Audit 316379

FY End
2023-12-31
Total Expended
$796,085
Findings
4
Programs
1
Organization: Warren County Water District (KY)
Year: 2023 Accepted: 2024-07-31

Organization Exclusion Status:

Checking exclusion status...

Findings

ID Ref Severity Repeat Requirement
480088 2023-001 Material Weakness - I
480089 2023-002 Significant Deficiency - H
1056530 2023-001 Material Weakness - I
1056531 2023-002 Significant Deficiency - H

Programs

ALN Program Spent Major Findings
21.027 Covid-19 Coronavirus State and Local Fiscal Recovery Funds $796,085 Yes 2

Contacts

Name Title Type
CTF5PNAE7MX4 Jeff Peeples Auditee
2708420052 Shelly Compton Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: The District has elected to not use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance The accompanying schedule of expenditures of federal awards (the "schedule") includes the federal grant activity of Warren County Water District (the "District") 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 (CFR) 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 District, it is not intended to and does not present the financial position, changes in net position or cash flows of the District.
Title: Loans and Loan Guarantees Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: The District has elected to not use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance The District did not have any loans or loan guarantee programs required to be reported on the schedule.
Title: Contingencies Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: The District has elected to not use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance Grant monies received and disbursed by the District are for specific purposes and are subject to review by grantor agencies. Such audits may result in requests for reimubursement due to disallowed expenditures. Based upon experience, the District does not believe that such disallowance, if any, would have a material effect on the financial position of the District.
Title: Subrecipients Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: The District has elected to not use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance The District did not provide federal funds to subrecipients for the fiscal year ended December 31, 2023.
Title: Noncash Assistance Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: The District has elected to not use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance The District did not receive any federal noncash assistance for the fiscal year ended December 31, 2023.
Title: Federal Expenses Incurred From A Prior Year Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: The District has elected to not use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance The District incurred $68,237 of federal expenses in the prior years that is reported on the schedule for the year ending December 31, 2023. These expenses were incurred prior to the District being approved for reimbursement by the County of Warren, Kentucky.

Finding Details

Department of Treasury Pass-through County of Warren, Kentucky; Coronavirus State and Local Fiscal Recovery Funds (LSFRF) - Assistance Listing No. 21.027; Grant period - Year ended December 31, 2023 Criteria and Condition: 2 CFR 200.303 requires the non-federal entity to establish and maintain effective internal controls over compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Non-federal entities are prohibited from contract with our making subawards under covered transactions to parties that are suspended or debarred. When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. The District's processes over procurement, suspension, and debarment could be enhanced as costs were charged to the Coronavirus State and Local Fiscal Recovery Funds grant that were paid to vendors that had not been checked for suspension or debarment. Cause: Certain internal controls were not in place to properly detect if vendors had been suspended or debarred. Effect: The cost of the assistance may be disallowed. Questioned Costs: N/A Context: Two vendors were tested that were awared contracts for goods or services and charged to the Coronavirus State and Local Fiscal Recovery Funds grant. The test found the vendors had not been checked for suspension or debarment. Recommendation: The District should enhance the review of vendors for suspension or debarment. Views of Responsible Officials and Planned Correct Actions: The District concurs with the finding, see corrective action plan
Department of Treasury Pass-through County of Warren, Kentucky; Coronavirus State and Local Fiscal Recovery Funds (LSFRF) - Assistance Listing No. 21.027; Grant period - Year ended December 31, 2023 Criteria and Condition: 2 CFR 200.303 requires the non-federal entity to establish and maintaineffective internal controsl over compliance with Federal staues, regulations, and the terms and conditions of the Federal award including proper tracking of grant expenditures for compliance. 31 CFR Part 35.5(a) defines the period of performance for the Coronavirus State and Local Fiscal Recovery Funds grant as beginning on March 3, 2021. The District's processes over approving allwoable costs in the proper period of performance could be enhanced as costs were charged to the Coronavirus State and Local Fiscal Recovery Funds grant that fell outside of the proper period of performance. Cause: Certain internal controls were not in place to prevent costs from outside of the proper period of performance from being charged to the grant. Effect: The cost of the assistance may be disallowed. Questioned Costs: $3,670 Context: Transactions prior to March 3, 2021 were identified in test work. The full amount of these costs charged to the program was determined to be $3,670. Recommendation: The District should enhance the review of costs prior to being transferred or charged to the grant to ensure it includes a review for proper period of performance. Viewes of Responsible Officials and Planned Corrective Actions: The District concurs with the finding, see corrective action plan
Department of Treasury Pass-through County of Warren, Kentucky; Coronavirus State and Local Fiscal Recovery Funds (LSFRF) - Assistance Listing No. 21.027; Grant period - Year ended December 31, 2023 Criteria and Condition: 2 CFR 200.303 requires the non-federal entity to establish and maintain effective internal controls over compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Non-federal entities are prohibited from contract with our making subawards under covered transactions to parties that are suspended or debarred. When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. The District's processes over procurement, suspension, and debarment could be enhanced as costs were charged to the Coronavirus State and Local Fiscal Recovery Funds grant that were paid to vendors that had not been checked for suspension or debarment. Cause: Certain internal controls were not in place to properly detect if vendors had been suspended or debarred. Effect: The cost of the assistance may be disallowed. Questioned Costs: N/A Context: Two vendors were tested that were awared contracts for goods or services and charged to the Coronavirus State and Local Fiscal Recovery Funds grant. The test found the vendors had not been checked for suspension or debarment. Recommendation: The District should enhance the review of vendors for suspension or debarment. Views of Responsible Officials and Planned Correct Actions: The District concurs with the finding, see corrective action plan
Department of Treasury Pass-through County of Warren, Kentucky; Coronavirus State and Local Fiscal Recovery Funds (LSFRF) - Assistance Listing No. 21.027; Grant period - Year ended December 31, 2023 Criteria and Condition: 2 CFR 200.303 requires the non-federal entity to establish and maintaineffective internal controsl over compliance with Federal staues, regulations, and the terms and conditions of the Federal award including proper tracking of grant expenditures for compliance. 31 CFR Part 35.5(a) defines the period of performance for the Coronavirus State and Local Fiscal Recovery Funds grant as beginning on March 3, 2021. The District's processes over approving allwoable costs in the proper period of performance could be enhanced as costs were charged to the Coronavirus State and Local Fiscal Recovery Funds grant that fell outside of the proper period of performance. Cause: Certain internal controls were not in place to prevent costs from outside of the proper period of performance from being charged to the grant. Effect: The cost of the assistance may be disallowed. Questioned Costs: $3,670 Context: Transactions prior to March 3, 2021 were identified in test work. The full amount of these costs charged to the program was determined to be $3,670. Recommendation: The District should enhance the review of costs prior to being transferred or charged to the grant to ensure it includes a review for proper period of performance. Viewes of Responsible Officials and Planned Corrective Actions: The District concurs with the finding, see corrective action plan