FAC Explorer

Audit 316749

FY End
2023-06-30
Total Expended
$922,606
Findings
4
Programs
2
Organization: Stilwell Area Devlopment Authority (OK)
Year: 2023 Accepted: 2024-08-06
Auditor: Michael W Green CPA

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
480549 2023-002 Material Weakness - B
480550 2023-002 Material Weakness - B
1056991 2023-002 Material Weakness - B
1056992 2023-002 Material Weakness - B

Programs

ALN Program Spent Major Findings
11.307 Economic Adjustment Assistance $68,256 - 0
21.027 Coronavirus State and Local Fiscal Recovery Funds $30,000 Yes 1

Contacts

Name Title Type
S8Y7ENLGAV86 Robert St Pierre Auditee
9186968105 Michael W. Green Auditor
No contacts on file

Notes to SEFA

Title: NOTE A-BASIS OF PRESENTATION Accounting Policies: EXPENDITURES REPORTED ON THE SEFA ARE REPORTED ON THE 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. THE AUTHORITY HAS ELECTED NOT TO USE THE 10-PERCENT DE MINIMIS INDIRECT COST RATE AS ALLOWED UNDER THE UNIFORM GUIDANCE. De Minimis Rate Used: N Rate Explanation: THE AUTHORITY HAS ELECTED NOT TO USE THE 10-PERCENT DE MINIMIS INDIRECT COST RATE AS ALLOWED UNDER THE UNIFORM GUIDANCE. THE ACCOMPANYING SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS (SEFA) INCLUDES THE FEDERAL AWARD ACTIVITY OF THE AUTHORITY UNDER PROGRAMS OF THE FEDERAL GOVERNMENT FOR THE YEAR ENDED JUNE 30, 2023. THE INFORMATION IN THIS SEFA 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 SEFA PRESENTS ONLY A SELECTED PORTION OF THE OPERATIONS OF THE AUTHORITY, IT IS NOT INTENDED TO AND DOES NOT PRESENT THE FINANCIAL POSITION, CHANGES IN NET ASSETS, OR CASH FLOWS OF THE AUTHORITY.
Title: NOTE B-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Policies: EXPENDITURES REPORTED ON THE SEFA ARE REPORTED ON THE 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. THE AUTHORITY HAS ELECTED NOT TO USE THE 10-PERCENT DE MINIMIS INDIRECT COST RATE AS ALLOWED UNDER THE UNIFORM GUIDANCE. De Minimis Rate Used: N Rate Explanation: THE AUTHORITY HAS ELECTED NOT TO USE THE 10-PERCENT DE MINIMIS INDIRECT COST RATE AS ALLOWED UNDER THE UNIFORM GUIDANCE. EXPENDITURES REPORTED ON THE SEFA ARE REPORTED ON THE 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. THE AUTHORITY HAS ELECTED NOT TO USE THE 10-PERCENT DE MINIMIS INDIRECT COST RATE AS ALLOWED UNDER THE UNIFORM GUIDANCE.
Title: NOTE C-LOANS AND LOAN GUARANTEES Accounting Policies: EXPENDITURES REPORTED ON THE SEFA ARE REPORTED ON THE 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. THE AUTHORITY HAS ELECTED NOT TO USE THE 10-PERCENT DE MINIMIS INDIRECT COST RATE AS ALLOWED UNDER THE UNIFORM GUIDANCE. De Minimis Rate Used: N Rate Explanation: THE AUTHORITY HAS ELECTED NOT TO USE THE 10-PERCENT DE MINIMIS INDIRECT COST RATE AS ALLOWED UNDER THE UNIFORM GUIDANCE. THE AUTHORITY WAS AWARDED AN UNITED STATES DEPARTMENT OF AGRICULTURE, WATER AND WASTE DISPOSAL LOAN IN THE AMOUNT OF $1,484,000 AT 1.375 PERCENT INTEREST PAYABLE OVER 40 YEARS. THIS LOAN WAS FUNDED IN FISCAL YEAR 2022 AND WAS USED TO PAY OFF THE EXISTING CONSTRUCTION LOAN. THERE IS NO CONTINUING AUDIT REQUIREMENT FOR THIS LOAN SINCE IT HAS ENTERED INTO THE REPAYMENT/DEBT SERVICE STAGE, CONSEQUENTLY, NO AMOUNT IS PRESENTED ON THE SEFA FOR THIS LOAN.

