring and maintaining these documents have been assigned to designated personnel.
Show full finding ▾Hide full finding ▴SA 2025-001: Unable to Retrieve FAA-Related Reports (Reporting) Federal Award Name: Airport Improvement Program AL Number: 20.106 Name of Federal Agency: Department of Transportation Federal Award Identification Number and Year: 3-06-0359-029-2021; 3-06-0359-031-2022; 3-06-0359-032- 2023; 3-06-0359-033-2024; Award Years: 2021, 2022, 2023, 2024. Criteria In accordance with 2 CFR § 200.328, the sponsor is required to submit FAA Form 5100-140 (Performance Report), FAA Form 5370-1 (Construction Progress and Inspection Report), and FAA Form 5100-127 (Operating and Financial Summary Report) to satisfy the performance reporting requirements. Condition During our audit, we noted that the City was required to submit the FAA-related reports (Forms 5100-140, 5370-01, and 5100-127). However, the City was unable to provide evidence that those reports were submitted. Cause The City has experienced staff turnover in the airport management during the grant period, which contributed to the City’s inability to locate previously submitted FAA documentation for our review. Effect We were unable to verify the City’s compliance based on the City’s retained FAA reporting records. Recommendation We recommend that the City enhance its document-retention procedures to ensure that copies of all required FAA reports are properly maintained and readily accessible for future audit purposes. Management Response The City acknowledges the auditors’ observation regarding the inability to locate copies of FAA Forms 5100-140, 5370-1, and 5100-127 within the City’s retained documentation at the time of the audit. During the audit, the City provided the auditors with the FAA Grant Closeout Letter dated October 29, 2025, issued by the Federal Aviation Administration (FAA) for the applicable Airport Improvement Program grant. This letter represents the FAA’s formal confirmation that the grant was administratively closed and that all required documentation was received, reviewed, and accepted by the FAA. Under 49 U.S.C. § 471, 2 CFR Part 200, and FAA Order 5100.38, grant closeout cannot occur until required documentation has been submitted and accepted by the FAA. Accordingly, the City believes the FAA’s issuance of the grant closeout letter provides reasonable assurance that all required reporting documentation was submitted and accepted as part of the closeout process. To address this document retention observation, the City has updated its procedures to ensure that all FAA grant documentation is properly maintained and readily accessible for future audits. Responsibilities for monitoring and maintaining these documents have been assigned to designated personnel.
SA 2025-001: Unable to Retrieve FAA-Related Reports (Reporting) – Significant Deficiency Responsible Official: Carmen Cun, Director of Finance & Asdghik Keyvanian, Assistant Director of Finance Corrective Action Plan: The City acknowledges the auditors’ observation regarding the inability to locate copies of FAA Forms 5100-140, 5370-1, and 5100-127 within the City’s retained documentation at the time of the audit. During the audit, the City provided the auditors with the FAA Grant Closeout Letter dated October 29, 2025, issued by the Federal Aviation Administration (FAA) for the applicable Airport Improvement Program grant. This letter represents the FAA’s formal confirmation that the grant was administratively closed and that all required documentation was received, reviewed, and accepted by the FAA. Under 49 U.S.C. § 471, 2 CFR Part 200, and FAA Order 5100.38, grant closeout cannot occur until required documentation has been submitted and accepted by the FAA. Accordingly, the City believes the FAA’s issuance of the grant closeout letter provides reasonable assurance that all required reporting documentation was submitted and accepted as part of the closeout process. To address this document retention observation, the City has updated its procedures to ensure that all FAA grant documentation is properly maintained and readily accessible for future audits. Responsibilities for monitoring and maintaining these documents have been assigned to designated personnel. Anticipation Completion Date: March 31, 2026
FAC accepted this audit on April 4, 2025 — management decision was due October 4, 2025.
FAC accepted this audit on June 27, 2024 — management decision was due December 27, 2024.
FAC accepted this audit on May 30, 2023 — management decision was due November 30, 2023.
The City has specific CDBG grant personnel that are responsible for reviewing all grant expenditures to ensure they are allowable. However, the designated grant personnel are reviewing the expenditures after the disbursement has been made instead of prior to authorizing the disbursement and charging to the grant. In addition, there is no formal documentation retained to illustrate that all disbursements were reviewed. Internal controls over federal awards should include authorization by appropriate grant personnel prior to such disbursements occurring. Questioned Costs: None noted. Context: All disbursements are reviewed in the same manner. Cause: The City will correct any unallowed expenditures identified by grant personnel by moving such expenditures to an appropriate fund and revenue source. These procedures were deemed by the City to be adequate. Effect: Without formal documentation of the review process, the review might not occur without management's knowledge. In addition, internal controls should have a preventative as well as detective aspect to ensure timely identification of any unallowable costs or activities. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the City either utilize the electronic authorization capabilities of the accounting system or manually initial or sign invoices to have approvals of all grants expenditures by the designated grant personnel prior to disbursing the funds.
Show full finding ▾Hide full finding ▴Federal Agency: United States Department of Housing and Urban Development Federal Program Name: CDBG Entitlement Grants Cluster: Community Development Block Grant (CDBG) Assistance Listing Number: 14.218 Federal Award Identification Number and Year: B-21-MC-06-0593; B-20-MC-06-0593; B-19-MC-06-0593; B-18-MC-06-0593; B-17-MC-06-0593; B-16-MC-06-0593; Award Years 2021, 2020, 2019, 2018, 2017, and 2016 Award Period: Fiscal Year 2021-2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance (Allowable Costs) ? Other Matter (Allowable Costs) Criteria or Specific Requirement: 2 CFR Part 200, section 200.303 of the Uniform states that a non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: The City has specific CDBG grant personnel that are responsible for reviewing all grant expenditures to ensure they are allowable. However, the designated grant personnel are reviewing the expenditures after the disbursement has been made instead of prior to authorizing the disbursement and charging to the grant. In addition, there is no formal documentation retained to illustrate that all disbursements were reviewed. Internal controls over federal awards should include authorization by appropriate grant personnel prior to such disbursements occurring. Questioned Costs: None noted. Context: All disbursements are reviewed in the same manner. Cause: The City will correct any unallowed expenditures identified by grant personnel by moving such expenditures to an appropriate fund and revenue source. These procedures were deemed by the City to be adequate. Effect: Without formal documentation of the review process, the review might not occur without management's knowledge. In addition, internal controls should have a preventative as well as detective aspect to ensure timely identification of any unallowable costs or activities. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the City either utilize the electronic authorization capabilities of the accounting system or manually initial or sign invoices to have approvals of all grants expenditures by the designated grant personnel prior to disbursing the funds.
