Audit 317890

FY End
2023-12-31
Total Expended
$440.20M
Findings
26
Programs
102
Organization: City and County of Denver (CO)
Year: 2023 Accepted: 2024-08-26
Auditor: Bdo USA PC

Organization Exclusion Status:

Checking exclusion status...

Findings

ID Ref Severity Repeat Requirement
485097 2023-002 Significant Deficiency Yes N
485098 2023-002 Significant Deficiency Yes N
485099 2023-003 Significant Deficiency Yes I
485100 2023-003 Significant Deficiency Yes I
485101 2023-004 Material Weakness Yes N
485102 2023-004 Material Weakness Yes N
485103 2023-005 Significant Deficiency Yes M
485104 2023-006 Significant Deficiency - N
485105 2023-006 Significant Deficiency - N
485106 2023-007 Significant Deficiency - AB
485107 2023-008 Significant Deficiency Yes L
485108 2023-009 Material Weakness - L
485109 2023-009 Material Weakness - L
1061539 2023-002 Significant Deficiency Yes N
1061540 2023-002 Significant Deficiency Yes N
1061541 2023-003 Significant Deficiency Yes I
1061542 2023-003 Significant Deficiency Yes I
1061543 2023-004 Material Weakness Yes N
1061544 2023-004 Material Weakness Yes N
1061545 2023-005 Significant Deficiency Yes M
1061546 2023-006 Significant Deficiency - N
1061547 2023-006 Significant Deficiency - N
1061548 2023-007 Significant Deficiency - AB
1061549 2023-008 Significant Deficiency Yes L
1061550 2023-009 Material Weakness - L
1061551 2023-009 Material Weakness - L

Programs

ALN Program Spent Major Findings
20.106 Airport Improvement Program $44.36M Yes 0
93.558 Temporary Assistance for Needy Families $24.33M - 0
93.575 Child Care and Development Block Grant $20.18M - 0
93.778 Medical Assistance Program $15.88M - 0
93.658 Foster Care_title IV-E $13.24M - 0
93.563 Child Support Enforcement $10.64M - 0
14.239 Home Investment Partnerships Program $10.42M - 0
97.141 Shelter and Services Program $8.62M Yes 0
21.023 Emergency Rental Assistance Program $8.20M Yes 1
93.914 Hiv Emergency Relief Project Grants $8.11M - 0
93.596 Child Care Mandatory and Matching Funds of the Child Care and Development Fund $4.97M - 0
93.659 Adoption Assistance $4.23M - 0
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $3.73M Yes 0
93.667 Social Services Block Grant $3.49M - 0
93.323 Epidemiology and Laboratory Capacity for Infectious Diseases (elc) $2.63M - 0
17.268 H-1b Job Training Grants $2.37M - 0
14.267 Continuum of Care Program $2.12M - 0
14.251 Economic Development Initiative-Special Project, Neighborhood Initiative and Miscellaneous Grants $2.00M Yes 0
97.106 Securing the Cities Program $1.94M - 0
14.218 Community Development Block Grants/entitlement Grants $1.82M - 0
17.258 Wia Adult Program $1.79M - 0
17.207 Employment Service/wagner-Peyser Funded Activities $1.73M Yes 0
97.024 Emergency Food and Shelter National Board Program $1.61M - 0
97.044 Assistance to Firefighters Grant $1.48M - 0
14.231 Emergency Solutions Grant Program $1.25M Yes 4
93.566 Refugee and Entrant Assistance_state Administered Programs $1.23M - 0
93.243 Substance Abuse and Mental Health Services_projects of Regional and National Significance $1.22M - 0
93.569 Community Services Block Grant $1.01M - 0
16.576 Crime Victim Compensation $975,584 - 0
93.600 Head Start $948,259 Yes 1
17.259 Wia Youth Activities $910,435 - 0
93.994 Maternal and Child Health Services Block Grant to the States $852,989 - 0
95.001 High Intensity Drug Trafficking Areas Program $832,198 - 0
93.069 Public Health Emergency Preparedness $699,812 - 0
17.278 Wia Dislocated Worker Formula Grants $696,231 - 0
16.741 Dna Backlog Reduction Program $661,099 - 0
20.200 Highway Research and Development Program $634,826 - 0
11.307 Economic Adjustment Assistance $572,655 - 0
16.738 Edward Byrne Memorial Justice Assistance Grant Program $561,584 - 0
93.967 Cdc's Collaboration with Academia to Strengthen Public Health $519,735 - 0
93.645 Stephanie Tubbs Jones Child Welfare Services Program $510,280 - 0
16.922 Equitable Sharing Program $504,048 - 0
20.600 State and Community Highway Safety $458,685 - 0
20.608 Minimum Penalties for Repeat Offenders for Driving While Intoxicated $392,485 - 0
10.558 Child and Adult Care Food Program $377,436 - 0
17.277 Workforce Investment Act (wia) National Emergency Grants $360,680 - 0
93.090 Guardianship Assistance $332,157 - 0
93.268 Immunization Cooperative Agreements $304,183 - 0
17.270 Reintegration of Ex-Offenders $251,658 - 0
15.435 Gomesa $238,549 - 0
93.556 Promoting Safe and Stable Families $210,566 - 0
97.067 Homeland Security Grant Program $200,564 Yes 0
17.285 Apprenticeship USA Grants $190,350 - 0
10.551 Supplemental Nutrition Assistance Program $183,375 - 0
20.616 National Priority Safety Programs $178,539 - 0
93.674 John H. Chafee Foster Care Program for Successful Transition to Adulthood $175,589 - 0
21.027 Coronavirus State and Local Fiscal Recovery Funds $171,949 Yes 0
93.136 Injury Prevention and Control Research and State and Community Based Programs $166,654 - 0
16.817 Byrne Criminal Justice Innovation Program $157,424 - 0
16.575 Crime Victim Assistance $148,987 - 0
16.710 Public Safety Partnership and Community Policing Grants $148,794 - 0
21.017 Social Impact Partnerships to Pay for Results Act (sippra) (b) $147,858 - 0
93.421 Strengthening Public Health Systems and Services Through National Partnerships to Improve and Protect the Nation’s Health $146,172 - 0
45.149 Promotion of the Humanities_division of Preservation and Access $146,141 - 0
16.588 Violence Against Women Formula Grants $144,625 - 0
81.128 Energy Efficiency and Conservation Block Grant Program (eecbg) $136,970 - 0
16.034 Coronavirus Emergency Supplemental Funding Program $129,437 - 0
10.561 State Administrative Matching Grants for the Supplemental Nutrition Assistance Program $127,030 - 0
16.560 National Institute of Justice Research, Evaluation, and Development Project Grants $122,250 - 0
17.225 Unemployment Insurance $117,470 - 0
16.753 Congressionally Recommended Awards $116,429 - 0
93.086 Healthy Marriage Promotion and Responsible Fatherhood Grants $110,145 - 0
66.818 Brownfields Assessment and Cleanup Cooperative Agreements $97,289 - 0
16.582 Crime Victim Assistance/discretionary Grants $89,890 - 0
16.036 Prosecuting Cold Cases Using Dna $88,917 - 0
97.042 Emergency Management Performance Grants $88,047 - 0
94.006 Americorps $84,546 - 0
11.024 Build to Scale $82,685 - 0
93.648 Child Welfare Research Training Or Demonstration $75,683 - 0
84.425 Education Stabilization Fund $75,594 - 0
93.747 Elder Abuse Prevention Interventions Program $75,046 - 0
93.568 Low-Income Home Energy Assistance $69,163 - 0
16.609 Project Safe Neighborhoods $66,882 - 0
16.320 Services for Trafficking Victims $54,246 - 0
45.309 Museum Grants for African American History and Culture $54,154 - 0
17.245 Trade Adjustment Assistance $43,897 - 0
93.317 Emerging Infections Programs $43,751 - 0
16.742 Paul Coverdell Forensic Sciences Improvement Grant Program $42,636 - 0
93.991 Preventive Health and Health Services Block Grant $38,000 - 0
93.354 Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response $35,222 - 0
45.313 Laura Bush 21st Century Librarian Program $32,772 - 0
20.205 Highway Planning and Construction $18,000 - 0
93.670 Child Abuse and Neglect Discretionary Activities $16,374 - 0
15.658 Natural Resource Damage Assessment and Restoration $13,267 - 0
66.605 Performance Partnership Grants $11,742 - 0
93.391 Activities to Support State, Tribal, Local and Territorial (stlt) Health Department Response to Public Health Or Healthcare Crises $11,342 Yes 0
10.664 Cooperative Forestry Assistance $10,006 - 0
17.801 Jobs for Veterans State Grants $7,644 Yes 0
10.555 National School Lunch Program $5,944 - 0
14.241 Housing Opportunities for Persons with Aids $2,510 - 0
66.808 Solid Waste Management Assistance Grants $2,491 - 0
21.019 Coronavirus Relief Fund $-6 - 0

Contacts

Name Title Type
JHZYLXQAKY33 William Riedell Auditee
7209134854 Randy Watkins Auditor
No contacts on file

Notes to SEFA

Title: Human Services Programs Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal award activity of the primary government of the City and County of Denver (the City). The City’s reporting entity is defined in Note 1 in the City’s basic financial statements 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 City, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the City. The Schedule includes federally funded projects received directly from federal agencies and the federal amount of pass-through awards received by the City through the State of Colorado or other non-federal entities. The City’s basic financial statements include the operations of the Denver Urban Renewal Authority (DURA), a discretely presented component unit, which expended less than $750,000 in federal awards, so is not included in the City’s Schedule of Expenditures of Federal Awards for the year ended December 31, 2023. The City’s summary of significant accounting policies is presented in Note 1 in the City’s basic financial statements. Governmental funds and proprietary funds account for the City’s federal grant activity. Amounts reported in the Schedule for governmental funds are recognized on the modified accrual basis when they become a demand on current available federal resources and other program requirements are met. Available means collectible within the current period, or soon enough thereafter, to pay liabilities of the current period or when matured. The City considers all revenue as available, if collected within 60 days after year end. Amounts reported in the Schedule for proprietary funds are recognized on the accrual basis at the time liabilities are incurred and all other program requirements are met. Certain federal award programs are administered through the Colorado Department of Human Services (CDHS); CDHS reports information for these programs on the cash basis. As a result, these programs, as listed below, are reported in the City's Schedule of Expenditures of Federal Awards on the cash basis (see table). Such expenditures are recognized following, as applicable, the cost principles in OMB A-87 or 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, if any, represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements or reports to federal agencies. De Minimis Rate Used: Both Rate Explanation: The City has elected to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance, except for the following Assistance Listing Numbers (11.024, 16.575, 16.582, 16.738, 17.207, 17.258, 17.259, 17.268, 17.270, 17.277, 17.278, 17.801, 21.027, 66.605, 66.818, 93.069, 93.136, 93.243, 93.268, 93.317, 93.323, 93.354, 93.391, 93.421, 93.566, 93.914, 93.994) which elected to use a rate agreed on through the grant agreement or interagency agreement. The City’s Department of Human Services operates several federally funded human services programs where benefits are provided to qualified citizens. The benefit distribution method consists of participants receiving benefits using a state-maintained electronic banking card (EBT) instead of the City’s cash disbursements. The Colorado Department of Human Services provided total EBT authorizations to qualified citizens in the City, in the amount of $108,204,159, of which $55,742,842 is the federal share. The revenue and expenditures associated with these federal programs are not recognized in the City’s basic financial statements.
