Audit 323585

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditing standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit 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), require auditors to obtain sufficient and appropriate audit evidence needed to perform the audit. Condition: The City of York was not able to provide sufficient and appropriate audit evidence for balances and disclosures reported in the SEFA. Cause: Due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Effect or Potential Effect: The inability to appropriately support balances and disclosures leaves the City unable to verify whether any adjustments may be necessary. This impact is material. Context: Support for virtually all balances and disclosures was not able to be provided to verify balances and disclosures reported in the City’s SEFA Recommendation: We recommend that the City retains all support for transactions and account balances as well as performs reconciliations at month and year ends to verify if any adjustments are necessary.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditee responsibilities as outlined in section 2 CFR 200.508 include providing the auditor with access to personnel, accounts, books, records, supporting documentation, and other information as needed for the auditor to perform the audit. Condition: Supporting documentation related to the major program was not provided to the auditor due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Cause: Management determined sufficient information could not be provided to satisfy the audit requirements. Effect: Noncompliance with federal regulations can result in the federal government imposing additional requirements or withholding, disallowing or suspending grant funding. Context: Audit evidence for direct and material compliance requirements related to the major program noted above was not provided. This included the corresponding grant agreements for the five awards under this program listed on the SEFA. Recommendation: Program directors and administrators should work together to ensure supporting documentation for federal awards is appropriately maintained.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.302 of the Uniform Guidance states that the financial management system must provide for identification, in its accounts, of all federal awards received and expended and the federal programs under which they were received. federal program and federal award identification must include, as applicable, the AL title and number, federal award identification and year, name of the federal agency, and the name of the pass-through entity, if any. Condition: The City does not have policies and procedures in place to accurately and completely account for federally funded activities separately from non-federally funded activities in their financial management system. Cause: Inaccurate accounting of grant expenditures in the City’s financial management system. Effect: The City did not consistently segregate and identify federal grant expenditures separately from their nonfederal expenditures. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to accurately account for federally funded activities separately from non-federally funded activities in their financial management system. Recommendation: We recommend the City implement procedures to ensure consistent and accurate accounting for federal grant expenditures in accordance with section 2 CFR 200.302 of the Uniform Guidance.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.331 of the Uniform Guidance states that pass-thru entities must evaluate each subrecipient's risk of noncompliance with federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. This evaluation may include, but is not limited to, (1) The subrecipient's prior experience with the same or similar subawards; (2) The results of previous audits including whether or not the subrecipient receives a single audit and the extent to which the same or similar subaward has been audited as a major program; and (3) Whether the subrecipient has new personnel or new or substantially changed systems. Based on the results of the evaluation, the City would then have to consider the extent to which monitoring procedures are required. At a minimum, the City must, (1) Review financial and performance reports required by the City, (2) Follow-up and ensure that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the City detected through audits, on-site reviews, and other means, and (3) Issue a management decision for audit findings pertaining to the federal award provided to the subrecipient from the City as required by Section 200.521 of the Uniform Guidance. Additionally, the City must perform monitoring visits as stipulated in the contracts between the City and the subrecipients. Condition: The City does not have policies and procedures in place to perform the required risk assessment of subrecipients to determine the extent of monitoring procedures, and then perform and document the monitoring procedures performed. Cause: There is no documentation of any subrecipient risk assessment being performed for grants provided to subrecipients for 2019, and only partial documentation of any subrecipient monitoring procedures being performed. Effect: Subrecipient monitoring procedures were not properly performed and documented by the City. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to perform risk assessment of subrecipients, in order to determine the extent of monitoring procedures and performance of the monitoring procedures themselves. Recommendation: We recommend the City implement procedures to ensure risk assessment of subrecipients prior to each subaward is performed in accordance with the Uniform Guidance requirements and thoroughly documented. We further recommend that the required subrecipient monitoring be performed and documented for each subaward.