Views of Responsible Officials: The City maintains internal controls to review all CDBG expenditures. These controls vary based upon expenditure type (e.g. administration, City Department subrecipients, and non-City subrecipients); however, all of these expenditure types are reviewed prior to disbursement. These controls are summarized as follows: ? Administration ? Expenditures such as hours worked by City Staff, procurement of office supplies used to supplement the CDBG program, and other administrative costs are tracked through the City?s accounting system. These measures currently include the review/approval by managers/supervisors of City staff hours worked and the projects/activities completed, and review/approval of Purchase Requisitions and Purchase Orders by City staff through the City?s accounting system, all of which occur prior to disbursement. Purchase Requisitions and Purchase Orders also include a contract and an invoice or project description that lets appropriate City staff determine the eligibility of the proposed disbursement and the associated account being charged. ? City Department Subrecipients ? Expenditures for City Department Subrecipients are not made until review has been completed and the associated Purchase Requisitions and Purchase Orders is approved by appropriate City staff. Purchase Requisitions and Purchase Orders also include an invoice or project description that lets appropriate City staff determine the eligibility of the proposed disbursement and the associated account being charged. Applicable projects are also tracked through the City?s process to solicit bids/proposals, with the scope of work reviewed during all phases of the project to ensure grant eligibility. ? Non-City Subrecipients ? Subrecipients from outside the organization are subject to a thorough reimbursement protocol that includes the following: o Checklist - Provided to all grantees outlining requirements for submitting reimbursement requests, with example/fillable exhibits to outline eligible expenditures. These exhibits require the submittal of supplemental evidence (e.g. receipts, cancelled check/bank statements, time sheets, description of services provided, client eligibility, etc.). Paper records of these items are maintained. o Reviews - All reimbursement requests are reviewed/verified by two separate City departmental grant staff, with signatures confirming the eligibility of the request. Paper records of these items are maintained. o Purchase Orders - Invoices are included in all submittals to the City?s accounting system. All purchase orders are reviewed/approved by City staff via accounting system. In addition to maintaining paper records, moving forward all Purchase Orders and submitted invoices for non-City subrecipients will include copies of the approved/signed exhibits further confirming staff review of such items. All other Purchase Orders will include invoices that include a signed or initialed acknowledgement by appropriate City staff to supplement reviews/approval performed via the City?s accounting system.
From July 2021 through September 2021, personal services charged were recorded for two employees based on budget to the program and an after-the-fact determination of personal services charged to the program was not conducted and adjustments, if necessary, were not recorded. In addition, The City corrected this matter beginning October 2021 and this finding did not apply from October 2021 through June 2022. In addition, in some cases, overtime charges occurred that were not supported by timesheets. Questioned Costs: The amount of known salaries and fringe benefits charged to the federal program that were based on budgeted percentages during the fiscal year 2021-2022 is $24,358. The amount of overtime charged to the federal program that was not supported by timesheets was $853. The likely amount of questioned costs for overtime charges cannot be determined since there are no records that accurately reflect the actual work performed. Context: Payroll and fringe benefits were charged based on budgeted percentages in 2 of 12 samples tested. There was a total of 4 pay periods where two employees' wages and fringe benefits were charged to the program based on budgeted percentages. Overtime was charged without a supporting timesheet in 2 out of 12 samples tested. Cause: The City received the comment in prior years and did not make changes for all employees for the fiscal year 2021-2022. Overtime charges that occurred without a timesheet was an error not identified or corrected through the internal control process. Effect: The amount of personal services charged to the federal award may be over or understated. Repeat Finding: Repeat of prior year finding number 2021-006. Recommendation: We recommend that personnel track their actual time spent working on the program (including all other hours worked) so that an after-the-fact adjustments can be made such that the final amount charged to the federal award is accurate, allowable, and properly allocated. This recommendation was implemented by the City beginning October 2021. We recommend that the City implement policies and procedures to review all charges to federal awards, including overtime, to verify amounts are supported by timesheets that are approved by appropriate supervisors.
Show full finding ▾Hide full finding ▴Federal Agency: United States Department of Housing and Urban Development Federal Program Name: CDBG Entitlement Grants Cluster: Community Development Block Grant (CDBG) Assistance Listing Number: 14.218 Federal Award Identification Number and Year: B-21-MC-06-0593; B-20-MC-06-0593; B-19-MC-06-0593; B-18-MC-06-0593; B-17-MC-06-0593; B-16-MC-06-0593; Award Years 2021, 2020, 2019, 2018, 2017, and 2016 Award Period: Fiscal Year 2021-2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance (Allowable Costs) ? Other Matter (Allowable Costs) Criteria or Specific Requirement: Allowable Costs: Uniform Guidance Title 2, Subtitle A, Chapter II, Part 200, Subpart E, ?200.430 allows for budget estimates for personal services to be used for interim accounting purposes provided, among other criteria, that ?The nonfederal entity?s system of internal controls includes processes to review after-the-fact interim charges made to a federal awards based on budget estimates. All necessary adjustments must be made such that the final amount charged to the federal award is accurate, allowable, and properly allocated.? Allowable Costs: Uniform Guidance Title 2, Subtitle A, Chapter II, Part 200, Subpart E, ?200.430 requires payroll records to support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and nonfederal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: From July 2021 through September 2021, personal services charged were recorded for two employees based on budget to the program and an after-the-fact determination of personal services charged to the program was not conducted and adjustments, if necessary, were not recorded. In addition, The City corrected this matter beginning October 2021 and this finding did not apply from October 2021 through June 2022. In addition, in some cases, overtime charges occurred that were not supported by timesheets. Questioned Costs: The amount of known salaries and fringe benefits charged to the federal program that were based on budgeted percentages during the fiscal year 2021-2022 is $24,358. The amount of overtime charged to the federal program that was not supported by timesheets was $853. The likely amount of questioned costs for overtime charges cannot be determined since there are no records that accurately reflect the actual work performed. Context: Payroll and fringe benefits were charged based on budgeted percentages in 2 of 12 samples tested. There was a total of 4 pay periods where two employees' wages and fringe benefits were charged to the program based on budgeted percentages. Overtime was charged without a supporting timesheet in 2 out of 12 samples tested. Cause: The City received the comment in prior years and did not make changes for all employees for the fiscal year 2021-2022. Overtime charges that occurred without a timesheet was an error not identified or corrected through the internal control process. Effect: The amount of personal services charged to the federal award may be over or understated. Repeat Finding: Repeat of prior year finding number 2021-006. Recommendation: We recommend that personnel track their actual time spent working on the program (including all other hours worked) so that an after-the-fact adjustments can be made such that the final amount charged to the federal award is accurate, allowable, and properly allocated. This recommendation was implemented by the City beginning October 2021. We recommend that the City implement policies and procedures to review all charges to federal awards, including overtime, to verify amounts are supported by timesheets that are approved by appropriate supervisors.