Title: State Information Technology System Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal award activity of the primary government of the City and County of Denver (the City). The City’s reporting entity is defined in Note 1 in the City’s basic financial statements 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 City, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the City. The Schedule includes federally funded projects received directly from federal agencies and the federal amount of pass-through awards received by the City through the State of Colorado or other non-federal entities. The City’s basic financial statements include the operations of the Denver Urban Renewal Authority (DURA), a discretely presented component unit, which expended less than $750,000 in federal awards, so is not included in the City’s Schedule of Expenditures of Federal Awards for the year ended December 31, 2023. The City’s summary of significant accounting policies is presented in Note 1 in the City’s basic financial statements. Governmental funds and proprietary funds account for the City’s federal grant activity. Amounts reported in the Schedule for governmental funds are recognized on the modified accrual basis when they become a demand on current available federal resources and other program requirements are met. Available means collectible within the current period, or soon enough thereafter, to pay liabilities of the current period or when matured. The City considers all revenue as available, if collected within 60 days after year end. Amounts reported in the Schedule for proprietary funds are recognized on the accrual basis at the time liabilities are incurred and all other program requirements are met. Certain federal award programs are administered through the Colorado Department of Human Services (CDHS); CDHS reports information for these programs on the cash basis. As a result, these programs, as listed below, are reported in the City's Schedule of Expenditures of Federal Awards on the cash basis (see table). Such expenditures are recognized following, as applicable, the cost principles in OMB A-87 or 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, if any, represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements or reports to federal agencies. De Minimis Rate Used: Both Rate Explanation: The City has elected to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance, except for the following Assistance Listing Numbers (11.024, 16.575, 16.582, 16.738, 17.207, 17.258, 17.259, 17.268, 17.270, 17.277, 17.278, 17.801, 21.027, 66.605, 66.818, 93.069, 93.136, 93.243, 93.268, 93.317, 93.323, 93.354, 93.391, 93.421, 93.566, 93.914, 93.994) which elected to use a rate agreed on through the grant agreement or interagency agreement. In 2004, the State of Colorado (the State) implemented the new Colorado Benefits Management System (CBMS), which consolidated legacy systems into one system and also incorporated a rules engine for determining eligibility and calculating and issuing benefits payments. As a result, the counties and the State split eligibility determination functions for certain federal Human Services’ programs under CBMS. Counties are responsible for data collection from applicants and data entry of applicable information into CBMS. Concurrently, the State maintains the computer system supporting the eligibility determination process and pays benefits to the participants. The actual eligibility and payment determinations become the State’s responsibility utilizing CBMS.
Title: Revolving Loans- Not Subject to Compliance Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal award activity of the primary government of the City and County of Denver (the City). The City’s reporting entity is defined in Note 1 in the City’s basic financial statements 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 City, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the City. The Schedule includes federally funded projects received directly from federal agencies and the federal amount of pass-through awards received by the City through the State of Colorado or other non-federal entities. The City’s basic financial statements include the operations of the Denver Urban Renewal Authority (DURA), a discretely presented component unit, which expended less than $750,000 in federal awards, so is not included in the City’s Schedule of Expenditures of Federal Awards for the year ended December 31, 2023. The City’s summary of significant accounting policies is presented in Note 1 in the City’s basic financial statements. Governmental funds and proprietary funds account for the City’s federal grant activity. Amounts reported in the Schedule for governmental funds are recognized on the modified accrual basis when they become a demand on current available federal resources and other program requirements are met. Available means collectible within the current period, or soon enough thereafter, to pay liabilities of the current period or when matured. The City considers all revenue as available, if collected within 60 days after year end. Amounts reported in the Schedule for proprietary funds are recognized on the accrual basis at the time liabilities are incurred and all other program requirements are met. Certain federal award programs are administered through the Colorado Department of Human Services (CDHS); CDHS reports information for these programs on the cash basis. As a result, these programs, as listed below, are reported in the City's Schedule of Expenditures of Federal Awards on the cash basis (see table). Such expenditures are recognized following, as applicable, the cost principles in OMB A-87 or 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, if any, represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements or reports to federal agencies. De Minimis Rate Used: Both Rate Explanation: The City has elected to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance, except for the following Assistance Listing Numbers (11.024, 16.575, 16.582, 16.738, 17.207, 17.258, 17.259, 17.268, 17.270, 17.277, 17.278, 17.801, 21.027, 66.605, 66.818, 93.069, 93.136, 93.243, 93.268, 93.317, 93.323, 93.354, 93.391, 93.421, 93.566, 93.914, 93.994) which elected to use a rate agreed on through the grant agreement or interagency agreement. The City has certain revolving loan funds, which were originally financed with federal financial assistance through the programs listed below. However, these programs either are not part of a federal loan or loan guarantee program or have no continuing compliance requirements other than continued loan payments, therefore, the outstanding loan balances have not been included in the accompanying Schedule of Expenditures of Federal Awards and major program determination (see table).
Title: Revolving Loans- Subject to Further Compliance Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal award activity of the primary government of the City and County of Denver (the City). The City’s reporting entity is defined in Note 1 in the City’s basic financial statements 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 City, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the City. The Schedule includes federally funded projects received directly from federal agencies and the federal amount of pass-through awards received by the City through the State of Colorado or other non-federal entities. The City’s basic financial statements include the operations of the Denver Urban Renewal Authority (DURA), a discretely presented component unit, which expended less than $750,000 in federal awards, so is not included in the City’s Schedule of Expenditures of Federal Awards for the year ended December 31, 2023. The City’s summary of significant accounting policies is presented in Note 1 in the City’s basic financial statements. Governmental funds and proprietary funds account for the City’s federal grant activity. Amounts reported in the Schedule for governmental funds are recognized on the modified accrual basis when they become a demand on current available federal resources and other program requirements are met. Available means collectible within the current period, or soon enough thereafter, to pay liabilities of the current period or when matured. The City considers all revenue as available, if collected within 60 days after year end. Amounts reported in the Schedule for proprietary funds are recognized on the accrual basis at the time liabilities are incurred and all other program requirements are met. Certain federal award programs are administered through the Colorado Department of Human Services (CDHS); CDHS reports information for these programs on the cash basis. As a result, these programs, as listed below, are reported in the City's Schedule of Expenditures of Federal Awards on the cash basis (see table). Such expenditures are recognized following, as applicable, the cost principles in OMB A-87 or 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, if any, represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements or reports to federal agencies. De Minimis Rate Used: Both Rate Explanation: The City has elected to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance, except for the following Assistance Listing Numbers (11.024, 16.575, 16.582, 16.738, 17.207, 17.258, 17.259, 17.268, 17.270, 17.277, 17.278, 17.801, 21.027, 66.605, 66.818, 93.069, 93.136, 93.243, 93.268, 93.317, 93.323, 93.354, 93.391, 93.421, 93.566, 93.914, 93.994) which elected to use a rate agreed on through the grant agreement or interagency agreement. The City has certain revolving loan funds, which were originally financed with federal financial assistance through the Community Development Block Grant Section 108 Loan Guarantees program (Assistance Listing Number 14.248) which are subject to continuing compliance requirements until project completion and acceptance. There were no outstanding balances subject to continuing compliance as of December 31, 2023. There were no new loans during 2023; therefore nothing has been included in the accompanying Schedule of Expenditures of Federal Awards. The City also has certain revolving loan funds, which were originally financed from the Department of Commerce, under Assistance Listing Number 11.307, Economic Adjustment Assistance which are subject to continuing compliance requirements and included in the Schedule of Expenditures of Federal Awards. The outstanding loan balance as of December 31, 2023, was $226,860 and the cash and investment balance in the loan revolving fund was $345,794. There were no expenditures in 2023 for administrative costs. There were no loan write-offs in 2023. There are no City match requirements.