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditing standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit 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), require auditors to obtain sufficient and appropriate audit evidence needed to perform the audit. Condition: The City of York was not able to provide sufficient and appropriate audit evidence for balances and disclosures reported in the SEFA. Cause: Due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Effect or Potential Effect: The inability to appropriately support balances and disclosures leaves the City unable to verify whether any adjustments may be necessary. This impact is material. Context: Support for virtually all balances and disclosures was not able to be provided to verify balances and disclosures reported in the City’s SEFA Recommendation: We recommend that the City retains all support for transactions and account balances as well as performs reconciliations at month and year ends to verify if any adjustments are necessary.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditee responsibilities as outlined in section 2 CFR 200.508 include providing the auditor with access to personnel, accounts, books, records, supporting documentation, and other information as needed for the auditor to perform the audit. Condition: Supporting documentation related to the major program was not provided to the auditor due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Cause: Management determined sufficient information could not be provided to satisfy the audit requirements. Effect: Noncompliance with federal regulations can result in the federal government imposing additional requirements or withholding, disallowing or suspending grant funding. Context: Audit evidence for direct and material compliance requirements related to the major program noted above was not provided. This included the corresponding grant agreements for the five awards under this program listed on the SEFA. Recommendation: Program directors and administrators should work together to ensure supporting documentation for federal awards is appropriately maintained.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.302 of the Uniform Guidance states that the financial management system must provide for identification, in its accounts, of all federal awards received and expended and the federal programs under which they were received. federal program and federal award identification must include, as applicable, the AL title and number, federal award identification and year, name of the federal agency, and the name of the pass-through entity, if any. Condition: The City does not have policies and procedures in place to accurately and completely account for federally funded activities separately from non-federally funded activities in their financial management system. Cause: Inaccurate accounting of grant expenditures in the City’s financial management system. Effect: The City did not consistently segregate and identify federal grant expenditures separately from their nonfederal expenditures. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to accurately account for federally funded activities separately from non-federally funded activities in their financial management system. Recommendation: We recommend the City implement procedures to ensure consistent and accurate accounting for federal grant expenditures in accordance with section 2 CFR 200.302 of the Uniform Guidance.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.331 of the Uniform Guidance states that pass-thru entities must evaluate each subrecipient's risk of noncompliance with federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. This evaluation may include, but is not limited to, (1) The subrecipient's prior experience with the same or similar subawards; (2) The results of previous audits including whether or not the subrecipient receives a single audit and the extent to which the same or similar subaward has been audited as a major program; and (3) Whether the subrecipient has new personnel or new or substantially changed systems. Based on the results of the evaluation, the City would then have to consider the extent to which monitoring procedures are required. At a minimum, the City must, (1) Review financial and performance reports required by the City, (2) Follow-up and ensure that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the City detected through audits, on-site reviews, and other means, and (3) Issue a management decision for audit findings pertaining to the federal award provided to the subrecipient from the City as required by Section 200.521 of the Uniform Guidance. Additionally, the City must perform monitoring visits as stipulated in the contracts between the City and the subrecipients. Condition: The City does not have policies and procedures in place to perform the required risk assessment of subrecipients to determine the extent of monitoring procedures, and then perform and document the monitoring procedures performed. Cause: There is no documentation of any subrecipient risk assessment being performed for grants provided to subrecipients for 2019, and only partial documentation of any subrecipient monitoring procedures being performed. Effect: Subrecipient monitoring procedures were not properly performed and documented by the City. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to perform risk assessment of subrecipients, in order to determine the extent of monitoring procedures and performance of the monitoring procedures themselves. Recommendation: We recommend the City implement procedures to ensure risk assessment of subrecipients prior to each subaward is performed in accordance with the Uniform Guidance requirements and thoroughly documented. We further recommend that the required subrecipient monitoring be performed and documented for each subaward.