Views of Responsible Officials: Since early 2021, City staff funded by CDBG/HOME entitlement grants have utilized electronic timesheets to track time spent working on the various programs by adjusting their weekly time entries to reflect actual time spent on a specific eligible activity. In some cases, these activities are also tracked by a Journal Entry (JE) with a description of the eligible activities and an hourly breakdown provided to supplement the JE. These tracking methods ensure amounts charged to the federal awards are accurate, allowable, and properly allocated. Additionally, overtime hours inadvertently entered by Code Enforcement Staff has been addressed by Code Enforcement Supervisors who are communicating with their employees to ensure they are tracking time and completing electronic time sheets correctly. All coding changes performed by finance department personnel will be sent via email for approval by supervisors until the payroll division can implement new procedures through the electronic timesheet system that will route approvals to supervisors through the established workflow. Additionally, case management / GIS system adjustments at a parcel level will be developed to further improve data correlation between claimed staff hours and program specific locations. Beginning October 2021, as noted, continuing through the reporting period with implementation ongoing since that time, the subject finding has been corrected. The personnel services charged for two employees based on budget to the program has since been corrected beginning October 2021 as noted.
2021-006
After the findings the City received in the prior year audit, the City revised the internal controls over payroll to require a supervisor's review and approval of hours charged to federal awards on the electronic timesheets, which is in line with the requirements of the Uniform Guidance. In 2 out of 12 payroll transactions tested, there was no supervisor approval of hours charged to the federal award, which was a lack of internal controls. Questioned Costs: None since hours worked were documented (except as noted in finding 2022-005), but the support for the supervisor approval was not able to be inspected and verified. Context: The payroll charges without supervisor approval totals $5,188 and occurred in 2 out of 12 transactions tested. Cause: Upon receiving the prior year finding, the City was not able to implement the payroll internal control changes for all transactions in the next fiscal year since part of the year had passed before the audit procedures could be performed. Effect: The payroll records are not in compliance with the requirements of the Uniform Guidance. Repeat Finding: Repeat of prior year finding number 2021-007. Recommendation: We recommend that the City ensure all timesheets require approval of hours charged to federal awards by a supervisor so that the City is in compliance with the Uniform Guidance payroll documentation requirements.
Show full finding ▾Hide full finding ▴Federal Program Name: CDBG Entitlement Grants Cluster: Community Development Block Grant (CDBG). Assistance Listing Number: 14.218. Federal Award Identification Number and Year: B-21-MC-06-0593; B-20-MC-06-0593; B-19-MC-06-0593; B-18-MC-06-0593; B-17-MC-06-0593; B-16-MC-06-0593; Award Years 2021, 2020, 2019, 2018, 2017, and 2016 Award Period: Fiscal Year 2021-2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance (Allowable Costs) ? Other Matter (Allowable Costs) Criteria or Specific Requirement: Allowable Costs: Uniform Guidance Title 2, Subtitle A, Chapter II, Part 200, Subpart E, ?200.430 requires payroll charges to be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Condition: After the findings the City received in the prior year audit, the City revised the internal controls over payroll to require a supervisor's review and approval of hours charged to federal awards on the electronic timesheets, which is in line with the requirements of the Uniform Guidance. In 2 out of 12 payroll transactions tested, there was no supervisor approval of hours charged to the federal award, which was a lack of internal controls. Questioned Costs: None since hours worked were documented (except as noted in finding 2022-005), but the support for the supervisor approval was not able to be inspected and verified. Context: The payroll charges without supervisor approval totals $5,188 and occurred in 2 out of 12 transactions tested. Cause: Upon receiving the prior year finding, the City was not able to implement the payroll internal control changes for all transactions in the next fiscal year since part of the year had passed before the audit procedures could be performed. Effect: The payroll records are not in compliance with the requirements of the Uniform Guidance. Repeat Finding: Repeat of prior year finding number 2021-007. Recommendation: We recommend that the City ensure all timesheets require approval of hours charged to federal awards by a supervisor so that the City is in compliance with the Uniform Guidance payroll documentation requirements.
Views of Responsible Officials: Since early 2021, City Staff funded by CDBG/HOME entitlement grants have utilized electronic timesheets to track time spent working on the various programs by adjusting their weekly time entries to reflect actual time spent on a specific eligible activity. In some cases, these activities are also tracked by a Journal Entry (JE) with a description of the eligible activities and an hourly breakdown provided to supplement the JE. These tracking methods ensure amounts charged to the federal awards are accurate, allowable, and properly allocated. Additionally, both of the methods above require supervisor approval and all City staff approving electronic time sheets related to CDBG/HOME grants have been instructed to ensure time entries are correct and eligible, with technical assistance provided by the City?s CDBG/HOME grant administration staff as needed. All coding changes performed by finance department personnel will be sent via email for approval by supervisors until the payroll division can implement new procedures through the electronic time sheet system that will route approvals to supervisors through the established electronic workflow. Timesheet approval reviewers have since been updated to ensure proper supervisory personnel approves all timesheets in the event primary reviewers are absent or unable to approve.
2021-007
The City is a prime recipient and provided subawards totaling $135,000 to three recipients, each over the $30,000 reporting threshold. Three out of the three FFATA reports were filed for these recipients, but all were filed after the end of the month following the month in which the sub-grant was awarded. Questioned Costs: None noted. Context: The City is a prime recipient and provided subawards totaling $135,000 to three recipients, each over the $30,000 reporting threshold. Three out of the three FFATA reports were filed for these recipients, but all were filed after the end of the month following the month in which the sub-grant was awarded. Cause: The City was not aware of the FFATA reporting requirements. Effect: The City is not in compliance with the FFATA reporting requirements. Repeat Finding: Repeat of prior year finding number 2021-008. Recommendation: We recommend the City implement policies and procedures to ensure that FFATA reporting occurs for all subawards of $30,000 or more for all federal awards and that the reporting be performed timely.
Show full finding ▾Hide full finding ▴Federal Program Name: CDBG Entitlement Grants Cluster: Community Development Block Grant (CDBG) Assistance Listing Number: 14.218 Federal Award Identification Number and Year: B-21-MC-06-0593; B-20-MC-06-0593; B-19-MC-06-0593; B-18-MC-06-0593; B-17-MC-06-0593; B-16-MC-06-0593; Award Years 2021, 2020, 2019, 2018, 2017, and 2016 Award Period: Fiscal Year 2021-2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance (Reporting) ? Other Matter (Reporting) Criteria or Specific Requirement: Reporting: Prime recipients awarded a federal grant greater than or equal to $30,000 are subject to FFATA sub-award reporting requirements as outlined in the Office of Management and Budgets guidance issued August 13, 2020. The prime recipient is required to file a FFATA subaward report by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. Condition: The City is a prime recipient and provided subawards totaling $135,000 to three recipients, each over the $30,000 reporting threshold. Three out of the three FFATA reports were filed for these recipients, but all were filed after the end of the month following the month in which the sub-grant was awarded. Questioned Costs: None noted. Context: The City is a prime recipient and provided subawards totaling $135,000 to three recipients, each over the $30,000 reporting threshold. Three out of the three FFATA reports were filed for these recipients, but all were filed after the end of the month following the month in which the sub-grant was awarded. Cause: The City was not aware of the FFATA reporting requirements. Effect: The City is not in compliance with the FFATA reporting requirements. Repeat Finding: Repeat of prior year finding number 2021-008. Recommendation: We recommend the City implement policies and procedures to ensure that FFATA reporting occurs for all subawards of $30,000 or more for all federal awards and that the reporting be performed timely.
