Audit 304476

FY End
2022-09-30
Total Expended
$1.12M
Findings
4
Programs
4
Organization: City of Bandera (TX)
Year: 2022 Accepted: 2024-04-25

Organization Exclusion Status:

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Findings

ID Ref Severity Repeat Requirement
394583 2022-006 Material Weakness - C
394584 2022-007 - Yes P
971025 2022-006 Material Weakness - C
971026 2022-007 - Yes P

Contacts

Name Title Type
KM63BRCTG5J6 Allyson Wright Auditee
8305223189 Hayley Blocker Auditor
No contacts on file

Notes to SEFA

Title: Accounting Policies Accounting Policies: The accompanying schedule of expendtiures of federal awards ("the Schedule") includes the federal grant activity for the City of Bandera, Texas. The Information in the Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards ("Uniform Guidance"). Federal and state financial assistance was accounted for in the governmental fund types. The accounting and financial reporting treatment applied ot a fund is determined by its measurement focus. All federal expenditures were accounted for in the General Fund, Capital Projects Fund and Enterprise Funds, components of the Governmental Fund type and Proprietary Fund type. 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 reimbursement. No federal financial assistance has been provided to a subrecipient. Federal grants are considered to be earned to the extent of expenditures made under the provisions of the grant. De Minimis Rate Used: N Rate Explanation: The City has elected no to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The accompanying schedule of expendtiures of federal awards ("the Schedule") includes the federal grant activity for the City of Bandera, Texas. The Information in the Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards ("Uniform Guidance"). Federal and state financial assistance was accounted for in the governmental fund types. The accounting and financial reporting treatment applied ot a fund is determined by its measurement focus. All federal expenditures were accounted for in the General Fund, Capital Projects Fund and Enterprise Funds, components of the Governmental Fund type and Proprietary Fund type. 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 reimbursement. No federal financial assistance has been provided to a subrecipient. Federal grants are considered to be earned to the extent of expenditures made under the provisions of the grant.
Title: Indirect Cost Rate Accounting Policies: The accompanying schedule of expendtiures of federal awards ("the Schedule") includes the federal grant activity for the City of Bandera, Texas. The Information in the Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards ("Uniform Guidance"). Federal and state financial assistance was accounted for in the governmental fund types. The accounting and financial reporting treatment applied ot a fund is determined by its measurement focus. All federal expenditures were accounted for in the General Fund, Capital Projects Fund and Enterprise Funds, components of the Governmental Fund type and Proprietary Fund type. 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 reimbursement. No federal financial assistance has been provided to a subrecipient. Federal grants are considered to be earned to the extent of expenditures made under the provisions of the grant. De Minimis Rate Used: N Rate Explanation: The City has elected no to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The City has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance.

Finding Details

Condition: The City did not record and reconcile the escrow bank accounts containing the TWDB loan funds. The costs were recorded in the expense accounts and the deposits from the escrow bank accounts were recorded as grant revenue. Criteria: Uniform Guidance Compliance Supplement- Section C- Cash Management. Cause of Condition: THe City's lack of control policies and procedures over cash acccounts. Potential Effect of Condition: The grant revenue is overstated when the City records the escorw deposits as revenue in teh c apital projects fund and the assets are understated due to the City not recording the restricted cash escrow accounts. Recommendation: The City should record all bank accounts in the general ledger. Bank reconciliations should be prepared for all bank accounts. Monthly review and approval of the bank reconciliations and general ledger acccounts should be doen by someone in a supervisory role other than the person preparing the records.
Condition: Failure to file annual financial reports with the Texas Water Development Board in accordanc with bond covenants. Criteria: Filing annual financail reports on time with regulatory agencies is required to maintain compliance with debt covenants. Effect: The City's annual financail report was deliquent. Cause: Lack of monitoring by management and those charge with governance for compliance of debt covenants. Recommendation: We recommend the City monitor compliance requirements for all debt issued to ensure that reports are filed timely and the city remains in compliance with convenants.
Condition: The City did not record and reconcile the escrow bank accounts containing the TWDB loan funds. The costs were recorded in the expense accounts and the deposits from the escrow bank accounts were recorded as grant revenue. Criteria: Uniform Guidance Compliance Supplement- Section C- Cash Management. Cause of Condition: THe City's lack of control policies and procedures over cash acccounts. Potential Effect of Condition: The grant revenue is overstated when the City records the escorw deposits as revenue in teh c apital projects fund and the assets are understated due to the City not recording the restricted cash escrow accounts. Recommendation: The City should record all bank accounts in the general ledger. Bank reconciliations should be prepared for all bank accounts. Monthly review and approval of the bank reconciliations and general ledger acccounts should be doen by someone in a supervisory role other than the person preparing the records.
Condition: Failure to file annual financial reports with the Texas Water Development Board in accordanc with bond covenants. Criteria: Filing annual financail reports on time with regulatory agencies is required to maintain compliance with debt covenants. Effect: The City's annual financail report was deliquent. Cause: Lack of monitoring by management and those charge with governance for compliance of debt covenants. Recommendation: We recommend the City monitor compliance requirements for all debt issued to ensure that reports are filed timely and the city remains in compliance with convenants.