Finding Details

Finding 2023-002
MONTH END CLOSING-ALN 21.027-FEDERAL PROGRAM-CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS- FEDERAL AGENCY: DEPARTMENT OF THE TREASURY-CRITERIA: CHAPTER 2, PART 200, § 200,303, "ESTABLISH AND MAINTAIN EFFECTIVE INTERNAL CONTROL OVER THE FEDERAL AWARD THAT PROVIDES REASONABLE ASSURANCE THAT THE NON-FEDERAL ENTITY IS MANAGING THE FEDERAL AWARD IN COMPLIANCE WITH FEDERAL STATUTES, REGULATIONS, AND THE TERMS AND CONDITIONS OF THE FEDERAL AWARD". ONE COMPONENT OF AN EFFECTIVE INTERNAL CONTROL SYSTEM IS PROPER SUPERVISORY REVIEW AND USE OF CONTROL PROCEDURES TO ENSURE ADEUATE DETAIL OF MONTH END FINANCIAL CLOSE ENSURING ASSETS AND LIABILITIES ARE MAINTAINED AND RECORDED. CONDITION: RECONCILIATIONS OF ACCOUNTS RECEIVABLE, INVENTORY AND CUSTOMER DEPOSITS IN PREPARATION FOR YEAR-END FINANCIAL STATEMENTS REVEALED UNRECONCILED DIFFERENCES BETWEEN THE GENERAL LEDGER AND THE ACCOUNT DETAIL REPORTS. CAUSE AND EFFECT: INADEQUATE CONTROL OVER THE SOFTWARE AND RECONCILIATION TO THE GENERAL LEDGER CAUSED THE UNRECONCILED DIFFERENCES. THE DIFFERENCE IN INVENTORY WAS ADJUSTED BY MANAGEMENT. THE DIFFERENCES IN ACCOUNTS RECEIVABLE AND CUSTOMER DEPOSITS WERE NOT MATERIAL TO THE FINANCIAL STATEMENTS AND ADJUSTMENTS HAVE BEEN WAIVED. RECOMMENDATION: I RECOMMEND THE AUTHORITY REVIEW ITS POLICIES AND SOFTWARE UTILIZED TO ACCOUNT FOR THE BALANCE SHEET ITEMS. MONTHLY RECONCILIATION OF INVENTORY, ACCOUNTS RECEIVABLE AND CUSTOMER DEPOSIT DETAILS TO THE GENERAL LEDGER IS A KEY COMPONENT TO INTERNAL CONTROL. RESPONSIBLE OFFICIAL'S RESPONSE: MANAGEMENT WILL WORK WITH THE SOFTWARE COMPANY AND EMPLOYEES TO IMPLEMENT PROCEDURES TO ENSURE MONTHLY RECONCILIATIONS OF BALANCE SHEET ITEMS.
Finding 2023-002
MONTH END CLOSING-ALN 21.027-FEDERAL PROGRAM-CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS- FEDERAL AGENCY: DEPARTMENT OF THE TREASURY-CRITERIA: CHAPTER 2, PART 200, § 200,303, "ESTABLISH AND MAINTAIN EFFECTIVE INTERNAL CONTROL OVER THE FEDERAL AWARD THAT PROVIDES REASONABLE ASSURANCE THAT THE NON-FEDERAL ENTITY IS MANAGING THE FEDERAL AWARD IN COMPLIANCE WITH FEDERAL STATUTES, REGULATIONS, AND THE TERMS AND CONDITIONS OF THE FEDERAL AWARD". ONE COMPONENT OF AN EFFECTIVE INTERNAL CONTROL SYSTEM IS PROPER SUPERVISORY REVIEW