Views of Responsible Officials: In May 2022, it was brought to the City?s CDBG/HOME grant staff?s attention that subawards over the amount of $30,000 must be reported under the Federal Funding Accountability and Transparency Act (FFATA). Staff contacted the City?s Department of Housing and Urban Development (HUD) representative to confirm Community Development Block Grant subawards must be entered into the Subaward Reporting System. The HUD representative confirmed this requirement. The City?s CDBG/HOME grant staff began regular reporting in the system quarterly starting with the first quarter of the 2022 2023 fiscal year and has retroactively reported for fiscal year 2021-2022. In order for subawards to be entered into the system, the sub-awardee must possess a Unique Entity ID and other pertinent data that is collected with the initial grant application, which had not previously been collected in full but was collected at the subrecipient application stage beginning with the 2022-2023 fiscal year. Moving forward, City staff will confirm FFATA reporting completion in conjunction with the forwarding of official CDBG award contracts to the City Manager for final signatures, which will ensure timely filing in accordance with FFATA requirements.
2021-008
The City was not able to provide supporting documentation that the verification of suspension or debarment was performed prior to entering into the contract. Questioned Costs: None noted. Context: There were only two vendors during fiscal year 2021-2022 that were a covered transaction for this program. While the City did not perform the suspension and debarment verification for these vendors tested, the vendors were not on the suspended and debarred listing. Cause: The City did not maintain supporting documentation that the verification of suspension or debarment was performed prior to entering into the contract. The vendors are routinely used for IT procurement and the City has ongoing contracts. The City was under the impression that a separate verification of this vendor was not necessary. Effect: No vendors were noted that were suspended or debarred; however, there was no documentation retained to verify that the City followed their internal controls to ensure the vendor was not suspended or debarred prior to entering into the transactions. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the City implement procedures to ensure that verification documentation for suspension and debarment is maintained to support the City's internal control over compliance.
Show full finding ▾Hide full finding ▴Federal Program Name: COVID-19 Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Award Identification Number and Year: None Award Period: Fiscal Year 2021-2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance (Suspension and Debarment) ? Other Matter (Suspension and Debarment) Criteria or Specific Requirement: Suspension and Debarment: 2 CFR Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards requires compliance with the provisions of suspension and debarment. The City should have internal controls designed to ensure compliance with those provisions. Condition: The City was not able to provide supporting documentation that the verification of suspension or debarment was performed prior to entering into the contract. Questioned Costs: None noted. Context: There were only two vendors during fiscal year 2021-2022 that were a covered transaction for this program. While the City did not perform the suspension and debarment verification for these vendors tested, the vendors were not on the suspended and debarred listing. Cause: The City did not maintain supporting documentation that the verification of suspension or debarment was performed prior to entering into the contract. The vendors are routinely used for IT procurement and the City has ongoing contracts. The City was under the impression that a separate verification of this vendor was not necessary. Effect: No vendors were noted that were suspended or debarred; however, there was no documentation retained to verify that the City followed their internal controls to ensure the vendor was not suspended or debarred prior to entering into the transactions. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the City implement procedures to ensure that verification documentation for suspension and debarment is maintained to support the City's internal control over compliance.
Views of Responsible Officials: Finance purchasing staff will hold annual training which will include requirements for all purchases, based on funding, to go through this division to ensure that all required verifications and paperwork are adhered to by city personnel. Purchasing staff will also distribute a Purchasing Checklist to each department confirming the requirement to process grant funded projects/procurements through the Purchasing Division which is set up to verify suspension and disbarment status of potential awarded suppliers/contractors.
FAC accepted this audit on September 1, 2022 — management decision was due March 1, 2023.
From July 2020 through March 2021, personal services charged were recorded based on budget to the program and an after-the-fact determination of personal services charged to the program was not conducted and adjustments, if necessary, were not recorded. In addition, The City corrected this matter beginning April 2021 and this finding did not apply from April through June 2021. In addition, in some cases, overtime charges occurred that were not supported by timesheets. Questioned costs: The amount of known salaries and fringe benefits charged to the federal program that were based on budgeted percentages during the fiscal year 2020-2021 is $236,386. The amount of overtime charged to the federal program that was not supported by timesheets was $570. The likely amount of questioned costs for overtime charges cannot be determined since there are no records that accurately reflect the actual work performed. Context: Payroll and fringe benefits were charged based on budgeted percentages in 3 of 17 samples tested. There was a total of 20 pay periods where five employees' wages and fringe benefits were charged to the program based on budgeted percentages. Overtime was charged without a supporting timesheet in 2 out of 17 samples tested. Cause: The City was not aware of the requirement to make an after-the-fact accounting of time spent on the program. The condition was corrected once brought to the attention of City management in the prior year single audit. Overtime charges that occurred without a timesheet was an error not identified or corrected through the internal control process. Effect: The amount of personal services charged to the Federal award may be over or understated. Repeat Finding: Repeat of prior year finding number 2020-008. Recommendation: We recommend that personnel track their actual time spent working on the program (including all other hours worked) so that an after-the-fact adjustments can be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated. This recommendation was implemented by the City beginning April 2021. We recommend that the City implement policies and procedures to review all charges to federal awards, including overtime, to verify amounts are supported by timesheets that are approved by appropriate supervisors. Views of responsible officials: Since early 2021, City Staff funded by CDBG/HOME entitlement grants have utilized electronic timesheets to track time spent working on the various programs by adjusting their weekly time entries to reflect actual time spent on a specific eligible activity. In some cases, these activities are also tracked by a Journal Entry (JE) with a description of the eligible activities and an hourly breakdown provided to supplement the JE. These tracking methods ensure amounts charged to the Federal awards are accurate, allowable, and properly allocated. Additionally, overtime hours inadvertently entered by Code Enforcement Staff has been addressed by Code Enforcement Supervisors who are communicating with their employees to ensure they are tracking time and completing electronic time sheets correctly. All coding changes performed by Finance department personnel will be sent via email for approval by supervisors until the Payroll division can implement new procedures through the electronic timesheet system that will route approvals to supervisors through the established workflow. Additionally, case management / GIS system adjustments at a parcel level will be developed to further improve data correlation between claimed staff hours and program specific locations.
