FAC Explorer

Audit 315084

FY End
2023-12-31
Total Expended
$2.85M
Findings
6
Programs
2
Organization: Charter Township of Oscoda (MI)
Year: 2023 Accepted: 2024-07-15
Auditor: Gabridge & CO Plc

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
478400 2023-002 Material Weakness - ABH
478401 2023-002 Material Weakness - ABH
478402 2023-002 Material Weakness - ABH
1054842 2023-002 Material Weakness - ABH
1054843 2023-002 Material Weakness - ABH
1054844 2023-002 Material Weakness - ABH

Programs

ALN Program Spent Major Findings
21.027 Coronavirus State and Local Fiscal Recovery Funds $2.53M Yes 1
66.458 Capitalization Grants for Clean Water State Revolving Funds $308,455 - 1

Contacts

Name Title Type
PHJNHJRDNBX3 Joshua Sutton Auditee
9897393211 Joe Verlin Auditor
No contacts on file

Notes to SEFA

Title: NOTE 1 - BASIS OF PRESENTATION Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting, which is described in Note 1 to the Township's financial statements. 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. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: For purposes of charging indirect costs to federal awards, the Township has not elected to use the 10 percent de minimis cost rate as permitted by §200.414 of the Uniform Guidance. The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal grant activity of the Charter Township of Oscoda (the “Township”) under programs of the federal government for the year ended December 31, 2023. 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 Township, it is not intended to and does not present the financial position, changes in net position or cash flows of the Township. The Township’s reporting entity is defined in Note 1 of the Township’s Audited Financial Statements.
Title: NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting, which is described in Note 1 to the Township's financial statements. 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. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: For purposes of charging indirect costs to federal awards, the Township has not elected to use the 10 percent de minimis cost rate as permitted by §200.414 of the Uniform Guidance. Expenditures reported on the Schedule are reported on the accrual basis of accounting, which is described in Note 1 to the Township's financial statements. 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. Pass-through entity identifying numbers are presented where available. For purposes of charging indirect costs to federal awards, the Township has not elected to use the 10 percent de minimis cost rate as permitted by §200.414 of the Uniform Guidance.
Title: NOTE 3 - RECONCILIATION TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting, which is described in Note 1 to the Township's financial statements. 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. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: For purposes of charging indirect costs to federal awards, the Township has not elected to use the 10 percent de minimis cost rate as permitted by §200.414 of the Uniform Guidance. The following reconciles the federal activity from the basic financial statements with the federal expenditures in the Schedule: See page 75 of the pdf or page 72 of the audit report for table.

