FAC Explorer

Audit 24895

FY End
2022-06-30
Total Expended
$14.01M
Findings
4
Programs
5
Organization: City of Grass Valley (CA)
Year: 2022 Accepted: 2023-03-16
Auditor: Smith and Newell CPAS

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
21722 2022-001 - - J
21723 2022-002 - - P
598164 2022-001 - - J
598165 2022-002 - - P

Programs

ALN Program Spent Major Findings
14.239 Home Investment Partnerships Program $7.94M - 0
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $3.70M Yes 1
21.027 Coronavirus State and Local Fiscal Recovery Funds $688,058 Yes 0
66.818 Brownfields Assessment and Cleanup Cooperative Agreements $122,631 - 0
20.205 Highway Planning and Construction $104,251 - 0

Contacts

Name Title Type
XEC7UKY93LA4 Andy Heath Auditee
5304584740 Norman Newell, CPA Auditor
No contacts on file

Notes to SEFA

Title: Loan/loan guarantee outstanding balances Accounting Policies: 1.REPORTING ENTITY The accompanying Schedule of Expenditures of Federal Awards presents the activity of all federal financial assistance programs of the City of Grass Valley, California (City). The City's reporting entity is defined in Note 1 to the City's basic financial statements. All federal awards received directly from federal agencies as well as federal awards passed through other government agencies are included on the Schedule of Expenditures of Federal Awards. The information in this Schedule is presented in accordance with 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). Because the Schedule presents only a selected portion of the operations of the City, it is not intended to and does not present the financial position, changes in net position or cash flows of the City. 2.BASIS OF ACCOUNTING Basis of accounting refers to when revenues and expenditures or expenses are recognized in the accounts and reported in the financial statements, regardless of the measurement focus applied. The accompanying Schedule of Expenditures of Federal Awards, is presented using the modified accrual basis of accounting for grants accounted for in the governmental fund types and the accrual basis of accounting for grants accounted for in the proprietary fund types, as described in the notes to the City financial statements. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowed or are limited as to reimbursements. In addition, the outstanding balance of prior years loans that have significant continuing compliance requirements have been included in total federal expenditures. 3.INDIRECT COST RATE The City has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. 4.RELATIONSHIP TO FEDERAL FINANCIAL REPORTS The amounts reported in the accompanying Schedule of Expenditures of Federal Awards agree or can be reconciled with amounts reported in the related federal financial assistance reports. 5.RELATIONSHIP TO BASIC FINANCIAL STATEMENTS The amounts reported in the accompanying Schedule of Expenditures of Federal Awards agree or can be reconciled with amounts reported in the City's basic financial statements. 6.PASS-THROUGH ENTITIES IDENTIFYING NUMBER When federal awards were received from a pass-through entity, the Schedule of Expenditures of Federal Awards shows, if available, the identifying number assigned by the pass-through entity. When no identifying number is shown, the City determined that no identifying number is assigned for the program or the City was unable to obtain an identifying number from the pass-through entity. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. COMMUNITY DEVELOPMENT BLOCK GRANTS/STATE'S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII (14.228) - Balances outstanding at the end of the audit period were $1,113,209. HOME INVESTMENT PARTNERSHIPS PROGRAM (14.239) - Balances outstanding at the end of the audit period were $7,981,929.