Title: Revolving Loan - Program Income Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal award activity of the primary government of the City and County of Denver (the City). The City’s reporting entity is defined in Note 1 in the City’s basic financial statements 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 City, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the City. The Schedule includes federally funded projects received directly from federal agencies and the federal amount of pass-through awards received by the City through the State of Colorado or other non-federal entities. The City’s basic financial statements include the operations of the Denver Urban Renewal Authority (DURA), a discretely presented component unit, which expended less than $750,000 in federal awards, so is not included in the City’s Schedule of Expenditures of Federal Awards for the year ended December 31, 2023. The City’s summary of significant accounting policies is presented in Note 1 in the City’s basic financial statements. Governmental funds and proprietary funds account for the City’s federal grant activity. Amounts reported in the Schedule for governmental funds are recognized on the modified accrual basis when they become a demand on current available federal resources and other program requirements are met. Available means collectible within the current period, or soon enough thereafter, to pay liabilities of the current period or when matured. The City considers all revenue as available, if collected within 60 days after year end. Amounts reported in the Schedule for proprietary funds are recognized on the accrual basis at the time liabilities are incurred and all other program requirements are met. Certain federal award programs are administered through the Colorado Department of Human Services (CDHS); CDHS reports information for these programs on the cash basis. As a result, these programs, as listed below, are reported in the City's Schedule of Expenditures of Federal Awards on the cash basis (see table). Such expenditures are recognized following, as applicable, the cost principles in OMB A-87 or 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, if any, represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements or reports to federal agencies. De Minimis Rate Used: Both Rate Explanation: The City has elected to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance, except for the following Assistance Listing Numbers (11.024, 16.575, 16.582, 16.738, 17.207, 17.258, 17.259, 17.268, 17.270, 17.277, 17.278, 17.801, 21.027, 66.605, 66.818, 93.069, 93.136, 93.243, 93.268, 93.317, 93.323, 93.354, 93.391, 93.421, 93.566, 93.914, 93.994) which elected to use a rate agreed on through the grant agreement or interagency agreement. The City has a revolving loan program for low income housing development and renovation. Under this federal program, repayments to the City are considered program revenues (income) and loans of such funds to eligible recipients are considered expenditures. The amount of principal and interest received in loan repayments for the year was $1,577,645. The City also has a revolving loan program for small businesses and economic development. The amount of principal and interest received in loan repayments for the year was $1,090,743.
Title: Program Costs Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal award activity of the primary government of the City and County of Denver (the City). The City’s reporting entity is defined in Note 1 in the City’s basic financial statements 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 City, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the City. The Schedule includes federally funded projects received directly from federal agencies and the federal amount of pass-through awards received by the City through the State of Colorado or other non-federal entities. The City’s basic financial statements include the operations of the Denver Urban Renewal Authority (DURA), a discretely presented component unit, which expended less than $750,000 in federal awards, so is not included in the City’s Schedule of Expenditures of Federal Awards for the year ended December 31, 2023. The City’s summary of significant accounting policies is presented in Note 1 in the City’s basic financial statements. Governmental funds and proprietary funds account for the City’s federal grant activity. Amounts reported in the Schedule for governmental funds are recognized on the modified accrual basis when they become a demand on current available federal resources and other program requirements are met. Available means collectible within the current period, or soon enough thereafter, to pay liabilities of the current period or when matured. The City considers all revenue as available, if collected within 60 days after year end. Amounts reported in the Schedule for proprietary funds are recognized on the accrual basis at the time liabilities are incurred and all other program requirements are met. Certain federal award programs are administered through the Colorado Department of Human Services (CDHS); CDHS reports information for these programs on the cash basis. As a result, these programs, as listed below, are reported in the City's Schedule of Expenditures of Federal Awards on the cash basis (see table). Such expenditures are recognized following, as applicable, the cost principles in OMB A-87 or 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, if any, represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements or reports to federal agencies. De Minimis Rate Used: Both Rate Explanation: The City has elected to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance, except for the following Assistance Listing Numbers (11.024, 16.575, 16.582, 16.738, 17.207, 17.258, 17.259, 17.268, 17.270, 17.277, 17.278, 17.801, 21.027, 66.605, 66.818, 93.069, 93.136, 93.243, 93.268, 93.317, 93.323, 93.354, 93.391, 93.421, 93.566, 93.914, 93.994) which elected to use a rate agreed on through the grant agreement or interagency agreement. The amounts shown as current year expenditures represent only the federal grant portion of the program costs. Entire program costs, including the City's portion, are more than shown. Such expenditures are recognized following, as applicable, either the cost principles in the OMB Circular A-87, Cost Principles for State, Local, and Indian Tribal Governments, or the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Title: Recognition of Prior Year Expenses Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal award activity of the primary government of the City and County of Denver (the City). The City’s reporting entity is defined in Note 1 in the City’s basic financial statements 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 City, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the City. The Schedule includes federally funded projects received directly from federal agencies and the federal amount of pass-through awards received by the City through the State of Colorado or other non-federal entities. The City’s basic financial statements include the operations of the Denver Urban Renewal Authority (DURA), a discretely presented component unit, which expended less than $750,000 in federal awards, so is not included in the City’s Schedule of Expenditures of Federal Awards for the year ended December 31, 2023. The City’s summary of significant accounting policies is presented in Note 1 in the City’s basic financial statements. Governmental funds and proprietary funds account for the City’s federal grant activity. Amounts reported in the Schedule for governmental funds are recognized on the modified accrual basis when they become a demand on current available federal resources and other program requirements are met. Available means collectible within the current period, or soon enough thereafter, to pay liabilities of the current period or when matured. The City considers all revenue as available, if collected within 60 days after year end. Amounts reported in the Schedule for proprietary funds are recognized on the accrual basis at the time liabilities are incurred and all other program requirements are met. Certain federal award programs are administered through the Colorado Department of Human Services (CDHS); CDHS reports information for these programs on the cash basis. As a result, these programs, as listed below, are reported in the City's Schedule of Expenditures of Federal Awards on the cash basis (see table). Such expenditures are recognized following, as applicable, the cost principles in OMB A-87 or 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, if any, represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements or reports to federal agencies. De Minimis Rate Used: Both Rate Explanation: The City has elected to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance, except for the following Assistance Listing Numbers (11.024, 16.575, 16.582, 16.738, 17.207, 17.258, 17.259, 17.268, 17.270, 17.277, 17.278, 17.801, 21.027, 66.605, 66.818, 93.069, 93.136, 93.243, 93.268, 93.317, 93.323, 93.354, 93.391, 93.421, 93.566, 93.914, 93.994) which elected to use a rate agreed on through the grant agreement or interagency agreement. The City incurred eligible expenditures from 2020-2022 which were approved by the Federal Emergency Management Agency (FEMA). The City recorded the eligible expenditures of $3,430,067, in Assistance Listing Number 97.036 in the 2023 Schedule of Expenditures of Federal Awards.
Title: Contingent Liabilities Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal award activity of the primary government of the City and County of Denver (the City). The City’s reporting entity is defined in Note 1 in the City’s basic financial statements 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 City, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the City. The Schedule includes federally funded projects received directly from federal agencies and the federal amount of pass-through awards received by the City through the State of Colorado or other non-federal entities. The City’s basic financial statements include the operations of the Denver Urban Renewal Authority (DURA), a discretely presented component unit, which expended less than $750,000 in federal awards, so is not included in the City’s Schedule of Expenditures of Federal Awards for the year ended December 31, 2023. The City’s summary of significant accounting policies is presented in Note 1 in the City’s basic financial statements. Governmental funds and proprietary funds account for the City’s federal grant activity. Amounts reported in the Schedule for governmental funds are recognized on the modified accrual basis when they become a demand on current available federal resources and other program requirements are met. Available means collectible within the current period, or soon enough thereafter, to pay liabilities of the current period or when matured. The City considers all revenue as available, if collected within 60 days after year end. Amounts reported in the Schedule for proprietary funds are recognized on the accrual basis at the time liabilities are incurred and all other program requirements are met. Certain federal award programs are administered through the Colorado Department of Human Services (CDHS); CDHS reports information for these programs on the cash basis. As a result, these programs, as listed below, are reported in the City's Schedule of Expenditures of Federal Awards on the cash basis (see table). Such expenditures are recognized following, as applicable, the cost principles in OMB A-87 or 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, if any, represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements or reports to federal agencies. De Minimis Rate Used: Both Rate Explanation: The City has elected to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance, except for the following Assistance Listing Numbers (11.024, 16.575, 16.582, 16.738, 17.207, 17.258, 17.259, 17.268, 17.270, 17.277, 17.278, 17.801, 21.027, 66.605, 66.818, 93.069, 93.136, 93.243, 93.268, 93.317, 93.323, 93.354, 93.391, 93.421, 93.566, 93.914, 93.994) which elected to use a rate agreed on through the grant agreement or interagency agreement. Although the Schedule of Expenditures of Federal Awards is prepared to the best of the City's knowledge and belief, amounts received or receivable from grantor agencies are subject to audit and adjustment by the grantor agencies, principally the federal government. Any disallowed claims, including the amount already collected, may constitute a liability of the applicable funds. The amount of expenditures which may be disallowed by the grantor, if any, cannot be determined at this time.
Title: Non-Cash Assistance - Equipment Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal award activity of the primary government of the City and County of Denver (the City). The City’s reporting entity is defined in Note 1 in the City’s basic financial statements 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 City, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the City. The Schedule includes federally funded projects received directly from federal agencies and the federal amount of pass-through awards received by the City through the State of Colorado or other non-federal entities. The City’s basic financial statements include the operations of the Denver Urban Renewal Authority (DURA), a discretely presented component unit, which expended less than $750,000 in federal awards, so is not included in the City’s Schedule of Expenditures of Federal Awards for the year ended December 31, 2023. The City’s summary of significant accounting policies is presented in Note 1 in the City’s basic financial statements. Governmental funds and proprietary funds account for the City’s federal grant activity. Amounts reported in the Schedule for governmental funds are recognized on the modified accrual basis when they become a demand on current available federal resources and other program requirements are met. Available means collectible within the current period, or soon enough thereafter, to pay liabilities of the current period or when matured. The City considers all revenue as available, if collected within 60 days after year end. Amounts reported in the Schedule for proprietary funds are recognized on the accrual basis at the time liabilities are incurred and all other program requirements are met. Certain federal award programs are administered through the Colorado Department of Human Services (CDHS); CDHS reports information for these programs on the cash basis. As a result, these programs, as listed below, are reported in the City's Schedule of Expenditures of Federal Awards on the cash basis (see table). Such expenditures are recognized following, as applicable, the cost principles in OMB A-87 or 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, if any, represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements or reports to federal agencies. De Minimis Rate Used: Both Rate Explanation: The City has elected to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance, except for the following Assistance Listing Numbers (11.024, 16.575, 16.582, 16.738, 17.207, 17.258, 17.259, 17.268, 17.270, 17.277, 17.278, 17.801, 21.027, 66.605, 66.818, 93.069, 93.136, 93.243, 93.268, 93.317, 93.323, 93.354, 93.391, 93.421, 93.566, 93.914, 93.994) which elected to use a rate agreed on through the grant agreement or interagency agreement. The City received equipment that was purchased with federal Homeland Security funds by Arapahoe County. The amount reported on the Schedule is the value of the property on the date it was received by the City.

