FAC Explorer

Audit 314916

FY End
2023-06-30
Total Expended
$1.54M
Findings
8
Programs
2
Organization: Town of Big Sandy (MT)
Year: 2023 Accepted: 2024-07-11
Auditor: Denning Downey and Associates Cpa's

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
478252 2023-009 Material Weakness - M
478253 2023-010 - - L
478254 2023-009 Material Weakness - M
478255 2023-010 - - L
1054694 2023-009 Material Weakness - M
1054695 2023-010 - - L
1054696 2023-009 Material Weakness - M
1054697 2023-010 - - L

Programs

ALN Program Spent Major Findings
66.468 Capitalization Grants for Drinking Water State Revolving Funds $750,000 Yes 2
21.027 Coronavirus State and Local Fiscal Recovery Funds $286,739 - 0

Contacts

Name Title Type
TJUXKBJFEPL4 Wendy Kleinsasser Auditee
4063782350 Robert Denning Auditor
No contacts on file

Notes to SEFA

Title: Loan Accounting Policies: Basis of Presentation and Significant Accounting Policies The accompanying Schedule of Expenditures of Federal Awards (SEFA) includes the federal grant activity of Town of Big Sandy, Chouteau County, Montana. The information in this schedule is presented in accordance with the requirements Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Because the schedule presents only a selected portion of the operations of the Town of Big Sandy, it is not intended to and does not present the financial position, changes in net position, or cash flows of the Town of Big Sandy. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in preparation of the basic financial statements. Expenditures reported on the schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The Town of Big Sandy has elected not to use the 10 percent de Minimis indirect cost rate as provided in Sec. 200.414 Indirect Costs under Uniform Guidance. The outstanding bonds on the 66.468 Drinking Water State Revolving Fund programs at June 30, 2023 were $750,000 and $247,000.