Show full finding ▾Hide full finding ▴2021-006 Federal Agency: United States Department of Housing and Urban Development Federal Program Name: CDBG Entitlement Grants Cluster: Community Development Block Grant (CDBG) Assistance Listing Number: 14.218 Federal Award Identification Number and Year: B-20-MC-06-0593; B-19-MC-06-0593; B-18-MC-06-0593; B-17-MC-06-0593; Award Years 2020, 2019, 2018, and 2017 Award Period: Fiscal Year 2020-2021 Type of Finding: ? Significant Deficiency in Internal Control over Compliance (Allowable Costs) ? Other Matter (Allowable Costs) Criteria or specific requirement: Allowable Costs: Uniform Guidance Title 2, Subtitle A, Chapter II, Part 200, Subpart E, ?200.430 allows for budget estimates for personal services to be used for interim accounting purposes provided, among other criteria, that ?The non-Federal entity?s system of internal controls includes processes to review after-the-fact interim charges made to a Federal awards based on budget estimates. All necessary adjustments must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.? Allowable Costs: Uniform Guidance Title 2, Subtitle A, Chapter II, Part 200, Subpart E, ?200.430 requires payroll records to support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: From July 2020 through March 2021, personal services charged were recorded based on budget to the program and an after-the-fact determination of personal services charged to the program was not conducted and adjustments, if necessary, were not recorded. In addition, The City corrected this matter beginning April 2021 and this finding did not apply from April through June 2021. In addition, in some cases, overtime charges occurred that were not supported by timesheets. Questioned costs: The amount of known salaries and fringe benefits charged to the federal program that were based on budgeted percentages during the fiscal year 2020-2021 is $236,386. The amount of overtime charged to the federal program that was not supported by timesheets was $570. The likely amount of questioned costs for overtime charges cannot be determined since there are no records that accurately reflect the actual work performed. Context: Payroll and fringe benefits were charged based on budgeted percentages in 3 of 17 samples tested. There was a total of 20 pay periods where five employees' wages and fringe benefits were charged to the program based on budgeted percentages. Overtime was charged without a supporting timesheet in 2 out of 17 samples tested. Cause: The City was not aware of the requirement to make an after-the-fact accounting of time spent on the program. The condition was corrected once brought to the attention of City management in the prior year single audit. Overtime charges that occurred without a timesheet was an error not identified or corrected through the internal control process. Effect: The amount of personal services charged to the Federal award may be over or understated. Repeat Finding: Repeat of prior year finding number 2020-008. Recommendation: We recommend that personnel track their actual time spent working on the program (including all other hours worked) so that an after-the-fact adjustments can be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated. This recommendation was implemented by the City beginning April 2021. We recommend that the City implement policies and procedures to review all charges to federal awards, including overtime, to verify amounts are supported by timesheets that are approved by appropriate supervisors. Views of responsible officials: Since early 2021, City Staff funded by CDBG/HOME entitlement grants have utilized electronic timesheets to track time spent working on the various programs by adjusting their weekly time entries to reflect actual time spent on a specific eligible activity. In some cases, these activities are also tracked by a Journal Entry (JE) with a description of the eligible activities and an hourly breakdown provided to supplement the JE. These tracking methods ensure amounts charged to the Federal awards are accurate, allowable, and properly allocated. Additionally, overtime hours inadvertently entered by Code Enforcement Staff has been addressed by Code Enforcement Supervisors who are communicating with their employees to ensure they are tracking time and completing electronic time sheets correctly. All coding changes performed by Finance department personnel will be sent via email for approval by supervisors until the Payroll division can implement new procedures through the electronic timesheet system that will route approvals to supervisors through the established workflow. Additionally, case management / GIS system adjustments at a parcel level will be developed to further improve data correlation between claimed staff hours and program specific locations.
Since early 2021, City Staff funded by CDBG/HOME entitlement grants have utilized electronic timesheets to track time spent working on the various programs by adjusting their weekly time entries to reflect actual time spent on a specific eligible activity. In some cases, these activities are also tracked by a Journal Entry (JE) with a description of the eligible activities and an hourly breakdown provided to supplement the JE. These tracking methods ensure amounts charged to the Federal awards are accurate, allowable, and properly allocated. Additionally, overtime hours inadvertently entered by Code Enforcement Staff has been addressed by Code Enforcement Supervisors who are communicating with their employees to ensure they are tracking time and completing electronic time sheets correctly. All coding changes performed by Finance department personnel will be sent via email for approval by supervisors until the Payroll division can implement new procedures through the electronic timesheet system that will route approvals to supervisors through the established workflow. Additionally, case management / GIS system adjustments at a parcel level will be developed to further improve data correlation between claimed staff hours and program specific locations.
2020-008
After the findings the City received in the prior year audit, the City revised the internal controls over payroll to require a supervisor's review and approval of hours charged to federal awards on the electronic timesheets, which is in line with the requirements of the Uniform Guidance. In 2 out of 17 payroll transactions tested, there was no supervisor approval of hours charged to the federal award, which was a lack of internal controls. Questioned costs: None since hours worked were documented (except as noted in finding 2021-005), but the support for the supervisor approval was not able to be inspected and verified. Context: The payroll charges without supervisor approval totals $3,980 and occurred in 2 out of 17 transactions tested. Cause: Upon receiving the prior year finding, the City was not able to implement the payroll internal control changes for all transactions in the next fiscal year since part of the year had passed before the audit procedures could be performed. Effect: The payroll records are not in compliance with the requirements of the Uniform Guidance. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the City ensure all timesheets require approval of hours charged to federal awards by a supervisor so that the City is in compliance with the Uniform Guidance payroll documentation requirements. Views of responsible officials: Since early 2021, City Staff funded by CDBG/HOME entitlement grants have utilized electronic timesheets to track time spent working on the various programs by adjusting their weekly time entries to reflect actual time spent on a specific eligible activity. In some cases, these activities are also tracked by a Journal Entry (JE) with a description of the eligible activities and an hourly breakdown provided to supplement the JE. These tracking methods ensure amounts charged to the Federal awards are accurate, allowable, and properly allocated. Additionally, both of the methods above require supervisor approval and all City Staff approving electronic time sheets related to CDBG/HOME grants have been instructed to ensure time entries are correct and eligible, with technical assistance provided by the City?s CDBG/HOME grant administration Staff as needed. All coding changes performed by Finance department personnel will be sent via email for approval by supervisors until the Payroll division can implement new procedures through the electronic time sheet system that will route approvals to supervisors through the established workflow.