Finding Details

SPECIAL TESTS AND PROVISIONS- OBLIGATION, EXPENDITURE AND PAYMENT REQUIREMENTS Significant Deficiency in Internal Control Over Compliance ALN 14.231 – Emergency Solutions Grant Program Department of Housing and Urban Development Award Number: E-22-MC-08-0005 Award Year: 2022 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 24 CFR section 576.203(a)(2) states – Within 180 days after the date that HUD signs the grant agreement (or a grant amendment for reallocation of funds) with the metropolitan city, urban county, or territory, the recipient must obligate all the grant amount, except the amount for its administrative costs. This requirement is met by an agreement with, or a letter of award requiring payment to, a subrecipient; a procurement contract; or a written designation of a department within the government of the recipient to directly carry out an eligible activity. Condition: The City’s Department of Housing Stability (HOST) did not have controls in place to ensure funds were obligated within the required obligation period. Cause: Controls were not implemented to ensure funds received under the grant were obligated within the required time frame. Effect or Potential Effect: Funds could be obligated outside of the defined time limit per 24 CFR section 576.203(a)(2). Questioned Costs: Not applicable Context: The control finding was remediated in 2023. However, the control was not present when the City entered into the grant agreement prior to 2023. No control testing was performed because no controls were in operation at the time of the award. Identification as a Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2022-005 in the 2022 report. Recommendation: HOST has developed controls over the timely obligation of Emergency Solutions Grant Program funds. HOST should ensure implementation of such developed controls upon entering into a new signed agreement with HUD. Views of Responsible Officials: The City agrees with the finding. This has been remediated. For additional information, see the City’s separate report for planned corrective actions.
SPECIAL TESTS AND PROVISIONS- OBLIGATION, EXPENDITURE AND PAYMENT REQUIREMENTS Significant Deficiency in Internal Control Over Compliance ALN 14.231 – Emergency Solutions Grant Program Department of Housing and Urban Development Award Number: E-22-MC-08-0005 Award Year: 2022 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 24 CFR section 576.203(a)(2) states – Within 180 days after the date that HUD signs the grant agreement (or a grant amendment for reallocation of funds) with the metropolitan city, urban county, or territory, the recipient must obligate all the grant amount, except the amount for its administrative costs. This requirement is met by an agreement with, or a letter of award requiring payment to, a subrecipient; a procurement contract; or a written designation of a department within the government of the recipient to directly carry out an eligible activity. Condition: The City’s Department of Housing Stability (HOST) did not have controls in place to ensure funds were obligated within the required obligation period. Cause: Controls were not implemented to ensure funds received under the grant were obligated within the required time frame. Effect or Potential Effect: Funds could be obligated outside of the defined time limit per 24 CFR section 576.203(a)(2). Questioned Costs: Not applicable Context: The control finding was remediated in 2023. However, the control was not present when the City entered into the grant agreement prior to 2023. No control testing was performed because no controls were in operation at the time of the award. Identification as a Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2022-005 in the 2022 report. Recommendation: HOST has developed controls over the timely obligation of Emergency Solutions Grant Program funds. HOST should ensure implementation of such developed controls upon entering into a new signed agreement with HUD. Views of Responsible Officials: The City agrees with the finding. This has been remediated. For additional information, see the City’s separate report for planned corrective actions.
PROCUREMENT AND SUSPENSION AND DEBARMENT (FOR SUBRECIPIENTS) Significant Deficiency in Internal Control Over Compliance ALN 14.231 – Emergency Solutions Grant Program Department of Housing and Urban Development Award Number: E-20-MW-08-0005, E-20-MC-08-0005, E-21-MC-08-0005, E-22-MC-08-0005 Award Year: 2020, 2021, 2022 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: The City department of HOST did not have effectively operating controls in place to ensure policies and procedures were followed with respect to suspension and debarment. HOST did have a compensating control in place pertaining to review of contracts to ensure suspension and debarment certifications were present. This was a finding carried over from the prior period. There were no new contracts entered into with subrecipients during 2023. Cause: The department’s review control was not operating effectively to ensure suspension and debarment searches were being performed. No documentation was retained to support such review took place. Effect or Potential Effect: The Department could potentially enter into contracts with subrecipients or vendors who were included on the suspension and debarment listing at SAM.gov. Questioned Costs: Not applicable Context: The control finding was remediated in 2023. However, the control was not present at the time the City entered into agreements with its subrecipients prior to 2023. No control testing was performed because no controls were in operation at the time of award. Identification as a Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2022-008 in the 2022 report. Recommendation: HOST should follow their documented internal control procedures to ensure the SAM.gov search is performed, and documentation is retained to support compliance with internal policies and procedures related to suspension and debarment. A checklist or other tool should be developed to ensure this has been performed prior to contracting. Views of Responsible Officials: The City agrees with the finding. This has been remediated. For additional information, see the City’s separate report for planned corrective actions.
PROCUREMENT AND SUSPENSION AND DEBARMENT (FOR SUBRECIPIENTS) Significant Deficiency in Internal Control Over Compliance ALN 14.231 – Emergency Solutions Grant Program Department of Housing and Urban Development Award Number: E-20-MW-08-0005, E-20-MC-08-0005, E-21-MC-08-0005, E-22-MC-08-0005 Award Year: 2020, 2021, 2022 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: The City department of HOST did not have effectively operating controls in place to ensure policies and procedures were followed with respect to suspension and debarment. HOST did have a compensating control in place pertaining to review of contracts to ensure suspension and debarment certifications were present. This was a finding carried over from the prior period. There were no new contracts entered into with subrecipients during 2023. Cause: The department’s review control was not operating effectively to ensure suspension and debarment searches were being performed. No documentation was retained to support such review took place. Effect or Potential Effect: The Department could potentially enter into contracts with subrecipients or vendors who were included on the suspension and debarment listing at SAM.gov. Questioned Costs: Not applicable Context: The control finding was remediated in 2023. However, the control was not present at the time the City entered into agreements with its subrecipients prior to 2023. No control testing was performed because no controls were in operation at the time of award. Identification as a Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2022-008 in the 2022 report. Recommendation: HOST should follow their documented internal control procedures to ensure the SAM.gov search is performed, and documentation is retained to support compliance with internal policies and procedures related to suspension and debarment. A checklist or other tool should be developed to ensure this has been performed prior to contracting. Views of Responsible Officials: The City agrees with the finding. This has been remediated. For additional information, see the City’s separate report for planned corrective actions.
TESTS AND PROVISIONS- OBLIGATION, EXPENDITURE AND PAYMENT REQUIREMENTS Material Weakness in Internal Control Over Compliance and Material Noncompliance ALN 14.231 – Emergency Solutions Grant Program Department of Housing and Urban Development Award Number: E-20-MW-08-0005, E-20-MC-08-0005, E-21-MC-08-0005, E-22-MC-08-0005 Award Year: 2020, 2021, 2022 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 24 CFR 576.203(c) states – The recipient must pay each subrecipient for allowable costs within 30 days after receiving the subrecipient's complete payment request. Condition: HOST did not have adequate controls in place to ensure subrecipients were timely paid after receiving complete payment requests. HOST did not make payments to its subrecipients within 30 days after receiving complete payment requests. Cause: HOST did not have adequate internal controls in place to ensure payments were made timely to subrecipients. All four of the exceptions had to do with pending budget amendments needing to be made prior to payment, which resulted in payment delays. One exception was submitted to the Controller’s Office for payment prior to the 30-day requirement. However, the payment was still made past the deadline. Effect or Potential Effect: HOST is out of compliance with 24 CFR 576.203(c) regarding payments to subrecipients. Questioned Costs: None reported Context: BDO selected a sample of 13 payments to subrecipients totaling to $383,191 from a population of 101 payments totaling to $1,706,909. There were two payments totaling to $4,015 in which the invoice was not paid within 30 days of receipt of a complete payment request. The compliance sample was expanded and another 11 payments to subrecipients were selected totaling to $176,478. There were an additional two compliance deviations totaling to $24,937. This is a condition identified per review of the City’s compliance with specified requirements using a sample that was not statistically valid. Identification as a Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2022-006 in the 2022 report. Recommendation: HOST should improve upon its implemented controls to ensure subrecipients who submit complete invoices for payment are paid within 30 days. Improvements should include documenting when complete subrecipient pay requests have been received and the subsequent 30-day deadline. Steps should be taken to reduce the frequency and time associated with budget modifications to ensure payments are made timely. Finally, communication should take place between HOST and the Controller’s Office to expedite payments to subrecipients and prevent unnecessary delays. Views of Responsible Officials: The City agrees with the finding and internal policies have been updated to require finance budget review prior to contract execution to avoid budget modifications during the payment process. HOST is also engaged in an application upgrade that is in the final user acceptance phase to incorporate changes that now include status tracking for vendor invoice submissions and reimbursement payments. For additional information, see the City’s separate report for planned corrective actions.