Finding Details

Finding 2023-009
2022/2023-009 Monitoring Subrecipients CFDA Title: Drinking Water State Revolving Fund CFDA Number: 66.468 Federal Award Number: Fiscal Year Ended June 30, 2023 Award #WRF-22515 and #WRF-22516 Federal Agency: United States Environmental Protection Agency Pass-through Entity: Montana Department of Natural Resources and Conservation Subrecipient: North Central Regional Water Authority Condition: The Town reimbursed North Central Regional Water Authority (NCRWA) $900,000 of federal sourced money for expenses related to a federal water project managed and owned by NCRWA. The assets acquired/built by NCRWA are the property of NCRWA. The $900,000 reimbursement is a sub-award of a federal grant from the City to NCRWA. The City did not monitor NCRWA to ensure the money was audited and spent in accordance with the federal requirements. Context: During the federal portion of the audit, we discovered the Town received two federal sourced loans totaling $900,000. We further discovered the money was transferred to another Montana local government to build a water project. Inquiry with the city disclosed no formal monitoring procedures. Criteria: The Town did not monitor the subrecipient (NCRWA) as required by 2CFR 200-part f. Additionally, the Town did not notify NCRWA of the federal requirements for the grant. Effect: The Town was not in compliance with the monitoring requirements of the federal grant. Additionally, NCRWA was not aware of the federal requirements. As a result, their audit did not include this federal grant as part of their annual audit. The federal audit opinion will be qualified for this matter. Cause: The Town was not aware of the monitoring requirements. Recommendation: We recommend the Town identify all federal money and comply with all federal compliance requirements.
Finding 2023-010
2022/2023-0010 Audit Report Deadline CFDA Title: Drinking Water State Revolving Fund CFDA Number: 66.468 Federal Award Number: Award #WRF-22515 and #WRF-22516 Federal Agency: United States Environmental Protection Agency Pass-through Entity: Montana Department of Natural Resources and Conservation Subrecipient: North Central Regional Water Authority Condition: Montana local governments with a June 30th fiscal year end must submit their audit report to the MT Department of Administration and the Federal Clearing house by March 31st, following the fiscal year end. The Town audit was not completed until June 2024. Context: Per review of the audit compliance requirements for both the State of Montana and the Federal government. Criteria: The audit for the fiscal year ended June 30th, 2022 and June 30, 2023, was due to the State and the Federal government by March 31, 2024 as required by MT Administrative Rules 2.4.411 and the Federal Uniform Guidance/A-133 rules. Effect: The Town is late in completing the biennial audit for fiscal year 2022 and 2023. Cause: The Town does not have processes in place to identify if a federal audit is needed. Recommendation: We recommend the District complete their annual audits in compliance with MT Administrative Rules 2.4.411 and federal rules described in the Uniform Guidance/A-133.
Finding 2023-009
2022/2023-009 Monitoring Subrecipients CFDA Title: Drinking Water State Revolving Fund CFDA Number: 66.468 Federal Award Number: Fiscal Year Ended June 30, 2023 Award #WRF-22515 and #WRF-22516 Federal Agency: United States Environmental Protection Agency Pass-through Entity: Montana Department of Natural Resources and Conservation Subrecipient: North Central Regional Water Authority Condition: The Town reimbursed North Central Regional Water Authority (NCRWA) $900,000 of federal sourced money for expenses related to a federal water project managed and owned by NCRWA. The assets acquired/built by NCRWA are the property of NCRWA. The $900,000 reimbursement is a sub-award of a federal grant from the City to NCRWA. The City did not monitor NCRWA to ensure the money was audited and spent in accordance with the federal requirements. Context: During the federal portion of the audit, we discovered the Town received two federal sourced loans totaling $900,000. We further discovered the money was transferred to another Montana local government to build a water project. Inquiry with the city disclosed no formal monitoring procedures. Criteria: The Town did not monitor the subrecipient (NCRWA) as required by 2CFR 200-part f. Additionally, the Town did not notify NCRWA of the federal requirements for the grant. Effect: The Town was not in compliance with the monitoring requirements of the federal grant. Additionally, NCRWA was not aware of the federal requirements. As a result, their audit did not include this federal grant as part of their annual audit. The federal audit opinion will be qualified for this matter. Cause: The Town was not aware of the monitoring requirements. Recommendation: We recommend the Town identify all federal money and comply with all federal compliance requirements.
Finding 2023-010
2022/2023-0010 Audit Report Deadline CFDA Title: Drinking Water State Revolving Fund CFDA Number: 66.468 Federal Award Number: Award #WRF-22515 and #WRF-22516 Federal Agency: United States Environmental Protection Agency Pass-through Entity: Montana Department of Natural Resources and Conservation Subrecipient: North Central Regional Water Authority Condition: Montana local governments with a June 30th fiscal year end must submit their audit report to the MT Department of Administration and the Federal Clearing house by March 31st, following the fiscal year end. The Town audit was not completed until June 2024. Context: Per review of the audit compliance requirements for both the State of Montana and the Federal government. Criteria: The audit for the fiscal year ended June 30th, 2022 and June 30, 2023, was due to the State and the Federal government by March 31, 2024 as required by MT Administrative Rules 2.4.411 and the Federal Uniform Guidance/A-133 rules. Effect: The Town is late in completing the biennial audit for fiscal year 2022 and 2023. Cause: The Town does not have processes in place to identify if a federal audit is needed. Recommendation: We recommend the District complete their annual audits in compliance with MT Administrative Rules 2.4.411 and federal rules described in the Uniform Guidance/A-133.