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditing standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit 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), require auditors to obtain sufficient and appropriate audit evidence needed to perform the audit. Condition: The City of York was not able to provide sufficient and appropriate audit evidence for balances and disclosures reported in the SEFA. Cause: Due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Effect or Potential Effect: The inability to appropriately support balances and disclosures leaves the City unable to verify whether any adjustments may be necessary. This impact is material. Context: Support for virtually all balances and disclosures was not able to be provided to verify balances and disclosures reported in the City’s SEFA Recommendation: We recommend that the City retains all support for transactions and account balances as well as performs reconciliations at month and year ends to verify if any adjustments are necessary.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditee responsibilities as outlined in section 2 CFR 200.508 include providing the auditor with access to personnel, accounts, books, records, supporting documentation, and other information as needed for the auditor to perform the audit. Condition: Supporting documentation related to the major program was not provided to the auditor due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Cause: Management determined sufficient information could not be provided to satisfy the audit requirements. Effect: Noncompliance with federal regulations can result in the federal government imposing additional requirements or withholding, disallowing or suspending grant funding. Context: Audit evidence for direct and material compliance requirements related to the major program noted above was not provided. This included the corresponding grant agreements for the five awards under this program listed on the SEFA. Recommendation: Program directors and administrators should work together to ensure supporting documentation for federal awards is appropriately maintained.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.302 of the Uniform Guidance states that the financial management system must provide for identification, in its accounts, of all federal awards received and expended and the federal programs under which they were received. federal program and federal award identification must include, as applicable, the AL title and number, federal award identification and year, name of the federal agency, and the name of the pass-through entity, if any. Condition: The City does not have policies and procedures in place to accurately and completely account for federally funded activities separately from non-federally funded activities in their financial management system. Cause: Inaccurate accounting of grant expenditures in the City’s financial management system. Effect: The City did not consistently segregate and identify federal grant expenditures separately from their nonfederal expenditures. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to accurately account for federally funded activities separately from non-federally funded activities in their financial management system. Recommendation: We recommend the City implement procedures to ensure consistent and accurate accounting for federal grant expenditures in accordance with section 2 CFR 200.302 of the Uniform Guidance.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.331 of the Uniform Guidance states that pass-thru entities must evaluate each subrecipient's risk of noncompliance with federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. This evaluation may include, but is not limited to, (1) The subrecipient's prior experience with the same or similar subawards; (2) The results of previous audits including whether or not the subrecipient receives a single audit and the extent to which the same or similar subaward has been audited as a major program; and (3) Whether the subrecipient has new personnel or new or substantially changed systems. Based on the results of the evaluation, the City would then have to consider the extent to which monitoring procedures are required. At a minimum, the City must, (1) Review financial and performance reports required by the City, (2) Follow-up and ensure that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the City detected through audits, on-site reviews, and other means, and (3) Issue a management decision for audit findings pertaining to the federal award provided to the subrecipient from the City as required by Section 200.521 of the Uniform Guidance. Additionally, the City must perform monitoring visits as stipulated in the contracts between the City and the subrecipients. Condition: The City does not have policies and procedures in place to perform the required risk assessment of subrecipients to determine the extent of monitoring procedures, and then perform and document the monitoring procedures performed. Cause: There is no documentation of any subrecipient risk assessment being performed for grants provided to subrecipients for 2019, and only partial documentation of any subrecipient monitoring procedures being performed. Effect: Subrecipient monitoring procedures were not properly performed and documented by the City. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to perform risk assessment of subrecipients, in order to determine the extent of monitoring procedures and performance of the monitoring procedures themselves. Recommendation: We recommend the City implement procedures to ensure risk assessment of subrecipients prior to each subaward is performed in accordance with the Uniform Guidance requirements and thoroughly documented. We further recommend that the required subrecipient monitoring be performed and documented for each subaward.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditing standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit 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), require auditors to obtain sufficient and appropriate audit evidence needed to perform the audit. Condition: The City of York was not able to provide sufficient and appropriate audit evidence for balances and disclosures reported in the SEFA. Cause: Due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Effect or Potential Effect: The inability to appropriately support balances and disclosures leaves the City unable to verify whether any adjustments may be necessary. This impact is material. Context: Support for virtually all balances and disclosures was not able to be provided to verify balances and disclosures reported in the City’s SEFA Recommendation: We recommend that the City retains all support for transactions and account balances as well as performs reconciliations at month and year ends to verify if any adjustments are necessary.