Show full finding ▾Hide full finding ▴2021-007 Federal Program Name: CDBG Entitlement Grants Cluster: Community Development Block Grant (CDBG) Assistance Listing Number: 14.218 Federal Award Identification Number and Year: B-20-MC-06-0593; B-19-MC-06-0593; B-18-MC-06-0593; B-17-MC-06-0593; Award Years 2020, 2019, 2018, and 2017 Section III ? Findings and Questioned Costs ? Major Federal Programs Award Period: Fiscal Year 2020-2021 Type of Finding: ? Significant Deficiency in Internal Control over Compliance (Allowable Costs) ? Other Matter (Allowable Costs) Criteria or specific requirement: Allowable Costs: Uniform Guidance Title 2, Subtitle A, Chapter II, Part 200, Subpart E, ?200.430 requires payroll charges to be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Condition: After the findings the City received in the prior year audit, the City revised the internal controls over payroll to require a supervisor's review and approval of hours charged to federal awards on the electronic timesheets, which is in line with the requirements of the Uniform Guidance. In 2 out of 17 payroll transactions tested, there was no supervisor approval of hours charged to the federal award, which was a lack of internal controls. Questioned costs: None since hours worked were documented (except as noted in finding 2021-005), but the support for the supervisor approval was not able to be inspected and verified. Context: The payroll charges without supervisor approval totals $3,980 and occurred in 2 out of 17 transactions tested. Cause: Upon receiving the prior year finding, the City was not able to implement the payroll internal control changes for all transactions in the next fiscal year since part of the year had passed before the audit procedures could be performed. Effect: The payroll records are not in compliance with the requirements of the Uniform Guidance. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the City ensure all timesheets require approval of hours charged to federal awards by a supervisor so that the City is in compliance with the Uniform Guidance payroll documentation requirements. Views of responsible officials: Since early 2021, City Staff funded by CDBG/HOME entitlement grants have utilized electronic timesheets to track time spent working on the various programs by adjusting their weekly time entries to reflect actual time spent on a specific eligible activity. In some cases, these activities are also tracked by a Journal Entry (JE) with a description of the eligible activities and an hourly breakdown provided to supplement the JE. These tracking methods ensure amounts charged to the Federal awards are accurate, allowable, and properly allocated. Additionally, both of the methods above require supervisor approval and all City Staff approving electronic time sheets related to CDBG/HOME grants have been instructed to ensure time entries are correct and eligible, with technical assistance provided by the City?s CDBG/HOME grant administration Staff as needed. All coding changes performed by Finance department personnel will be sent via email for approval by supervisors until the Payroll division can implement new procedures through the electronic time sheet system that will route approvals to supervisors through the established workflow.
Since early 2021, City Staff funded by CDBG/HOME entitlement grants have utilized electronic timesheets to track time spent working on the various programs by adjusting their weekly time entries to reflect actual time spent on a specific eligible activity. In some cases, these activities are also tracked by a Journal Entry (JE) with a description of the eligible activities and an hourly breakdown provided to supplement the JE. These tracking methods ensure amounts charged to the Federal awards are accurate, allowable, and properly allocated. Additionally, both of the methods above require supervisor approval and all City Staff approving electronic time sheets related to CDBG/HOME grants have been instructed to ensure time entries are correct and eligible, with technical assistance provided by the City?s CDBG/HOME grant administration Staff as needed. All coding changes performed by Finance department personnel will be sent via email for approval by supervisors until the Payroll division can implement new procedures through the electronic time sheet system that will route approvals to supervisors through the established workflow
The City is a prime recipient and provided subawards totaling $192,538 to five recipients, each over the $30,000 reporting threshold. No FFATA reports were filed for these five recipients. Questioned costs: None. Context: The City is a prime recipient and provided subawards totaling $192,538 to five recipients, each over the $30,000 reporting threshold. No FFATA reports were filed for these five recipients. Cause: The City was not aware of the FFATA reporting requirements. Effect: The City is not in compliance with the FFATA reporting requirements. Repeat Finding: Not a repeat finding. Recommendation: We recommend that the City implement policies and procedures to ensure FFATA reporting is completed, reviewed, approved, and filed for all federal awards when subawards are made over the reporting threshold. Views of responsible officials: In May 2022, it was brought to the City?s CDBG/HOME grant staff?s attention that subawards over the amount of $30,000 must be reported under the Federal Funding Accountability and Transparency Act. Staff contacted the City?s Department of Housing and Urban Development (HUD) representative to confirm Community Development Block Grant subawards must be entered into the Subaward Reporting System. The HUD representative confirmed this requirement. The City?s CDBG/HOME grant staff will begin regular reporting in the system quarterly starting with the first quarter of the 2022-2023 fiscal year and will retroactively report for fiscal year 2021-2022. In order for subawards to be entered into the system, the sub-awardee must possess a Unique Entity ID and other pertinent data that is collected with the initial grant application, which had not previously been collected in full but will be collected at the subrecipient application stage beginning with the 2022-2023 fiscal year.
Show full finding ▾Hide full finding ▴2021-008 Federal Program Name: CDBG Entitlement Grants Cluster: Community Development Block Grant (CDBG) Assistance Listing Number: 14.218 Federal Award Identification Number and Year: B-20-MC-06-0593; B-19-MC-06-0593; B-18-MC-06-0593; B-17-MC-06-0593; Award Years 2020, 2019, 2018, and 2017 Award Period: Fiscal Year 2020-2021 Type of Finding: ? Significant Deficiency in Internal Control over Compliance (Reporting) ? Other Matter (Reporting) Award Period: Fiscal Year 2020-2021 Criteria or specific requirement: Reporting: Prime recipients awarded a federal grant greater than or equal to $30,000 are subject to Federal Funding Accountability and Transparency Act (FFATA) sub-award reporting requirements as outlined in the Office of Management and Budgets guidance issued August 13, 2020. The prime recipient is required to file a FFATA subaward report by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. Condition: The City is a prime recipient and provided subawards totaling $192,538 to five recipients, each over the $30,000 reporting threshold. No FFATA reports were filed for these five recipients. Questioned costs: None. Context: The City is a prime recipient and provided subawards totaling $192,538 to five recipients, each over the $30,000 reporting threshold. No FFATA reports were filed for these five recipients. Cause: The City was not aware of the FFATA reporting requirements. Effect: The City is not in compliance with the FFATA reporting requirements. Repeat Finding: Not a repeat finding. Recommendation: We recommend that the City implement policies and procedures to ensure FFATA reporting is completed, reviewed, approved, and filed for all federal awards when subawards are made over the reporting threshold. Views of responsible officials: In May 2022, it was brought to the City?s CDBG/HOME grant staff?s attention that subawards over the amount of $30,000 must be reported under the Federal Funding Accountability and Transparency Act. Staff contacted the City?s Department of Housing and Urban Development (HUD) representative to confirm Community Development Block Grant subawards must be entered into the Subaward Reporting System. The HUD representative confirmed this requirement. The City?s CDBG/HOME grant staff will begin regular reporting in the system quarterly starting with the first quarter of the 2022-2023 fiscal year and will retroactively report for fiscal year 2021-2022. In order for subawards to be entered into the system, the sub-awardee must possess a Unique Entity ID and other pertinent data that is collected with the initial grant application, which had not previously been collected in full but will be collected at the subrecipient application stage beginning with the 2022-2023 fiscal year.
In May 2022, it was brought to the City?s CDBG/HOME grant staff?s attention that subawards over the amount of $30,000 must be reported under the Federal Funding Accountability and Transparency Act. Staff contacted the City?s Department of Housing and Urban Development (HUD) representative to confirm Community Development Block Grant subawards must be entered into the Subaward Reporting System. The HUD representative confirmed this requirement. The City?s CDBG/HOME grant staff will begin regular reporting in the system quarterly starting with the first quarter of the 2022-2023 fiscal year and will retroactively report for fiscal year 2021-2022. In order for subawards to be entered into the system, the sub-awardee must possess a Unique Entity ID and other pertinent data that is collected with the initial grant application, which had not previously been collected in full but will be collected at the subrecipient application stage beginning with the 2022-2023 fiscal year.