Finding Details

Finding 2023-002
2023-002 - Deficiency in Internal Controls Over SEFA Preparation and Material Adjustments Finding Type: Material Weakness in Internal Control Over Compliance Programs: Coronavirus State and Local Fiscal Recovery Funds (Assistance Listing Number 21.027) and Capitalization Grants for Clean Water State Revolving Funds (Assistance Listing Number 66.458) Criteria: According to 2 CFR § 200.508(b), the auditee is responsible for preparing appropriate financial statements, including the Schedule of Expenditures of Federal Awards (SEFA). The Uniform Guidance requires that auditees maintain adequate internal controls over financial reporting to ensure that financial statements and the SEFA are accurate, complete, and prepared in accordance with applicable regulations. Condition/Finding: During the course of our federal single audit, it was observed that the Schedule of Expenditures of Federal Awards (“SEFA”) was prepared by the auditor instead of the Township. Although the Township reviewed and accepted the SEFA, the preparation was not independently performed by the Township. Additionally, the auditor proposed and the Township accepted material proposed audit adjusting journal entries that impacted the federal awards reported on the SEFA. Cause: The Township lacks sufficient staff with the necessary skills and knowledge to independently prepare the SEFA. As a result, the Township relies on the auditor to compile this schedule and to propose material audit adjustments. The Township has limited resources, which contributes to this reliance. Effect: Reliance on the auditor to prepare the SEFA and to propose material audit adjustments indicates a deficiency in the Township’s internal controls over financial reporting. This situation increases the risk that the SEFA may not be accurately or completely prepared if the auditor does not perform these tasks. Additionally, this reliance could potentially result in a significant deficiency or material weakness in the Township’s internal control over financial reporting. Questioned Costs: No costs have been questioned as a result of this finding. Repeat Finding: No Recommendation: To correct this finding in the future, we recommend that the Township take the following actions: 1. Staff Training: Provide additional training to current staff on the requirements and preparation of the SEFA to build the necessary skills and knowledge internally. 2. Develop Detailed Procedures: Develop and document detailed procedures and guidelines for preparing the SEFA, including checklists and timelines, to assist staff in the accurate preparation of this schedule. 3. Review and Approval Process: Establish a robust review and approval process where a knowledgeable individual within the organization reviews the SEFA for accuracy and completeness before submission. 4. Improve Internal Controls: Enhance internal controls over financial reporting to ensure that material audit adjustments are minimized and that the financial statements and SEFA are prepared accurately and independently. View of Responsible Officials (Corrective Action): See corrective action plan.
Finding 2023-002
2023-002 - Deficiency in Internal Controls Over SEFA Preparation and Material Adjustments Finding Type: Material Weakness in Internal Control Over Compliance Programs: Coronavirus State and Local Fiscal Recovery Funds (Assistance Listing Number 21.027) and Capitalization Grants for Clean Water State Revolving Funds (Assistance Listing Number 66.458) Criteria: According to 2 CFR § 200.508(b), the auditee is responsible for preparing appropriate financial statements, including the Schedule of Expenditures of Federal Awards (SEFA). The Uniform Guidance requires that auditees maintain adequate internal controls over financial reporting to ensure that financial statements and the SEFA are accurate, complete, and prepared in accordance with applicable regulations. Condition/Finding: During the course of our federal single audit, it was observed that the Schedule of Expenditures of Federal Awards (“SEFA”) was prepared by the auditor instead of the Township. Although the Township reviewed and accepted the SEFA, the preparation was not independently performed by the Township. Additionally, the auditor proposed and the Township accepted material proposed audit adjusting journal entries that impacted the federal awards reported on the SEFA. Cause: The Township lacks sufficient staff with the necessary skills and knowledge to independently prepare the SEFA. As a result, the Township relies on the auditor to compile this schedule and to propose material audit adjustments. The Township has limited resources, which contributes to this reliance. Effect: Reliance on the auditor to prepare the SEFA and to propose material audit adjustments indicates a deficiency in the Township’s internal controls over financial reporting. This situation increases the risk that the SEFA may not be accurately or completely prepared if the auditor does not perform these tasks. Additionally, this reliance could potentially result in a significant deficiency or material weakness in the Township’s internal control over financial reporting. Questioned Costs: No costs have been questioned as a result of this finding. Repeat Finding: No Recommendation: To correct this finding in the future, we recommend that the Township take the following actions: 1. Staff Training: Provide additional training to current staff on the requirements and preparation of the SEFA to build the necessary skills and knowledge internally. 2. Develop Detailed Procedures: Develop and document detailed procedures and guidelines for preparing the SEFA, including checklists and timelines, to assist staff in the accurate preparation of this schedule. 3. Review and Approval Process: Establish a robust review and approval process where a knowledgeable individual within the organization reviews the SEFA for accuracy and completeness before submission. 4. Improve Internal Controls: Enhance internal controls over financial reporting to ensure that material audit adjustments are minimized and that the financial statements and SEFA are prepared accurately and independently. View of Responsible Officials (Corrective Action): See corrective action plan.