Finding Details

Finding 2022-001
Name: Community Development Block Grants/State?s Program and Non-Entitlement Grants in Hawaii CFDA #: 14.228 Federal Grantor: U.S. Department of Housing and Urban Development Pass Through Entity: State Department of Housing and Community Development Award No.: Various Year: 2021/2022 Compliance Requirement: Program Income Criteria Reporting of Program Income on the California Department of Housing and Community Development Program Income Report should agree to actual expended by the City during the fiscal year. Condition We noted that although the City reported expending $393,906 in program income during the 2021/2022 fiscal year, actual amounts expended equalled $0. Cause The City reported the amount of program income approved for expenditure instead of the actual amount of program income expended during the 2021/2022 fiscal year. Effect The City reported an incorrect amount of program income expended during the fiscal year on the annual Program Income Report. Questioned Cost No questioned costs were identified as a result of our procedures. Context We reviewed the annual Program Income Report and compared the amount reported as program income expenditures to the amounts recorded in the general ledger. Repeat Finding This is not a repeat finding. Recommendation We recommend that the City only report actual program income expended during the fiscal year instead of amounts authorized to be expended. Views of Responsible Officials and Planned Corrective Action Refer to separate Management?s Corrective Action Plan for views of responsible officials and management?s responses.
Finding 2022-002
2022-002 Name: Community Development Block Grants/State?s Program and Non-Entitlement Grants in Hawaii Assistance Listing #: 14.228 Federal Grantor: U.S. Department of Housing and Urban Development Pass Through Entity: State Department of Housing and Community Development Award No.: Various Year: 2021/2022 Compliance Requirement: Other Criteria Internal controls over the Schedule of Expenditures of Federal Awards (SEFA) requires that the City provide accurate Federal expenditure information to the City Auditor in a timely manner. Condition During our testing of major programs, we noted that the SEFA provided by the City at the beginning of the audit fieldwork contained errors in the federal expenditures. Expenditures included on the City?s SEFA provided at the beginning of the audit were more than actual expenditures by $495,601 in the programs listed above. Cause The City did not provide accurate information to include on the SEFA that was provided to us at the beginning of the audit. Effect The SEFA provided at the beginning of fieldwork was not materially correct and adjustments were needed to accurately reflect all Federal expenditures. Questioned Cost No questioned costs were identified as a result of our procedures. Context The condition noted above was identified during our procedures related to reporting over the programs. Repeat Finding This is not a repeat finding. Recommendation We recommend that the City provide the Auditor with accurate federal expenditure information at the beginning of audit fieldwork. Views of Responsible Officials and Planned Corrective Action Refer to separate Management?s Corrective Action Plan for views of responsible officials and management?s responses.
Finding 2022-001
Name: Community Development Block Grants/State?s Program and Non-Entitlement Grants in Hawaii CFDA #: 14.228 Federal Grantor: U.S. Department of Housing and Urban Development Pass Through Entity: State Department of Housing and Community Development Award No.: Various Year: 2021/2022 Compliance Requirement: Program Income Criteria Reporting of Program Income on the California Department of Housing and Community Development Program Income Report should agree to actual expended by the City during the fiscal year. Condition We noted that although the City reported expending $393,906 in program income during the 2021/2022 fiscal year, actual amounts expended equalled $0. Cause The City reported the amount of program income approved for expenditure instead of the actual amount of program income expended during the 2021/2022 fiscal year. Effect The City reported an incorrect amount of program income expended during the fiscal year on the annual Program Income Report. Questioned Cost No questioned costs were identified as a result of our procedures. Context We reviewed the annual Program Income Report and compared the amount reported as program income expenditures to the amounts recorded in the general ledger. Repeat Finding This is not a repeat finding. Recommendation We recommend that the City only report actual program income expended during the fiscal year instead of amounts authorized to be expended. Views of Responsible Officials and Planned Corrective Action Refer to separate Management?s Corrective Action Plan for views of responsible officials and management?s responses.
Finding 2022-002
2022-002 Name: Community Development Block Grants/State?s Program and Non-Entitlement Grants in Hawaii Assistance Listing #: 14.228 Federal Grantor: U.S. Department of Housing and Urban Development Pass Through Entity: State Department of Housing and Community Development Award No.: Various Year: 2021/2022 Compliance Requirement: Other Criteria Internal controls over the Schedule of Expenditures of Federal Awards (SEFA) requires that the City provide accurate Federal expenditure information to the City Auditor in a timely manner. Condition During our testing of major programs, we noted that the SEFA provided by the City at the beginning of the audit fieldwork contained errors in the federal expenditures. Expenditures included on the City?s SEFA provided at the beginning of the audit were more than actual expenditures by $495,601 in the programs listed above. Cause The City did not provide accurate information to include on the SEFA that was provided to us at the beginning of the audit. Effect The SEFA provided at the beginning of fieldwork was not materially correct and adjustments were needed to accurately reflect all Federal expenditures. Questioned Cost No questioned costs were identified as a result of our procedures. Context The condition noted above was identified during our procedures related to reporting over the programs. Repeat Finding This is not a repeat finding. Recommendation We recommend that the City provide the Auditor with accurate federal expenditure information at the beginning of audit fieldwork. Views of Responsible Officials and Planned Corrective Action Refer to separate Management?s Corrective Action Plan for views of responsible officials and management?s responses.