FAC accepted this audit on March 28, 2021 — management decision was due September 28, 2021.
The City's purchasing policy is less restrictive than the Uniform Guidance in that the policy only requires quotes for expenditures in excess of $5,000, which is higher than the $3,500 limit required by the Uniform Guidance. No issues were noted as a result of testing only that the policies have not been updated for the Uniform Guidance. The City did not have the above written policies. Questioned costs: None noted. Context: Not applicable - lack of required written policies and procedures. Cause: The City did not realize written procedures were required for the Uniform Guidance. Effect: The City was not in compliance with requirements of the Uniform Guidance for written procedures and some purchases could have been made without the required number of quotes and corresponding documentation. Repeat Finding: Repeat of prior year finding number 2019-004. Recommendation: We recommend that the City establish written policies and procedures in line with the requirements of the Uniform Guidance.
Show full finding ▾Hide full finding ▴Criteria or specific requirement: Procurement: ($3,500 or less) may be awarded without soliciting competitive quotations, (b) small purchases ($3,500 to $150,000) require price or rate quotations from an adequate number of qualified sources, and (c) sealed bids required for purchases in excess of $150,000. The Uniform Guidance has various requirements for written policies and procedures. Section 200.318 of the Uniform Guidance requires written standards of conduct covering conflicts of interest and governing the performance of its employees engaged in the selection, award, and administration of contracts. Section 200.430 of the Uniform Guidance requires established written policies regarding compensation. Condition: The City's purchasing policy is less restrictive than the Uniform Guidance in that the policy only requires quotes for expenditures in excess of $5,000, which is higher than the $3,500 limit required by the Uniform Guidance. No issues were noted as a result of testing only that the policies have not been updated for the Uniform Guidance. The City did not have the above written policies. Questioned costs: None noted. Context: Not applicable - lack of required written policies and procedures. Cause: The City did not realize written procedures were required for the Uniform Guidance. Effect: The City was not in compliance with requirements of the Uniform Guidance for written procedures and some purchases could have been made without the required number of quotes and corresponding documentation. Repeat Finding: Repeat of prior year finding number 2019-004. Recommendation: We recommend that the City establish written policies and procedures in line with the requirements of the Uniform Guidance.
SIGNIFICANT DEFICIENCY 2020-007 Procurement: ($3,500 or less) may be awarded without soliciting competitive quotations, (b) small purchases ($3,500 to $150,000) require price or rate quotations from an adequate number of qualified sources, and (c) sealed bids required for purchases in excess of $150,000. The Uniform Guidance has various requirements for written policies and procedures. Section 200.318 of the Uniform Guidance requires written standards of conduct covering conflicts of interest and governing the performance of its employees engaged in the selection, award, and administration of contracts. Section 200.430 of the Uniform Guidance requires established written policies regarding compensation. Recommendation: The auditors recommend that the City establish written policies and procedures in line with the requirements of the Uniform Guidance. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned/taken in response to finding: Management is reviewing the City?s current Purchasing Policy and will be amending it as needed to comply with the Uniform Guidance in any instance that it does not clearly spell out the guidelines. The City does ensure compliance with the Uniform Guidance for all grant requirements. The new policy is in draft format for revisions at this time. Name(s) of the contact person(s) responsible for corrective action: Bobby Magee and John Mendiola Planned completion date for corrective action plan: 06/30/2021
2019-004
Personal services charged were recorded based on budget to the program and an after-the-fact determination of personal services charged to the program was not conducted and adjustments, if necessary, were not recorded. Questioned costs: The amount of known salaries and fringe benefits charged to the federal program that were based on budgeted percentages during the fiscal year 2019-2020 is $194,666. The amount of questioned costs cannot be determined since there are no records that accurately reflect the actual work performed. Context: Payroll and fringe benefits were charged based on budgeted percentages in 9 of 25 samples tested. There was a total of 26 pay periods where four employees' wages and fringe benefits were charged to the program based on budgeted percentages. Cause: The City was not aware of the requirement to make an after-the-fact accounting of time spent on the program. Effect: The amount of personal services charged to the Federal award may be over or understated. Repeat Finding: Not a repeat finding. Recommendation: We recommend that personnel track their actual time spent working on the program (including all other hours worked) so that an after-the-fact adjustments can be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.
Show full finding ▾Hide full finding ▴Criteria or specific requirement: Allowable Costs: Uniform Guidance Title 2, Subtitle A, Chapter II, Part 200, Subpart E, ?200.430 allows for budget estimates for personal services to be used for interim accounting purposes provided, among other criteria, that ?The non-Federal entity?s system of internal controls includes processes to review after-the-fact interim charges made to a Federal awards based on budget estimates. All necessary adjustments must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.? Condition: Personal services charged were recorded based on budget to the program and an after-the-fact determination of personal services charged to the program was not conducted and adjustments, if necessary, were not recorded. Questioned costs: The amount of known salaries and fringe benefits charged to the federal program that were based on budgeted percentages during the fiscal year 2019-2020 is $194,666. The amount of questioned costs cannot be determined since there are no records that accurately reflect the actual work performed. Context: Payroll and fringe benefits were charged based on budgeted percentages in 9 of 25 samples tested. There was a total of 26 pay periods where four employees' wages and fringe benefits were charged to the program based on budgeted percentages. Cause: The City was not aware of the requirement to make an after-the-fact accounting of time spent on the program. Effect: The amount of personal services charged to the Federal award may be over or understated. Repeat Finding: Not a repeat finding. Recommendation: We recommend that personnel track their actual time spent working on the program (including all other hours worked) so that an after-the-fact adjustments can be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.
SIGNIFICANT DEFICIENCY 2020-008 Allowable Costs: Uniform Guidance Title 2, Subtitle A, Chapter II, Part 200, Subpart E, ?200.430 allows for budget estimates for personal services to be used for interim accounting purposes provided, among other criteria, that ?The non-Federal entity?s system of internal controls includes processes to review after-the-fact interim charges made to a Federal awards based on budget estimates. All necessary adjustments must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.? Recommendation: Auditors recommend that personnel track their actual time spent working on the program (including all other hours worked) so that an after-the-fact adjustments can be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned/taken in response to finding: Staff working in CDBG entitlement grants will track time working on the program on one of two ways as follows: (1) Staff working all or a majority of their time on CDBG grants will adjust their weekly timesheets to reflect the budgeted percentages with standardized entries that can be adjusted based on varying workloads; and (2) Staff working partially or as needed on CDBG grants will track their time on a yearly basis and document the hours worked and work category (example yearly timesheet attached). These tracking methods will ensure amounts charged to the Federal award are accurate, allowable, and properly allocated. Name(s) of the contact person(s) responsible for corrective action: Alex Jauregui Planned completion date for corrective action plan: 04/01/2021
City employee wages and fringe benefits are charged to grants or other general ledger accounts based on a budgeted percentage. City employee hours are tracked and documented using exception-based reporting where only sick, vacation, other leave, and hours worked outside of the normal budgeted account are tracked and documented in a timesheet. In fiscal year 2019-2020 payroll and fringe charged to CDBG included some employees that tracked actual hours worked and recorded these hours in a timesheet; however, the timesheet did not also include the actual hours worked for the budgeted account. Questioned costs: None since payroll charged was based on actual hours worked. Context: Payroll was charged based on actual hours worked where the timesheet did not also reflect other non-exception based hours on 8 of 25 samples tested. There were a total of 26 pay periods where ten employees' wages and fringe benefits totaling $190,667 were charged to the program based on actual hours worked, but where the timesheet did not reflect the remaining hours worked in the time period. Cause: The City was not aware of the requirement that timesheets should reflect all hours actually worked when charging such payroll costs to Federal grants. Effect: The payroll records are not in compliance with the requirements of the Uniform Guidance. Repeat Finding: Not a repeat finding. Recommendation: We recommend that personnel track their actual time spent working on the program (including all other hours worked) so that the City is in compliance with the Uniform Guidance payroll documentation requirements.