Finding 2023-002
2023-002 - Deficiency in Internal Controls Over SEFA Preparation and Material Adjustments Finding Type: Material Weakness in Internal Control Over Compliance Programs: Coronavirus State and Local Fiscal Recovery Funds (Assistance Listing Number 21.027) and Capitalization Grants for Clean Water State Revolving Funds (Assistance Listing Number 66.458) Criteria: According to 2 CFR § 200.508(b), the auditee is responsible for preparing appropriate financial statements, including the Schedule of Expenditures of Federal Awards (SEFA). The Uniform Guidance requires that auditees maintain adequate internal controls over financial reporting to ensure that financial statements and the SEFA are accurate, complete, and prepared in accordance with applicable regulations. Condition/Finding: During the course of our federal single audit, it was observed that the Schedule of Expenditures of Federal Awards (“SEFA”) was prepared by the auditor instead of the Township. Although the Township reviewed and accepted the SEFA, the preparation was not independently performed by the Township. Additionally, the auditor proposed and the Township accepted material proposed audit adjusting journal entries that impacted the federal awards reported on the SEFA. Cause: The Township lacks sufficient staff with the necessary skills and knowledge to independently prepare the SEFA. As a result, the Township relies on the auditor to compile this schedule and to propose material audit adjustments. The Township has limited resources, which contributes to this reliance. Effect: Reliance on the auditor to prepare the SEFA and to propose material audit adjustments indicates a deficiency in the Township’s internal controls over financial reporting. This situation increases the risk that the SEFA may not be accurately or completely prepared if the auditor does not perform these tasks. Additionally, this reliance could potentially result in a significant deficiency or material weakness in the Township’s internal control over financial reporting. Questioned Costs: No costs have been questioned as a result of this finding. Repeat Finding: No Recommendation: To correct this finding in the future, we recommend that the Township take the following actions: 1. Staff Training: Provide additional training to current staff on the requirements and preparation of the SEFA to build the necessary skills and knowledge internally. 2. Develop Detailed Procedures: Develop and document detailed procedures and guidelines for preparing the SEFA, including checklists and timelines, to assist staff in the accurate preparation of this schedule. 3. Review and Approval Process: Establish a robust review and approval process where a knowledgeable individual within the organization reviews the SEFA for accuracy and completeness before submission. 4. Improve Internal Controls: Enhance internal controls over financial reporting to ensure that material audit adjustments are minimized and that the financial statements and SEFA are prepared accurately and independently. View of Responsible Officials (Corrective Action): See corrective action plan.
Finding 2023-002
2023-002 - Deficiency in Internal Controls Over SEFA Preparation and Material Adjustments Finding Type: Material Weakness in Internal Control Over Compliance Programs: Coronavirus State and Local Fiscal Recovery Funds (Assistance Listing Number 21.027) and Capitalization Grants for Clean Water State Revolving Funds (Assistance Listing Number 66.458) Criteria: According to 2 CFR § 200.508(b), the auditee is responsible for preparing appropriate financial statements, including the Schedule of Expenditures of Federal Awards (SEFA). The Uniform Guidance requires that auditees maintain adequate internal controls over financial reporting to ensure that financial statements and the SEFA are accurate, complete, and prepared in accordance with applicable regulations. Condition/Finding: During the course of our federal single audit, it was observed that the Schedule of Expenditures of Federal Awards (“SEFA”) was prepared by the auditor instead of the Township. Although the Township reviewed and accepted the SEFA, the preparation was not independently performed by the Township. Additionally, the auditor proposed and the Township accepted material proposed audit adjusting journal entries that impacted the federal awards reported on the SEFA. Cause: The Township lacks sufficient staff with the necessary skills and knowledge to independently prepare the SEFA. As a result, the Township relies on the auditor to compile this schedule and to propose material audit adjustments. The Township has limited resources, which contributes to this reliance. Effect: Reliance on the auditor to prepare the SEFA and to propose material audit adjustments indicates a deficiency in the Township’s internal controls over financial reporting. This situation increases the risk that the SEFA may not be accurately or completely prepared if the auditor does not perform these tasks. Additionally, this reliance could potentially result in a significant deficiency or material weakness in the Township’s internal control over financial reporting. Questioned Costs: No costs have been questioned as a result of this finding. Repeat Finding: No Recommendation: To correct this finding in the future, we recommend that the Township take the following actions: 1. Staff Training: Provide additional training to current staff on the requirements and preparation of the SEFA to build the necessary skills and knowledge internally. 2. Develop Detailed Procedures: Develop and document detailed procedures and guidelines for preparing the SEFA, including checklists and timelines, to assist staff in the accurate preparation of this schedule. 3. Review and Approval Process: Establish a robust review and approval process where a knowledgeable individual within the organization reviews the SEFA for accuracy and completeness before submission. 4. Improve Internal Controls: Enhance internal controls over financial reporting to ensure that material audit adjustments are minimized and that the financial statements and SEFA are prepared accurately and independently. View of Responsible Officials (Corrective Action): See corrective action plan.