TESTS AND PROVISIONS- OBLIGATION, EXPENDITURE AND PAYMENT REQUIREMENTS Material Weakness in Internal Control Over Compliance and Material Noncompliance ALN 14.231 – Emergency Solutions Grant Program Department of Housing and Urban Development Award Number: E-20-MW-08-0005, E-20-MC-08-0005, E-21-MC-08-0005, E-22-MC-08-0005 Award Year: 2020, 2021, 2022 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 24 CFR 576.203(c) states – The recipient must pay each subrecipient for allowable costs within 30 days after receiving the subrecipient's complete payment request. Condition: HOST did not have adequate controls in place to ensure subrecipients were timely paid after receiving complete payment requests. HOST did not make payments to its subrecipients within 30 days after receiving complete payment requests. Cause: HOST did not have adequate internal controls in place to ensure payments were made timely to subrecipients. All four of the exceptions had to do with pending budget amendments needing to be made prior to payment, which resulted in payment delays. One exception was submitted to the Controller’s Office for payment prior to the 30-day requirement. However, the payment was still made past the deadline. Effect or Potential Effect: HOST is out of compliance with 24 CFR 576.203(c) regarding payments to subrecipients. Questioned Costs: None reported Context: BDO selected a sample of 13 payments to subrecipients totaling to $383,191 from a population of 101 payments totaling to $1,706,909. There were two payments totaling to $4,015 in which the invoice was not paid within 30 days of receipt of a complete payment request. The compliance sample was expanded and another 11 payments to subrecipients were selected totaling to $176,478. There were an additional two compliance deviations totaling to $24,937. This is a condition identified per review of the City’s compliance with specified requirements using a sample that was not statistically valid. Identification as a Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2022-006 in the 2022 report. Recommendation: HOST should improve upon its implemented controls to ensure subrecipients who submit complete invoices for payment are paid within 30 days. Improvements should include documenting when complete subrecipient pay requests have been received and the subsequent 30-day deadline. Steps should be taken to reduce the frequency and time associated with budget modifications to ensure payments are made timely. Finally, communication should take place between HOST and the Controller’s Office to expedite payments to subrecipients and prevent unnecessary delays. Views of Responsible Officials: The City agrees with the finding and internal policies have been updated to require finance budget review prior to contract execution to avoid budget modifications during the payment process. HOST is also engaged in an application upgrade that is in the final user acceptance phase to incorporate changes that now include status tracking for vendor invoice submissions and reimbursement payments. For additional information, see the City’s separate report for planned corrective actions.
MONITORING Significant Deficiency in Internal Control Over Compliance and Noncompliance ALN 93.391 – Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcare Crises Department of Health and Human Services Award Number: NH75OT0000010 Award Year: 2021 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. The Uniform Guidance in 2 CFR Section 200.332 states- All pass-through entities must ensure that every subaward is clearly identified to the subrecipient and includes the following information at the time of the subaward as follows: (1) Federal award identification, (2) All requirements imposed by the pass-through entity on the subrecipient so that the Federal award is used in accordance with Federal statutes, regulations, and terms and conditions of the Federal award; (3) Any additional requirements that the pass-through entity imposes on the subrecipient in order for the pass-through entity to meet its own responsibility to the Federal awarding agency including identification of any required financial and performance reports, (4) A requirement that the subrecipient permit the pass-through entity and auditors to have access to the subrecipient’s records and financial statements as necessary for the pass-through entity to meet the requirements of this part; and (5) Appropriate terms and conditions concerning the closeout of the subaward. Condition: For all four subrecipients tested, subaward agreements did not include the award information required under 2 CFR 200.332. This was a finding carried over from the prior period. There were no new contracts entered into with subrecipients during 2023. Cause: Subaward agreements were not properly written and appropriately reviewed to ensure all required award information was included. Effect or Potential Effect: Denver Department of Public Health and Environment (DDPHE) was not in compliance with subrecipient requirements outlined in 2 CFR Section 200.332. Furthermore, not communicating proper compliance requirements and other information may increase the likelihood of noncompliance on the part of the subrecipient and non-fulfillment of program goals and objectives. In addition, this also increases the risk the subrecipient may not understand they are receiving Federal funds, which could result in subrecipients failing to comply with the Uniform Guidance or pass-through entity requirements for the award. Questioned Costs: Not applicable Context: The control finding was remediated in 2023. However, the control was not present when DDPHE entered into agreements with its subrecipients. These were the same contracts in existence in the prior period. The grant ended on May 31, 2023, and was closed out. Identification as a Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2022-007 in the 2022 report. Recommendation: DDPHE should revise future subaward agreements to include specific Federal award identification information and language clearly stating applicable audit requirements subrecipients must comply with to ensure all agreements comply with the requirements in 2 CFR Section 200.332. Views of Responsible Officials: This has been remediated. For additional information, see the City’s separate report for planned corrective actions.
SPECIAL TESTS AND PROVISIONS- OBLIGATION, EXPENDITURE AND PAYMENT REQUIREMENTS Significant Deficiency in Internal Control Over Compliance and Noncompliance ALN 14.231 – Emergency Solutions Grant Program Department of Housing and Urban Development Award Number: E-22-MC-08-0005 Award Year: 2022 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 24 CFR 576.203(b) states - All of the recipient’s grant must be expended for eligible activity costs within 24 months after HUD signs the grant agreement with the recipient. Condition: Controls in place at the City’s Department of Housing Stability (HOST) were not effective in preventing expenditures from being incurred outside of the 24-month requirement. There was one instance where the existence of a control failed to prevent grant charges being made to the grant outside of the 24-month period. Cause: Personnel reviewing expenditures did not adequately review to ensure expenditures for the Emergency Solutions Grant Program were incurred within the 24-month period. Effect or Potential Effect: Funds were expended outside of the 24-month time limit outlined per 24 CFR section 576.203(b). Questioned Costs: $2,427 Context: BDO selected a sample of seven expenditures totaling to $74,735 from a population of 19 expenditures totaling to $128,803. There was one expenditure in the amount of $2,427 that was incurred outside of the 24-month period. The compliance sample was expanded, and another three expenditures were selected totaling to $17,060. There were no additional compliance deviations noted. This is a condition identified per review of the City’s compliance with specified requirements using a sample that was not statistically valid. Identification as a Repeat Finding: N/A Recommendation: HOST should improve existing review controls to ensure Emergency Solutions Grant Program annual grants expiring are monitored to ensure expenditures are not charged to grants outside of the 24-month period. Grants should be monitored, and prior to grant expiration, special instructions should be distributed to personnel reviewing expenses informing them of the grant cutoff and items potentially charged outside of the period of performance. Views of Responsible Officials: The City agrees with the finding. The Division of Operations and Impact has established policies and procedures that seek to ensure internal controls are in place to ensure that eligible expenditures are within a grant’s period of performance. For additional information, see the City’s separate report for planned corrective actions.
SPECIAL TESTS AND PROVISIONS- OBLIGATION, EXPENDITURE AND PAYMENT REQUIREMENTS Significant Deficiency in Internal Control Over Compliance and Noncompliance ALN 14.231 – Emergency Solutions Grant Program Department of Housing and Urban Development Award Number: E-22-MC-08-0005 Award Year: 2022 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 24 CFR 576.203(b) states - All of the recipient’s grant must be expended for eligible activity costs within 24 months after HUD signs the grant agreement with the recipient. Condition: Controls in place at the City’s Department of Housing Stability (HOST) were not effective in preventing expenditures from being incurred outside of the 24-month requirement. There was one instance where the existence of a control failed to prevent grant charges being made to the grant outside of the 24-month period. Cause: Personnel reviewing expenditures did not adequately review to ensure expenditures for the Emergency Solutions Grant Program were incurred within the 24-month period. Effect or Potential Effect: Funds were expended outside of the 24-month time limit outlined per 24 CFR section 576.203(b). Questioned Costs: $2,427 Context: BDO selected a sample of seven expenditures totaling to $74,735 from a population of 19 expenditures totaling to $128,803. There was one expenditure in the amount of $2,427 that was incurred outside of the 24-month period. The compliance sample was expanded, and another three expenditures were selected totaling to $17,060. There were no additional compliance deviations noted. This is a condition identified per review of the City’s compliance with specified requirements using a sample that was not statistically valid. Identification as a Repeat Finding: N/A Recommendation: HOST should improve existing review controls to ensure Emergency Solutions Grant Program annual grants expiring are monitored to ensure expenditures are not charged to grants outside of the 24-month period. Grants should be monitored, and prior to grant expiration, special instructions should be distributed to personnel reviewing expenses informing them of the grant cutoff and items potentially charged outside of the period of performance. Views of Responsible Officials: The City agrees with the finding. The Division of Operations and Impact has established policies and procedures that seek to ensure internal controls are in place to ensure that eligible expenditures are within a grant’s period of performance. For additional information, see the City’s separate report for planned corrective actions.
ACTIVITIES ALLOWED OR UNALLOWED AND ALLOWABLE COSTS/COST PRINCIPLES Significant Deficiency in Internal Control Over Compliance and Noncompliance ALN 93.391 – Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcare Crises Department of Health and Human Services Award Number: NH75OT0000010 Award Year: 2021 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. The Uniform Guidance in 2 CFR Section 200.403(g) states that for costs to be allowable under Federal awards, they must be adequately documented. Condition: Controls in place at the City’s Department of Public Health and Environment (DDPHE) were not effective in preventing incorrect expenditures from being charged to the grant. There was one instance where the existence of a control failed to detect an error within an invoice selected, which resulted in an overpayment to the subrecipient. Cause: Personnel reviewing expenditures did not adequately review to ensure invoices were correct prior to payment. Effect or Potential Effect: An invoice to a subrecipient was overpaid. Questioned Costs: $431 Context: BDO selected a sample of 20 expenditures totaling to $216,560 from a population of 162 expenditures totaling to $625,782. There was one expenditure in the amount of $4,101 that was overpaid. The compliance sample was expanded, and another 12 expenditures were selected totaling to $29,975. There were no additional compliance deviations noted. This is a condition identified per review of the City’s compliance with specified requirements using a sample that was not statistically valid. Identification as a Repeat Finding: N/A Recommendation: DDPHE should improve existing review controls to ensure the mathematical accuracy of invoices has been checked, especially with respect to payments to subrecipients. Payroll and other costs reported on the face of the invoice should agree to supporting payroll documentation received. Views of Responsible Officials: The City agrees with the finding. DDPHE will implement additional trainings and is encouraging a standard template in Excel to avoid calculation errors. For additional information, see the City’s separate report for planned corrective actions.