Show full finding ▾Hide full finding ▴Criteria or specific requirement: Allowable Costs: Uniform Guidance Title 2, Subtitle A, Chapter II, Part 200, Subpart E, ?200.430 requires payroll records to support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: City employee wages and fringe benefits are charged to grants or other general ledger accounts based on a budgeted percentage. City employee hours are tracked and documented using exception-based reporting where only sick, vacation, other leave, and hours worked outside of the normal budgeted account are tracked and documented in a timesheet. In fiscal year 2019-2020 payroll and fringe charged to CDBG included some employees that tracked actual hours worked and recorded these hours in a timesheet; however, the timesheet did not also include the actual hours worked for the budgeted account. Questioned costs: None since payroll charged was based on actual hours worked. Context: Payroll was charged based on actual hours worked where the timesheet did not also reflect other non-exception based hours on 8 of 25 samples tested. There were a total of 26 pay periods where ten employees' wages and fringe benefits totaling $190,667 were charged to the program based on actual hours worked, but where the timesheet did not reflect the remaining hours worked in the time period. Cause: The City was not aware of the requirement that timesheets should reflect all hours actually worked when charging such payroll costs to Federal grants. Effect: The payroll records are not in compliance with the requirements of the Uniform Guidance. Repeat Finding: Not a repeat finding. Recommendation: We recommend that personnel track their actual time spent working on the program (including all other hours worked) so that the City is in compliance with the Uniform Guidance payroll documentation requirements.
SIGNIFICANT DEFICIENCY 2020-009 Allowable Costs: Uniform Guidance Title 2, Subtitle A, Chapter II, Part 200, Subpart E, ?200.430 requires payroll records to support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.Recommendation: Auditors recommend that personnel track their actual time spent working on the program (including all other hours worked) so that the City is in compliance with the Uniform Guidance payroll documentation requirements. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned/taken in response to finding: Staff working in Federal awards including CDBG entitlement grants will track time working on the program on one of two ways as follows: (1) Staff working all or a majority of their time on CDBG grants will adjust their weekly timesheets to reflect the budgeted percentages with standardized entries that can be adjusted based on varying workloads; and (2) Staff working partially or as needed on CDBG grants will track their time on a yearly basis and document the hours worked and work category (example yearly timesheet attached). These tracking methods will ensure amounts charged to the Federal award are accurate, allowable, and properly allocated while also supporting the distribution of applicable employee?s salary/wages. Name(s) of the contact person(s) responsible for corrective action: Alex Jauregui Planned completion date for corrective action plan: 04/01/2021
FAC accepted this audit on February 17, 2020 — management decision was due August 17, 2020.
The City's purchasing policy is less restrictive than the Uniform Guidance in that the policy only requires quotes for expenditures in excess of $5,000, which is higher than the $3,500 limit required by the Uniform Guidance. No issues were noted as a result of testing only that the policies have not been updated for the Uniform Guidance. The City did not have the above written policies. Questioned Costs: None noted. Perspective Information: Not applicable. Cause: The City did not realize written procedures were required for the Uniform Guidance. Effect: The City was not in compliance with requirements of the Uniform Guidance for written procedures. Recommendation: We recommend that the City establish written policies and procedures in line with the requirements of the Uniform Guidance.
Show full finding ▾Hide full finding ▴Criteria: Uniform Guidance section 200.320 requires the following for procurement: (a) micro-purchases ($3,500 or less) may be awarded without soliciting competitive quotations, (b) small purchases ($3,500 to $150,000) require price or rate quotations from an adequate number of qualified sources, and (c) sealed bids required for purchases in excess of $150,000. The Uniform Guidance has various requirements for written policies and procedures. Section 200.318 of the Uniform Guidance requires written standards of conduct covering conflicts of interest and governing the performance of its employees engaged in the selection, award, and administration of contracts. Section 200.430 of the Uniform Guidance requires established written policies regarding compensation. Condition: The City's purchasing policy is less restrictive than the Uniform Guidance in that the policy only requires quotes for expenditures in excess of $5,000, which is higher than the $3,500 limit required by the Uniform Guidance. No issues were noted as a result of testing only that the policies have not been updated for the Uniform Guidance. The City did not have the above written policies. Questioned Costs: None noted. Perspective Information: Not applicable. Cause: The City did not realize written procedures were required for the Uniform Guidance. Effect: The City was not in compliance with requirements of the Uniform Guidance for written procedures. Recommendation: We recommend that the City establish written policies and procedures in line with the requirements of the Uniform Guidance.
FINDINGS AND QUESTIONED COSTS - MAJOR FEDERAL A WARDS PROGRAM AUDIT NONCOMPLIANCE - NAME OF COMPLIANCE REQUIREMENT: UNIFORM GUIDANCE WRITTEN PROCEDURES 2019-004 TITLE OF FINDING: Uniform Guidance Written Procedures Major Program: U.S. Department of Transportation: Federal Aviation Association Direct Program; Airport Improvement Program; 20.106; 3-06-0359-23 and 3-06-0359-24 Recommendation: The City's purchasing policy is less restrictive than the Uniform Guidance in that the policy only requires quotes for expenditures in excess of $5,000, which is higher than the $3,500 limit required by the Uniform Guidance. No issues were noted as a result of testing. The recommendation is to update the policy for compliance with the Uniform Guidance. Action Taken: Management is reviewing the City's current Purchasing Policy and will be amending it as needed to comply with the Uniform Guidance in any instance that it does not clearly spell out the guidelines. The City does ensure compliance with the Uniform Guidance for all grant requirements.
FAC accepted this audit on February 5, 2019 — management decision was due August 5, 2019.
FAC accepted this audit on February 26, 2018 — management decision was due August 26, 2018.
FAC accepted this audit on February 24, 2017 — management decision was due August 24, 2017.
Data source: This information comes from the Federal Audit Clearinghouse, the official repository of Single Audit data. All data is public domain. Verify this organization's audit history at fac.gov.
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