Finding 2023-002
2023-002 - Deficiency in Internal Controls Over SEFA Preparation and Material Adjustments Finding Type: Material Weakness in Internal Control Over Compliance Programs: Coronavirus State and Local Fiscal Recovery Funds (Assistance Listing Number 21.027) and Capitalization Grants for Clean Water State Revolving Funds (Assistance Listing Number 66.458) Criteria: According to 2 CFR § 200.508(b), the auditee is responsible for preparing appropriate financial statements, including the Schedule of Expenditures of Federal Awards (SEFA). The Uniform Guidance requires that auditees maintain adequate internal controls over financial reporting to ensure that financial statements and the SEFA are accurate, complete, and prepared in accordance with applicable regulations. Condition/Finding: During the course of our federal single audit, it was observed that the Schedule of Expenditures of Federal Awards (“SEFA”) was prepared by the auditor instead of the Township. Although the Township reviewed and accepted the SEFA, the preparation was not independently performed by the Township. Additionally, the auditor proposed and the Township accepted material proposed audit adjusting journal entries that impacted the federal awards reported on the SEFA. Cause: The Township lacks sufficient staff with the necessary skills and knowledge to independently prepare the SEFA. As a result, the Township relies on the auditor to compile this schedule and to propose material audit adjustments. The Township has limited resources, which contributes to this reliance. Effect: Reliance on the auditor to prepare the SEFA and to propose material audit adjustments indicates a deficiency in the Township’s internal controls over financial reporting. This situation increases the risk that the SEFA may not be accurately or completely prepared if the auditor does not perform these tasks. Additionally, this reliance could potentially result in a significant deficiency or material weakness in the Township’s internal control over financial reporting. Questioned Costs: No costs have been questioned as a result of this finding. Repeat Finding: No Recommendation: To correct this finding in the future, we recommend that the Township take the following actions: 1. Staff Training: Provide additional training to current staff on the requirements and preparation of the SEFA to build the necessary skills and knowledge internally. 2. Develop Detailed Procedures: Develop and document detailed procedures and guidelines for preparing the SEFA, including checklists and timelines, to assist staff in the accurate preparation of this schedule. 3. Review and Approval Process: Establish a robust review and approval process where a knowledgeable individual within the organization reviews the SEFA for accuracy and completeness before submission. 4. Improve Internal Controls: Enhance internal controls over financial reporting to ensure that material audit adjustments are minimized and that the financial statements and SEFA are prepared accurately and independently. View of Responsible Officials (Corrective Action): See corrective action plan.
Finding 2023-002
2023-002 - Deficiency in Internal Controls Over SEFA Preparation and Material Adjustments Finding Type: Material Weakness in Internal Control Over Compliance Programs: Coronavirus State and Local Fiscal Recovery Funds (Assistance Listing Number 21.027) and Capitalization Grants for Clean Water State Revolving Funds (Assistance Listing Number 66.458) Criteria: According to 2 CFR § 200.508(b), the auditee is responsible for preparing appropriate financial statements, including the Schedule of Expenditures of Federal Awards (SEFA). The Uniform Guidance requires that auditees maintain adequate internal controls over financial reporting to ensure that financial statements and the SEFA are accurate, complete, and prepared in accordance with applicable regulations. Condition/Finding: During the course of our federal single audit, it was observed that the Schedule of Expenditures of Federal Awards (“SEFA”) was prepared by the auditor instead of the Township. Although the Township reviewed and accepted the SEFA, the preparation was not independently performed by the Township. Additionally, the auditor proposed and the Township accepted material proposed audit adjusting journal entries that impacted the federal awards reported on the SEFA. Cause: The Township lacks sufficient staff with the necessary skills and knowledge to independently prepare the SEFA. As a result, the Township relies on the auditor to compile this schedule and to propose material audit adjustments. The Township has limited resources, which contributes to this reliance. Effect: Reliance on the auditor to prepare the SEFA and to propose material audit adjustments indicates a deficiency in the Township’s internal controls over financial reporting. This situation increases the risk that the SEFA may not be accurately or completely prepared if the auditor does not perform these tasks. Additionally, this reliance could potentially result in a significant deficiency or material weakness in the Township’s internal control over financial reporting. Questioned Costs: No costs have been questioned as a result of this finding. Repeat Finding: No Recommendation: To correct this finding in the future, we recommend that the Township take the following actions: 1. Staff Training: Provide additional training to current staff on the requirements and preparation of the SEFA to build the necessary skills and knowledge internally. 2. Develop Detailed Procedures: Develop and document detailed procedures and guidelines for preparing the SEFA, including checklists and timelines, to assist staff in the accurate preparation of this schedule. 3. Review and Approval Process: Establish a robust review and approval process where a knowledgeable individual within the organization reviews the SEFA for accuracy and completeness before submission. 4. Improve Internal Controls: Enhance internal controls over financial reporting to ensure that material audit adjustments are minimized and that the financial statements and SEFA are prepared accurately and independently. View of Responsible Officials (Corrective Action): See corrective action plan.