REPORTING Significant Deficiency in Internal Control Over Compliance and Noncompliance ALN 21.023 – Emergency Rental Assistance Program Department of the Treasury Award Number: ERAE0436; ERAE0437 Award Year: 2021 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. ERA Reporting Guidance v 3.4 identifies quarterly reports required to be submitted for the Emergency Rental Assistance Program (ERAP). Key line items for these reports are outlined within the Compliance Supplement and include (1) administrative costs ratio, (2) housing stability services ratio, (3) system for prioritizing assistance, and (4) participant households at certain income levels of eligibility. Condition: Controls over reviews of quarterly reports in place at the City’s Department of Housing Stability (HOST) were not effective in detecting an error in expenditures reported on a quarterly report. Cause: The Department’s supervisory and review control was not operating effectively to ensure that all key line items reported in the quarterly reports were properly supported. Effect or Potential Effect: The quarterly report for the fourth quarter contained an error pertaining to total expenditures. Ineffective controls could result in ratios such as the administrative costs and housing stability services to be incorrect. Questioned Costs: Not applicable Context: We tested a sample of three reports from a population of four. We identified exceptions in one of the reports tested. The exception was as follows:  ERA2 Quarter 4 Report- Total expenditures reported for the period differed from what was reported on HOST supporting spreadsheets. This difference was between housing stability services expenditures, which were reported as $52,154 as opposed to $40,484, which was a difference of $11,659. This is a condition identified per review of the City’s compliance with specified requirements using a sample that was not statistically valid. Identification as a Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2022-011 in the 2022 report. Recommendation: Reviews of reports should be more thorough, which will increase the probability that such reporting errors are detected. The reviews can be improved by implementing a reporting checklist, which contains steps outlined in reviewing a report, including determining whether the report is mathematically accurate and agrees to underlying documentation. Underlying documentation should also be reviewed to determine if any errors exist within that documentation that could cause errors within the report. Views of Responsible Officials: The City disagrees with the finding. Review of the ERA2 administration costs did not consider the timing of the static report submission. The report was prior to monthly close/reconciliation, which occurred the following month. For additional information, see the City’s separate report for planned corrective actions.
REPORTING Material Weakness in Internal Control Over Compliance and Noncompliance ALN 93.600 – Head Start Program Administration for Children and Families Award Number: 08CH010552; 08HE000797 Award Year: 2021; 2022; 2023 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. The Federal Funding Accountability and Transparency Act (FFATA), codified under 2 CFR Part 170, requires recipients of grants or cooperative agreements to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Recipients must report each first-tier subaward or subaward amendment that results in an obligation of $30,000 or more in Federal funds. These actions must be reported in FSRS no later than the last day of the month following the month in which the subaward/subaward amendment obligation was made. Condition: Testing of FFATA reporting indicated all reports submitted had the incorrect obligation amounts reported. Reports to FSRS were also not submitted timely and in some cases no report was submitted. Cause: Personnel administering the grant had an incorrect understanding of the reporting requirements under FFATA. Effect or Potential Effect: The Federal government is not receiving accurate and up to date information on subawards and changes in subaward obligations made to first-tier subrecipients by the City. Questioned Costs: Not applicable Context: BDO selected a sample of three subrecipients with nine contracts and related amendments totaling to $16,650,842. There were nine instances of noncompliance in which the obligations/modifications totaling $16,650,842 were either not reported or reported incorrectly. There were three instances of noncompliance in which required key data elements for contracts totaling $958,676 were not reported or were reported incorrectly. There were nine instances of noncompliance where the reporting to FSRS was not submitted timely. This is a condition identified per review of the City’s compliance with specified requirements using a sample that was not statistically valid. Identification as a Repeat Finding: N/A Recommendation: An understanding of FFATA reporting requirements should be obtained through training and continuing education. This will enable more effective controls to be implemented to ensure such reporting requirements are followed. Views of Responsible Officials: The City agrees with the finding. The department is updating internal procedures for reporting for FFATA amounts in the period of obligation rather than when the expense was incurred. For additional information, see the City’s separate report for planned corrective actions.
REPORTING Material Weakness in Internal Control Over Compliance and Noncompliance ALN 93.600 – Head Start Program Administration for Children and Families Award Number: 08CH010552; 08HE000797 Award Year: 2021; 2022; 2023 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. The Federal Funding Accountability and Transparency Act (FFATA), codified under 2 CFR Part 170, requires recipients of grants or cooperative agreements to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Recipients must report each first-tier subaward or subaward amendment that results in an obligation of $30,000 or more in Federal funds. These actions must be reported in FSRS no later than the last day of the month following the month in which the subaward/subaward amendment obligation was made. Condition: Testing of FFATA reporting indicated all reports submitted had the incorrect obligation amounts reported. Reports to FSRS were also not submitted timely and in some cases no report was submitted. Cause: Personnel administering the grant had an incorrect understanding of the reporting requirements under FFATA. Effect or Potential Effect: The Federal government is not receiving accurate and up to date information on subawards and changes in subaward obligations made to first-tier subrecipients by the City. Questioned Costs: Not applicable Context: BDO selected a sample of three subrecipients with nine contracts and related amendments totaling to $16,650,842. There were nine instances of noncompliance in which the obligations/modifications totaling $16,650,842 were either not reported or reported incorrectly. There were three instances of noncompliance in which required key data elements for contracts totaling $958,676 were not reported or were reported incorrectly. There were nine instances of noncompliance where the reporting to FSRS was not submitted timely. This is a condition identified per review of the City’s compliance with specified requirements using a sample that was not statistically valid. Identification as a Repeat Finding: N/A Recommendation: An understanding of FFATA reporting requirements should be obtained through training and continuing education. This will enable more effective controls to be implemented to ensure such reporting requirements are followed. Views of Responsible Officials: The City agrees with the finding. The department is updating internal procedures for reporting for FFATA amounts in the period of obligation rather than when the expense was incurred. For additional information, see the City’s separate report for planned corrective actions.
SPECIAL TESTS AND PROVISIONS- OBLIGATION, EXPENDITURE AND PAYMENT REQUIREMENTS Significant Deficiency in Internal Control Over Compliance ALN 14.231 – Emergency Solutions Grant Program Department of Housing and Urban Development Award Number: E-22-MC-08-0005 Award Year: 2022 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 24 CFR section 576.203(a)(2) states – Within 180 days after the date that HUD signs the grant agreement (or a grant amendment for reallocation of funds) with the metropolitan city, urban county, or territory, the recipient must obligate all the grant amount, except the amount for its administrative costs. This requirement is met by an agreement with, or a letter of award requiring payment to, a subrecipient; a procurement contract; or a written designation of a department within the government of the recipient to directly carry out an eligible activity. Condition: The City’s Department of Housing Stability (HOST) did not have controls in place to ensure funds were obligated within the required obligation period. Cause: Controls were not implemented to ensure funds received under the grant were obligated within the required time frame. Effect or Potential Effect: Funds could be obligated outside of the defined time limit per 24 CFR section 576.203(a)(2). Questioned Costs: Not applicable Context: The control finding was remediated in 2023. However, the control was not present when the City entered into the grant agreement prior to 2023. No control testing was performed because no controls were in operation at the time of the award. Identification as a Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2022-005 in the 2022 report. Recommendation: HOST has developed controls over the timely obligation of Emergency Solutions Grant Program funds. HOST should ensure implementation of such developed controls upon entering into a new signed agreement with HUD. Views of Responsible Officials: The City agrees with the finding. This has been remediated. For additional information, see the City’s separate report for planned corrective actions.
SPECIAL TESTS AND PROVISIONS- OBLIGATION, EXPENDITURE AND PAYMENT REQUIREMENTS Significant Deficiency in Internal Control Over Compliance ALN 14.231 – Emergency Solutions Grant Program Department of Housing and Urban Development Award Number: E-22-MC-08-0005 Award Year: 2022 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 24 CFR section 576.203(a)(2) states – Within 180 days after the date that HUD signs the grant agreement (or a grant amendment for reallocation of funds) with the metropolitan city, urban county, or territory, the recipient must obligate all the grant amount, except the amount for its administrative costs. This requirement is met by an agreement with, or a letter of award requiring payment to, a subrecipient; a procurement contract; or a written designation of a department within the government of the recipient to directly carry out an eligible activity. Condition: The City’s Department of Housing Stability (HOST) did not have controls in place to ensure funds were obligated within the required obligation period. Cause: Controls were not implemented to ensure funds received under the grant were obligated within the required time frame. Effect or Potential Effect: Funds could be obligated outside of the defined time limit per 24 CFR section 576.203(a)(2). Questioned Costs: Not applicable Context: The control finding was remediated in 2023. However, the control was not present when the City entered into the grant agreement prior to 2023. No control testing was performed because no controls were in operation at the time of the award. Identification as a Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2022-005 in the 2022 report. Recommendation: HOST has developed controls over the timely obligation of Emergency Solutions Grant Program funds. HOST should ensure implementation of such developed controls upon entering into a new signed agreement with HUD. Views of Responsible Officials: The City agrees with the finding. This has been remediated. For additional information, see the City’s separate report for planned corrective actions.
PROCUREMENT AND SUSPENSION AND DEBARMENT (FOR SUBRECIPIENTS) Significant Deficiency in Internal Control Over Compliance ALN 14.231 – Emergency Solutions Grant Program Department of Housing and Urban Development Award Number: E-20-MW-08-0005, E-20-MC-08-0005, E-21-MC-08-0005, E-22-MC-08-0005 Award Year: 2020, 2021, 2022 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: The City department of HOST did not have effectively operating controls in place to ensure policies and procedures were followed with respect to suspension and debarment. HOST did have a compensating control in place pertaining to review of contracts to ensure suspension and debarment certifications were present. This was a finding carried over from the prior period. There were no new contracts entered into with subrecipients during 2023. Cause: The department’s review control was not operating effectively to ensure suspension and debarment searches were being performed. No documentation was retained to support such review took place. Effect or Potential Effect: The Department could potentially enter into contracts with subrecipients or vendors who were included on the suspension and debarment listing at SAM.gov. Questioned Costs: Not applicable Context: The control finding was remediated in 2023. However, the control was not present at the time the City entered into agreements with its subrecipients prior to 2023. No control testing was performed because no controls were in operation at the time of award. Identification as a Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2022-008 in the 2022 report. Recommendation: HOST should follow their documented internal control procedures to ensure the SAM.gov search is performed, and documentation is retained to support compliance with internal policies and procedures related to suspension and debarment. A checklist or other tool should be developed to ensure this has been performed prior to contracting. Views of Responsible Officials: The City agrees with the finding. This has been remediated. For additional information, see the City’s separate report for planned corrective actions.