AND USE OF CONTROL PROCEDURES TO ENSURE ADEUATE DETAIL OF MONTH END FINANCIAL CLOSE ENSURING ASSETS AND LIABILITIES ARE MAINTAINED AND RECORDED. CONDITION: RECONCILIATIONS OF ACCOUNTS RECEIVABLE, INVENTORY AND CUSTOMER DEPOSITS IN PREPARATION FOR YEAR-END FINANCIAL STATEMENTS REVEALED UNRECONCILED DIFFERENCES BETWEEN THE GENERAL LEDGER AND THE ACCOUNT DETAIL REPORTS. CAUSE AND EFFECT: INADEQUATE CONTROL OVER THE SOFTWARE AND RECONCILIATION TO THE GENERAL LEDGER CAUSED THE UNRECONCILED DIFFERENCES. THE DIFFERENCE IN INVENTORY WAS ADJUSTED BY MANAGEMENT. THE DIFFERENCES IN ACCOUNTS RECEIVABLE AND CUSTOMER DEPOSITS WERE NOT MATERIAL TO THE FINANCIAL STATEMENTS AND ADJUSTMENTS HAVE BEEN WAIVED. RECOMMENDATION: I RECOMMEND THE AUTHORITY REVIEW ITS POLICIES AND SOFTWARE UTILIZED TO ACCOUNT FOR THE BALANCE SHEET ITEMS. MONTHLY RECONCILIATION OF INVENTORY, ACCOUNTS RECEIVABLE AND CUSTOMER DEPOSIT DETAILS TO THE GENERAL LEDGER IS A KEY COMPONENT TO INTERNAL CONTROL. RESPONSIBLE OFFICIAL'S RESPONSE: MANAGEMENT WILL WORK WITH THE SOFTWARE COMPANY AND EMPLOYEES TO IMPLEMENT PROCEDURES TO ENSURE MONTHLY RECONCILIATIONS OF BALANCE SHEET ITEMS.
Finding 2023-002
MONTH END CLOSING-ALN 21.027-FEDERAL PROGRAM-CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS- FEDERAL AGENCY: DEPARTMENT OF THE TREASURY-CRITERIA: CHAPTER 2, PART 200, § 200,303, "ESTABLISH AND MAINTAIN EFFECTIVE INTERNAL CONTROL OVER THE FEDERAL AWARD THAT PROVIDES REASONABLE ASSURANCE THAT THE NON-FEDERAL ENTITY IS MANAGING THE FEDERAL AWARD IN COMPLIANCE WITH FEDERAL STATUTES, REGULATIONS, AND THE TERMS AND CONDITIONS OF THE FEDERAL AWARD". ONE COMPONENT OF AN EFFECTIVE INTERNAL CONTROL SYSTEM IS PROPER SUPERVISORY REVIEW AND USE OF CONTROL PROCEDURES TO ENSURE ADEUATE DETAIL OF MONTH END FINANCIAL CLOSE ENSURING ASSETS AND LIABILITIES ARE MAINTAINED AND RECORDED. CONDITION: RECONCILIATIONS OF ACCOUNTS RECEIVABLE, INVENTORY AND CUSTOMER DEPOSITS IN PREPARATION FOR YEAR-END FINANCIAL STATEMENTS REVEALED UNRECONCILED DIFFERENCES BETWEEN THE GENERAL LEDGER AND THE ACCOUNT DETAIL REPORTS. CAUSE AND EFFECT: INADEQUATE CONTROL OVER THE SOFTWARE AND RECONCILIATION TO THE GENERAL LEDGER CAUSED THE UNRECONCILED DIFFERENCES. THE DIFFERENCE IN INVENTORY WAS ADJUSTED BY MANAGEMENT. THE DIFFERENCES