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditee responsibilities as outlined in section 2 CFR 200.508 include providing the auditor with access to personnel, accounts, books, records, supporting documentation, and other information as needed for the auditor to perform the audit. Condition: Supporting documentation related to the major program was not provided to the auditor due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Cause: Management determined sufficient information could not be provided to satisfy the audit requirements. Effect: Noncompliance with federal regulations can result in the federal government imposing additional requirements or withholding, disallowing or suspending grant funding. Context: Audit evidence for direct and material compliance requirements related to the major program noted above was not provided. This included the corresponding grant agreements for the five awards under this program listed on the SEFA. Recommendation: Program directors and administrators should work together to ensure supporting documentation for federal awards is appropriately maintained.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.302 of the Uniform Guidance states that the financial management system must provide for identification, in its accounts, of all federal awards received and expended and the federal programs under which they were received. federal program and federal award identification must include, as applicable, the AL title and number, federal award identification and year, name of the federal agency, and the name of the pass-through entity, if any. Condition: The City does not have policies and procedures in place to accurately and completely account for federally funded activities separately from non-federally funded activities in their financial management system. Cause: Inaccurate accounting of grant expenditures in the City’s financial management system. Effect: The City did not consistently segregate and identify federal grant expenditures separately from their nonfederal expenditures. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to accurately account for federally funded activities separately from non-federally funded activities in their financial management system. Recommendation: We recommend the City implement procedures to ensure consistent and accurate accounting for federal grant expenditures in accordance with section 2 CFR 200.302 of the Uniform Guidance.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.331 of the Uniform Guidance states that pass-thru entities must evaluate each subrecipient's risk of noncompliance with federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. This evaluation may include, but is not limited to, (1) The subrecipient's prior experience with the same or similar subawards; (2) The results of previous audits including whether or not the subrecipient receives a single audit and the extent to which the same or similar subaward has been audited as a major program; and (3) Whether the subrecipient has new personnel or new or substantially changed systems. Based on the results of the evaluation, the City would then have to consider the extent to which monitoring procedures are required. At a minimum, the City must, (1) Review financial and performance reports required by the City, (2) Follow-up and ensure that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the City detected through audits, on-site reviews, and other means, and (3) Issue a management decision for audit findings pertaining to the federal award provided to the subrecipient from the City as required by Section 200.521 of the Uniform Guidance. Additionally, the City must perform monitoring visits as stipulated in the contracts between the City and the subrecipients. Condition: The City does not have policies and procedures in place to perform the required risk assessment of subrecipients to determine the extent of monitoring procedures, and then perform and document the monitoring procedures performed. Cause: There is no documentation of any subrecipient risk assessment being performed for grants provided to subrecipients for 2019, and only partial documentation of any subrecipient monitoring procedures being performed. Effect: Subrecipient monitoring procedures were not properly performed and documented by the City. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to perform risk assessment of subrecipients, in order to determine the extent of monitoring procedures and performance of the monitoring procedures themselves. Recommendation: We recommend the City implement procedures to ensure risk assessment of subrecipients prior to each subaward is performed in accordance with the Uniform Guidance requirements and thoroughly documented. We further recommend that the required subrecipient monitoring be performed and documented for each subaward.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditing standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit 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), require auditors to obtain sufficient and appropriate audit evidence needed to perform the audit. Condition: The City of York was not able to provide sufficient and appropriate audit evidence for balances and disclosures reported in the SEFA. Cause: Due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Effect or Potential Effect: The inability to appropriately support balances and disclosures leaves the City unable to verify whether any adjustments may be necessary. This impact is material. Context: Support for virtually all balances and disclosures was not able to be provided to verify balances and disclosures reported in the City’s SEFA Recommendation: We recommend that the City retains all support for transactions and account balances as well as performs reconciliations at month and year ends to verify if any adjustments are necessary.