PROCUREMENT AND SUSPENSION AND DEBARMENT (FOR SUBRECIPIENTS) Significant Deficiency in Internal Control Over Compliance ALN 14.231 – Emergency Solutions Grant Program Department of Housing and Urban Development Award Number: E-20-MW-08-0005, E-20-MC-08-0005, E-21-MC-08-0005, E-22-MC-08-0005 Award Year: 2020, 2021, 2022 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: The City department of HOST did not have effectively operating controls in place to ensure policies and procedures were followed with respect to suspension and debarment. HOST did have a compensating control in place pertaining to review of contracts to ensure suspension and debarment certifications were present. This was a finding carried over from the prior period. There were no new contracts entered into with subrecipients during 2023. Cause: The department’s review control was not operating effectively to ensure suspension and debarment searches were being performed. No documentation was retained to support such review took place. Effect or Potential Effect: The Department could potentially enter into contracts with subrecipients or vendors who were included on the suspension and debarment listing at SAM.gov. Questioned Costs: Not applicable Context: The control finding was remediated in 2023. However, the control was not present at the time the City entered into agreements with its subrecipients prior to 2023. No control testing was performed because no controls were in operation at the time of award. Identification as a Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2022-008 in the 2022 report. Recommendation: HOST should follow their documented internal control procedures to ensure the SAM.gov search is performed, and documentation is retained to support compliance with internal policies and procedures related to suspension and debarment. A checklist or other tool should be developed to ensure this has been performed prior to contracting. Views of Responsible Officials: The City agrees with the finding. This has been remediated. For additional information, see the City’s separate report for planned corrective actions.
TESTS AND PROVISIONS- OBLIGATION, EXPENDITURE AND PAYMENT REQUIREMENTS Material Weakness in Internal Control Over Compliance and Material Noncompliance ALN 14.231 – Emergency Solutions Grant Program Department of Housing and Urban Development Award Number: E-20-MW-08-0005, E-20-MC-08-0005, E-21-MC-08-0005, E-22-MC-08-0005 Award Year: 2020, 2021, 2022 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 24 CFR 576.203(c) states – The recipient must pay each subrecipient for allowable costs within 30 days after receiving the subrecipient's complete payment request. Condition: HOST did not have adequate controls in place to ensure subrecipients were timely paid after receiving complete payment requests. HOST did not make payments to its subrecipients within 30 days after receiving complete payment requests. Cause: HOST did not have adequate internal controls in place to ensure payments were made timely to subrecipients. All four of the exceptions had to do with pending budget amendments needing to be made prior to payment, which resulted in payment delays. One exception was submitted to the Controller’s Office for payment prior to the 30-day requirement. However, the payment was still made past the deadline. Effect or Potential Effect: HOST is out of compliance with 24 CFR 576.203(c) regarding payments to subrecipients. Questioned Costs: None reported Context: BDO selected a sample of 13 payments to subrecipients totaling to $383,191 from a population of 101 payments totaling to $1,706,909. There were two payments totaling to $4,015 in which the invoice was not paid within 30 days of receipt of a complete payment request. The compliance sample was expanded and another 11 payments to subrecipients were selected totaling to $176,478. There were an additional two compliance deviations totaling to $24,937. This is a condition identified per review of the City’s compliance with specified requirements using a sample that was not statistically valid. Identification as a Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2022-006 in the 2022 report. Recommendation: HOST should improve upon its implemented controls to ensure subrecipients who submit complete invoices for payment are paid within 30 days. Improvements should include documenting when complete subrecipient pay requests have been received and the subsequent 30-day deadline. Steps should be taken to reduce the frequency and time associated with budget modifications to ensure payments are made timely. Finally, communication should take place between HOST and the Controller’s Office to expedite payments to subrecipients and prevent unnecessary delays. Views of Responsible Officials: The City agrees with the finding and internal policies have been updated to require finance budget review prior to contract execution to avoid budget modifications during the payment process. HOST is also engaged in an application upgrade that is in the final user acceptance phase to incorporate changes that now include status tracking for vendor invoice submissions and reimbursement payments. For additional information, see the City’s separate report for planned corrective actions.
TESTS AND PROVISIONS- OBLIGATION, EXPENDITURE AND PAYMENT REQUIREMENTS Material Weakness in Internal Control Over Compliance and Material Noncompliance ALN 14.231 – Emergency Solutions Grant Program Department of Housing and Urban Development Award Number: E-20-MW-08-0005, E-20-MC-08-0005, E-21-MC-08-0005, E-22-MC-08-0005 Award Year: 2020, 2021, 2022 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 24 CFR 576.203(c) states – The recipient must pay each subrecipient for allowable costs within 30 days after receiving the subrecipient's complete payment request. Condition: HOST did not have adequate controls in place to ensure subrecipients were timely paid after receiving complete payment requests. HOST did not make payments to its subrecipients within 30 days after receiving complete payment requests. Cause: HOST did not have adequate internal controls in place to ensure payments were made timely to subrecipients. All four of the exceptions had to do with pending budget amendments needing to be made prior to payment, which resulted in payment delays. One exception was submitted to the Controller’s Office for payment prior to the 30-day requirement. However, the payment was still made past the deadline. Effect or Potential Effect: HOST is out of compliance with 24 CFR 576.203(c) regarding payments to subrecipients. Questioned Costs: None reported Context: BDO selected a sample of 13 payments to subrecipients totaling to $383,191 from a population of 101 payments totaling to $1,706,909. There were two payments totaling to $4,015 in which the invoice was not paid within 30 days of receipt of a complete payment request. The compliance sample was expanded and another 11 payments to subrecipients were selected totaling to $176,478. There were an additional two compliance deviations totaling to $24,937. This is a condition identified per review of the City’s compliance with specified requirements using a sample that was not statistically valid. Identification as a Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2022-006 in the 2022 report. Recommendation: HOST should improve upon its implemented controls to ensure subrecipients who submit complete invoices for payment are paid within 30 days. Improvements should include documenting when complete subrecipient pay requests have been received and the subsequent 30-day deadline. Steps should be taken to reduce the frequency and time associated with budget modifications to ensure payments are made timely. Finally, communication should take place between HOST and the Controller’s Office to expedite payments to subrecipients and prevent unnecessary delays. Views of Responsible Officials: The City agrees with the finding and internal policies have been updated to require finance budget review prior to contract execution to avoid budget modifications during the payment process. HOST is also engaged in an application upgrade that is in the final user acceptance phase to incorporate changes that now include status tracking for vendor invoice submissions and reimbursement payments. For additional information, see the City’s separate report for planned corrective actions.
MONITORING Significant Deficiency in Internal Control Over Compliance and Noncompliance ALN 93.391 – Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcare Crises Department of Health and Human Services Award Number: NH75OT0000010 Award Year: 2021 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. The Uniform Guidance in 2 CFR Section 200.332 states- All pass-through entities must ensure that every subaward is clearly identified to the subrecipient and includes the following information at the time of the subaward as follows: (1) Federal award identification, (2) All requirements imposed by the pass-through entity on the subrecipient so that the Federal award is used in accordance with Federal statutes, regulations, and terms and conditions of the Federal award; (3) Any additional requirements that the pass-through entity imposes on the subrecipient in order for the pass-through entity to meet its own responsibility to the Federal awarding agency including identification of any required financial and performance reports, (4) A requirement that the subrecipient permit the pass-through entity and auditors to have access to the subrecipient’s records and financial statements as necessary for the pass-through entity to meet the requirements of this part; and (5) Appropriate terms and conditions concerning the closeout of the subaward. Condition: For all four subrecipients tested, subaward agreements did not include the award information required under 2 CFR 200.332. This was a finding carried over from the prior period. There were no new contracts entered into with subrecipients during 2023. Cause: Subaward agreements were not properly written and appropriately reviewed to ensure all required award information was included. Effect or Potential Effect: Denver Department of Public Health and Environment (DDPHE) was not in compliance with subrecipient requirements outlined in 2 CFR Section 200.332. Furthermore, not communicating proper compliance requirements and other information may increase the likelihood of noncompliance on the part of the subrecipient and non-fulfillment of program goals and objectives. In addition, this also increases the risk the subrecipient may not understand they are receiving Federal funds, which could result in subrecipients failing to comply with the Uniform Guidance or pass-through entity requirements for the award. Questioned Costs: Not applicable Context: The control finding was remediated in 2023. However, the control was not present when DDPHE entered into agreements with its subrecipients. These were the same contracts in existence in the prior period. The grant ended on May 31, 2023, and was closed out. Identification as a Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2022-007 in the 2022 report. Recommendation: DDPHE should revise future subaward agreements to include specific Federal award identification information and language clearly stating applicable audit requirements subrecipients must comply with to ensure all agreements comply with the requirements in 2 CFR Section 200.332. Views of Responsible Officials: This has been remediated. For additional information, see the City’s separate report for planned corrective actions.
SPECIAL TESTS AND PROVISIONS- OBLIGATION, EXPENDITURE AND PAYMENT REQUIREMENTS Significant Deficiency in Internal Control Over Compliance and Noncompliance ALN 14.231 – Emergency Solutions Grant Program Department of Housing and Urban Development Award Number: E-22-MC-08-0005 Award Year: 2022 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 24 CFR 576.203(b) states - All of the recipient’s grant must be expended for eligible activity costs within 24 months after HUD signs the grant agreement with the recipient. Condition: Controls in place at the City’s Department of Housing Stability (HOST) were not effective in preventing expenditures from being incurred outside of the 24-month requirement. There was one instance where the existence of a control failed to prevent grant charges being made to the grant outside of the 24-month period. Cause: Personnel reviewing expenditures did not adequately review to ensure expenditures for the Emergency Solutions Grant Program were incurred within the 24-month period. Effect or Potential Effect: Funds were expended outside of the 24-month time limit outlined per 24 CFR section 576.203(b). Questioned Costs: $2,427 Context: BDO selected a sample of seven expenditures totaling to $74,735 from a population of 19 expenditures totaling to $128,803. There was one expenditure in the amount of $2,427 that was incurred outside of the 24-month period. The compliance sample was expanded, and another three expenditures were selected totaling to $17,060. There were no additional compliance deviations noted. This is a condition identified per review of the City’s compliance with specified requirements using a sample that was not statistically valid. Identification as a Repeat Finding: N/A Recommendation: HOST should improve existing review controls to ensure Emergency Solutions Grant Program annual grants expiring are monitored to ensure expenditures are not charged to grants outside of the 24-month period. Grants should be monitored, and prior to grant expiration, special instructions should be distributed to personnel reviewing expenses informing them of the grant cutoff and items potentially charged outside of the period of performance. Views of Responsible Officials: The City agrees with the finding. The Division of Operations and Impact has established policies and procedures that seek to ensure internal controls are in place to ensure that eligible expenditures are within a grant’s period of performance. For additional information, see the City’s separate report for planned corrective actions.