IN ACCOUNTS RECEIVABLE AND CUSTOMER DEPOSITS WERE NOT MATERIAL TO THE FINANCIAL STATEMENTS AND ADJUSTMENTS HAVE BEEN WAIVED. RECOMMENDATION: I RECOMMEND THE AUTHORITY REVIEW ITS POLICIES AND SOFTWARE UTILIZED TO ACCOUNT FOR THE BALANCE SHEET ITEMS. MONTHLY RECONCILIATION OF INVENTORY, ACCOUNTS RECEIVABLE AND CUSTOMER DEPOSIT DETAILS TO THE GENERAL LEDGER IS A KEY COMPONENT TO INTERNAL CONTROL. RESPONSIBLE OFFICIAL'S RESPONSE: MANAGEMENT WILL WORK WITH THE SOFTWARE COMPANY AND EMPLOYEES TO IMPLEMENT PROCEDURES TO ENSURE MONTHLY RECONCILIATIONS OF BALANCE SHEET ITEMS.
Finding 2023-002
MONTH END CLOSING-ALN 21.027-FEDERAL PROGRAM-CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS- FEDERAL AGENCY: DEPARTMENT OF THE TREASURY-CRITERIA: CHAPTER 2, PART 200, § 200,303, "ESTABLISH AND MAINTAIN EFFECTIVE INTERNAL CONTROL OVER THE FEDERAL AWARD THAT PROVIDES REASONABLE ASSURANCE THAT THE NON-FEDERAL ENTITY IS MANAGING THE FEDERAL AWARD IN COMPLIANCE WITH FEDERAL STATUTES, REGULATIONS, AND THE TERMS AND CONDITIONS OF THE FEDERAL AWARD". ONE COMPONENT OF AN EFFECTIVE INTERNAL CONTROL SYSTEM IS PROPER SUPERVISORY REVIEW AND USE OF CONTROL PROCEDURES TO ENSURE ADEUATE DETAIL OF MONTH END FINANCIAL CLOSE ENSURING ASSETS AND LIABILITIES ARE MAINTAINED AND RECORDED. CONDITION: RECONCILIATIONS OF ACCOUNTS RECEIVABLE, INVENTORY AND CUSTOMER DEPOSITS IN PREPARATION FOR YEAR-END FINANCIAL STATEMENTS REVEALED UNRECONCILED DIFFERENCES BETWEEN THE GENERAL LEDGER AND THE ACCOUNT DETAIL REPORTS. CAUSE AND EFFECT: INADEQUATE CONTROL OVER THE SOFTWARE AND RECONCILIATION TO THE GENERAL LEDGER CAUSED THE UNRECONCILED DIFFERENCES. THE DIFFERENCE IN INVENTORY WAS ADJUSTED BY MANAGEMENT. THE DIFFERENCES IN ACCOUNTS RECEIVABLE AND CUSTOMER DEPOSITS WERE NOT MATERIAL TO THE FINANCIAL STATEMENTS AND ADJUSTMENTS HAVE BEEN WAIVED. RECOMMENDATION: I RECOMMEND THE AUTHORITY REVIEW ITS POLICIES AND SOFTWARE UTILIZED TO ACCOUNT FOR THE BALANCE SHEET ITEMS. MONTHLY RECONCILIATION OF INVENTORY, ACCOUNTS RECEIVABLE AND CUSTOMER DEPOSIT DETAILS TO THE GENERAL LEDGER IS A KEY COMPONENT TO INTERNAL CONTROL. RESPONSIBLE OFFICIAL'S RESPONSE: MANAGEMENT WILL WORK WITH THE SOFTWARE COMPANY AND EMPLOYEES TO IMPLEMENT PROCEDURES TO ENSURE MONTHLY RECONCILIATIONS OF BALANCE SHEET ITEMS.