Finding 2023-009
2022/2023-009 Monitoring Subrecipients CFDA Title: Drinking Water State Revolving Fund CFDA Number: 66.468 Federal Award Number: Fiscal Year Ended June 30, 2023 Award #WRF-22515 and #WRF-22516 Federal Agency: United States Environmental Protection Agency Pass-through Entity: Montana Department of Natural Resources and Conservation Subrecipient: North Central Regional Water Authority Condition: The Town reimbursed North Central Regional Water Authority (NCRWA) $900,000 of federal sourced money for expenses related to a federal water project managed and owned by NCRWA. The assets acquired/built by NCRWA are the property of NCRWA. The $900,000 reimbursement is a sub-award of a federal grant from the City to NCRWA. The City did not monitor NCRWA to ensure the money was audited and spent in accordance with the federal requirements. Context: During the federal portion of the audit, we discovered the Town received two federal sourced loans totaling $900,000. We further discovered the money was transferred to another Montana local government to build a water project. Inquiry with the city disclosed no formal monitoring procedures. Criteria: The Town did not monitor the subrecipient (NCRWA) as required by 2CFR 200-part f. Additionally, the Town did not notify NCRWA of the federal requirements for the grant. Effect: The Town was not in compliance with the monitoring requirements of the federal grant. Additionally, NCRWA was not aware of the federal requirements. As a result, their audit did not include this federal grant as part of their annual audit. The federal audit opinion will be qualified for this matter. Cause: The Town was not aware of the monitoring requirements. Recommendation: We recommend the Town identify all federal money and comply with all federal compliance requirements.
Finding 2023-010
2022/2023-0010 Audit Report Deadline CFDA Title: Drinking Water State Revolving Fund CFDA Number: 66.468 Federal Award Number: Award #WRF-22515 and #WRF-22516 Federal Agency: United States Environmental Protection Agency Pass-through Entity: Montana Department of Natural Resources and Conservation Subrecipient: North Central Regional Water Authority Condition: Montana local governments with a June 30th fiscal year end must submit their audit report to the MT Department of Administration and the Federal Clearing house by March 31st, following the fiscal year end. The Town audit was not completed until June 2024. Context: Per review of the audit compliance requirements for both the State of Montana and the Federal government. Criteria: The audit for the fiscal year ended June 30th, 2022 and June 30, 2023, was due to the State and the Federal government by March 31, 2024 as required by MT Administrative Rules 2.4.411 and the Federal Uniform Guidance/A-133 rules. Effect: The Town is late in completing the biennial audit for fiscal year 2022 and 2023. Cause: The Town does not have processes in place to identify if a federal audit is needed. Recommendation: We recommend the District complete their annual audits in compliance with MT Administrative Rules 2.4.411 and federal rules described in the Uniform Guidance/A-133.
Finding 2023-009
2022/2023-009 Monitoring Subrecipients CFDA Title: Drinking Water State Revolving Fund CFDA Number: 66.468 Federal Award Number: Fiscal Year Ended June 30, 2023 Award #WRF-22515 and #WRF-22516 Federal Agency: United States Environmental Protection Agency Pass-through Entity: Montana Department of Natural Resources and Conservation Subrecipient: North Central Regional Water Authority Condition: The Town reimbursed North Central Regional Water Authority (NCRWA) $900,000 of federal sourced money for expenses related to a federal water project managed and owned by NCRWA. The assets acquired/built by NCRWA are the property of NCRWA. The $900,000 reimbursement is a sub-award of a federal grant from the City to NCRWA. The City did not monitor NCRWA to ensure the money was audited and spent in accordance with the federal requirements. Context: During the federal portion of the audit, we discovered the Town received two federal sourced loans totaling $900,000. We further discovered the money was transferred to another Montana local government to build a water project. Inquiry with the city disclosed no formal monitoring procedures. Criteria: The Town did not monitor the subrecipient (NCRWA) as required by 2CFR 200-part f. Additionally, the Town did not notify NCRWA of the federal requirements for the grant. Effect: The Town was not in compliance with the monitoring requirements of the federal grant. Additionally, NCRWA was not aware of the federal requirements. As a result, their audit did not include this federal grant as part of their annual audit. The federal audit opinion will be qualified for this matter. Cause: The Town was not aware of the monitoring requirements. Recommendation: We recommend the Town identify all federal money and comply with all federal compliance requirements.
Finding 2023-010
2022/2023-0010 Audit Report Deadline CFDA Title: Drinking Water State Revolving Fund CFDA Number: 66.468 Federal Award Number: Award #WRF-22515 and #WRF-22516 Federal Agency: United States Environmental Protection Agency Pass-through Entity: Montana Department of Natural Resources and Conservation Subrecipient: North Central Regional Water Authority Condition: Montana local governments with a June 30th fiscal year end must submit their audit report to the MT Department of Administration and the Federal Clearing house by March 31st, following the fiscal year end. The Town audit was not completed until June 2024. Context: Per review of the audit compliance requirements for both the State of Montana and the Federal government. Criteria: The audit for the fiscal year ended June 30th, 2022 and June 30, 2023, was due to the State and the Federal government by March 31, 2024 as required by MT Administrative Rules 2.4.411 and the Federal Uniform Guidance/A-133 rules. Effect: The Town is late in completing the biennial audit for fiscal year 2022 and 2023. Cause: The Town does not have processes in place to identify if a federal audit is needed. Recommendation: We recommend the District complete their annual audits in compliance with MT Administrative Rules 2.4.411 and federal rules described in the Uniform Guidance/A-133.