SPECIAL TESTS AND PROVISIONS- OBLIGATION, EXPENDITURE AND PAYMENT REQUIREMENTS Significant Deficiency in Internal Control Over Compliance and Noncompliance ALN 14.231 – Emergency Solutions Grant Program Department of Housing and Urban Development Award Number: E-22-MC-08-0005 Award Year: 2022 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 24 CFR 576.203(b) states - All of the recipient’s grant must be expended for eligible activity costs within 24 months after HUD signs the grant agreement with the recipient. Condition: Controls in place at the City’s Department of Housing Stability (HOST) were not effective in preventing expenditures from being incurred outside of the 24-month requirement. There was one instance where the existence of a control failed to prevent grant charges being made to the grant outside of the 24-month period. Cause: Personnel reviewing expenditures did not adequately review to ensure expenditures for the Emergency Solutions Grant Program were incurred within the 24-month period. Effect or Potential Effect: Funds were expended outside of the 24-month time limit outlined per 24 CFR section 576.203(b). Questioned Costs: $2,427 Context: BDO selected a sample of seven expenditures totaling to $74,735 from a population of 19 expenditures totaling to $128,803. There was one expenditure in the amount of $2,427 that was incurred outside of the 24-month period. The compliance sample was expanded, and another three expenditures were selected totaling to $17,060. There were no additional compliance deviations noted. This is a condition identified per review of the City’s compliance with specified requirements using a sample that was not statistically valid. Identification as a Repeat Finding: N/A Recommendation: HOST should improve existing review controls to ensure Emergency Solutions Grant Program annual grants expiring are monitored to ensure expenditures are not charged to grants outside of the 24-month period. Grants should be monitored, and prior to grant expiration, special instructions should be distributed to personnel reviewing expenses informing them of the grant cutoff and items potentially charged outside of the period of performance. Views of Responsible Officials: The City agrees with the finding. The Division of Operations and Impact has established policies and procedures that seek to ensure internal controls are in place to ensure that eligible expenditures are within a grant’s period of performance. For additional information, see the City’s separate report for planned corrective actions.
ACTIVITIES ALLOWED OR UNALLOWED AND ALLOWABLE COSTS/COST PRINCIPLES Significant Deficiency in Internal Control Over Compliance and Noncompliance ALN 93.391 – Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcare Crises Department of Health and Human Services Award Number: NH75OT0000010 Award Year: 2021 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. The Uniform Guidance in 2 CFR Section 200.403(g) states that for costs to be allowable under Federal awards, they must be adequately documented. Condition: Controls in place at the City’s Department of Public Health and Environment (DDPHE) were not effective in preventing incorrect expenditures from being charged to the grant. There was one instance where the existence of a control failed to detect an error within an invoice selected, which resulted in an overpayment to the subrecipient. Cause: Personnel reviewing expenditures did not adequately review to ensure invoices were correct prior to payment. Effect or Potential Effect: An invoice to a subrecipient was overpaid. Questioned Costs: $431 Context: BDO selected a sample of 20 expenditures totaling to $216,560 from a population of 162 expenditures totaling to $625,782. There was one expenditure in the amount of $4,101 that was overpaid. The compliance sample was expanded, and another 12 expenditures were selected totaling to $29,975. There were no additional compliance deviations noted. This is a condition identified per review of the City’s compliance with specified requirements using a sample that was not statistically valid. Identification as a Repeat Finding: N/A Recommendation: DDPHE should improve existing review controls to ensure the mathematical accuracy of invoices has been checked, especially with respect to payments to subrecipients. Payroll and other costs reported on the face of the invoice should agree to supporting payroll documentation received. Views of Responsible Officials: The City agrees with the finding. DDPHE will implement additional trainings and is encouraging a standard template in Excel to avoid calculation errors. For additional information, see the City’s separate report for planned corrective actions.
REPORTING Significant Deficiency in Internal Control Over Compliance and Noncompliance ALN 21.023 – Emergency Rental Assistance Program Department of the Treasury Award Number: ERAE0436; ERAE0437 Award Year: 2021 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. ERA Reporting Guidance v 3.4 identifies quarterly reports required to be submitted for the Emergency Rental Assistance Program (ERAP). Key line items for these reports are outlined within the Compliance Supplement and include (1) administrative costs ratio, (2) housing stability services ratio, (3) system for prioritizing assistance, and (4) participant households at certain income levels of eligibility. Condition: Controls over reviews of quarterly reports in place at the City’s Department of Housing Stability (HOST) were not effective in detecting an error in expenditures reported on a quarterly report. Cause: The Department’s supervisory and review control was not operating effectively to ensure that all key line items reported in the quarterly reports were properly supported. Effect or Potential Effect: The quarterly report for the fourth quarter contained an error pertaining to total expenditures. Ineffective controls could result in ratios such as the administrative costs and housing stability services to be incorrect. Questioned Costs: Not applicable Context: We tested a sample of three reports from a population of four. We identified exceptions in one of the reports tested. The exception was as follows:  ERA2 Quarter 4 Report- Total expenditures reported for the period differed from what was reported on HOST supporting spreadsheets. This difference was between housing stability services expenditures, which were reported as $52,154 as opposed to $40,484, which was a difference of $11,659. This is a condition identified per review of the City’s compliance with specified requirements using a sample that was not statistically valid. Identification as a Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2022-011 in the 2022 report. Recommendation: Reviews of reports should be more thorough, which will increase the probability that such reporting errors are detected. The reviews can be improved by implementing a reporting checklist, which contains steps outlined in reviewing a report, including determining whether the report is mathematically accurate and agrees to underlying documentation. Underlying documentation should also be reviewed to determine if any errors exist within that documentation that could cause errors within the report. Views of Responsible Officials: The City disagrees with the finding. Review of the ERA2 administration costs did not consider the timing of the static report submission. The report was prior to monthly close/reconciliation, which occurred the following month. For additional information, see the City’s separate report for planned corrective actions.
REPORTING Material Weakness in Internal Control Over Compliance and Noncompliance ALN 93.600 – Head Start Program Administration for Children and Families Award Number: 08CH010552; 08HE000797 Award Year: 2021; 2022; 2023 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. The Federal Funding Accountability and Transparency Act (FFATA), codified under 2 CFR Part 170, requires recipients of grants or cooperative agreements to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Recipients must report each first-tier subaward or subaward amendment that results in an obligation of $30,000 or more in Federal funds. These actions must be reported in FSRS no later than the last day of the month following the month in which the subaward/subaward amendment obligation was made. Condition: Testing of FFATA reporting indicated all reports submitted had the incorrect obligation amounts reported. Reports to FSRS were also not submitted timely and in some cases no report was submitted. Cause: Personnel administering the grant had an incorrect understanding of the reporting requirements under FFATA. Effect or Potential Effect: The Federal government is not receiving accurate and up to date information on subawards and changes in subaward obligations made to first-tier subrecipients by the City. Questioned Costs: Not applicable Context: BDO selected a sample of three subrecipients with nine contracts and related amendments totaling to $16,650,842. There were nine instances of noncompliance in which the obligations/modifications totaling $16,650,842 were either not reported or reported incorrectly. There were three instances of noncompliance in which required key data elements for contracts totaling $958,676 were not reported or were reported incorrectly. There were nine instances of noncompliance where the reporting to FSRS was not submitted timely. This is a condition identified per review of the City’s compliance with specified requirements using a sample that was not statistically valid. Identification as a Repeat Finding: N/A Recommendation: An understanding of FFATA reporting requirements should be obtained through training and continuing education. This will enable more effective controls to be implemented to ensure such reporting requirements are followed. Views of Responsible Officials: The City agrees with the finding. The department is updating internal procedures for reporting for FFATA amounts in the period of obligation rather than when the expense was incurred. For additional information, see the City’s separate report for planned corrective actions.
REPORTING Material Weakness in Internal Control Over Compliance and Noncompliance ALN 93.600 – Head Start Program Administration for Children and Families Award Number: 08CH010552; 08HE000797 Award Year: 2021; 2022; 2023 Criteria or Specific Requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. The Federal Funding Accountability and Transparency Act (FFATA), codified under 2 CFR Part 170, requires recipients of grants or cooperative agreements to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Recipients must report each first-tier subaward or subaward amendment that results in an obligation of $30,000 or more in Federal funds. These actions must be reported in FSRS no later than the last day of the month following the month in which the subaward/subaward amendment obligation was made. Condition: Testing of FFATA reporting indicated all reports submitted had the incorrect obligation amounts reported. Reports to FSRS were also not submitted timely and in some cases no report was submitted. Cause: Personnel administering the grant had an incorrect understanding of the reporting requirements under FFATA. Effect or Potential Effect: The Federal government is not receiving accurate and up to date information on subawards and changes in subaward obligations made to first-tier subrecipients by the City. Questioned Costs: Not applicable Context: BDO selected a sample of three subrecipients with nine contracts and related amendments totaling to $16,650,842. There were nine instances of noncompliance in which the obligations/modifications totaling $16,650,842 were either not reported or reported incorrectly. There were three instances of noncompliance in which required key data elements for contracts totaling $958,676 were not reported or were reported incorrectly. There were nine instances of noncompliance where the reporting to FSRS was not submitted timely. This is a condition identified per review of the City’s compliance with specified requirements using a sample that was not statistically valid. Identification as a Repeat Finding: N/A Recommendation: An understanding of FFATA reporting requirements should be obtained through training and continuing education. This will enable more effective controls to be implemented to ensure such reporting requirements are followed. Views of Responsible Officials: The City agrees with the finding. The department is updating internal procedures for reporting for FFATA amounts in the period of obligation rather than when the expense was incurred. For additional information, see the City’s separate report for planned corrective actions.