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditee responsibilities as outlined in section 2 CFR 200.508 include providing the auditor with access to personnel, accounts, books, records, supporting documentation, and other information as needed for the auditor to perform the audit. Condition: Supporting documentation related to the major program was not provided to the auditor due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Cause: Management determined sufficient information could not be provided to satisfy the audit requirements. Effect: Noncompliance with federal regulations can result in the federal government imposing additional requirements or withholding, disallowing or suspending grant funding. Context: Audit evidence for direct and material compliance requirements related to the major program noted above was not provided. This included the corresponding grant agreements for the five awards under this program listed on the SEFA. Recommendation: Program directors and administrators should work together to ensure supporting documentation for federal awards is appropriately maintained.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.302 of the Uniform Guidance states that the financial management system must provide for identification, in its accounts, of all federal awards received and expended and the federal programs under which they were received. federal program and federal award identification must include, as applicable, the AL title and number, federal award identification and year, name of the federal agency, and the name of the pass-through entity, if any. Condition: The City does not have policies and procedures in place to accurately and completely account for federally funded activities separately from non-federally funded activities in their financial management system. Cause: Inaccurate accounting of grant expenditures in the City’s financial management system. Effect: The City did not consistently segregate and identify federal grant expenditures separately from their nonfederal expenditures. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to accurately account for federally funded activities separately from non-federally funded activities in their financial management system. Recommendation: We recommend the City implement procedures to ensure consistent and accurate accounting for federal grant expenditures in accordance with section 2 CFR 200.302 of the Uniform Guidance.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.331 of the Uniform Guidance states that pass-thru entities must evaluate each subrecipient's risk of noncompliance with federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. This evaluation may include, but is not limited to, (1) The subrecipient's prior experience with the same or similar subawards; (2) The results of previous audits including whether or not the subrecipient receives a single audit and the extent to which the same or similar subaward has been audited as a major program; and (3) Whether the subrecipient has new personnel or new or substantially changed systems. Based on the results of the evaluation, the City would then have to consider the extent to which monitoring procedures are required. At a minimum, the City must, (1) Review financial and performance reports required by the City, (2) Follow-up and ensure that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the City detected through audits, on-site reviews, and other means, and (3) Issue a management decision for audit findings pertaining to the federal award provided to the subrecipient from the City as required by Section 200.521 of the Uniform Guidance. Additionally, the City must perform monitoring visits as stipulated in the contracts between the City and the subrecipients. Condition: The City does not have policies and procedures in place to perform the required risk assessment of subrecipients to determine the extent of monitoring procedures, and then perform and document the monitoring procedures performed. Cause: There is no documentation of any subrecipient risk assessment being performed for grants provided to subrecipients for 2019, and only partial documentation of any subrecipient monitoring procedures being performed. Effect: Subrecipient monitoring procedures were not properly performed and documented by the City. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to perform risk assessment of subrecipients, in order to determine the extent of monitoring procedures and performance of the monitoring procedures themselves. Recommendation: We recommend the City implement procedures to ensure risk assessment of subrecipients prior to each subaward is performed in accordance with the Uniform Guidance requirements and thoroughly documented. We further recommend that the required subrecipient monitoring be performed and documented for each subaward.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditing standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit 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), require auditors to obtain sufficient and appropriate audit evidence needed to perform the audit. Condition: The City of York was not able to provide sufficient and appropriate audit evidence for balances and disclosures reported in the SEFA. Cause: Due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Effect or Potential Effect: The inability to appropriately support balances and disclosures leaves the City unable to verify whether any adjustments may be necessary. This impact is material. Context: Support for virtually all balances and disclosures was not able to be provided to verify balances and disclosures reported in the City’s SEFA Recommendation: We recommend that the City retains all support for transactions and account balances as well as performs reconciliations at month and year ends to verify if any adjustments are necessary.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditee responsibilities as outlined in section 2 CFR 200.508 include providing the auditor with access to personnel, accounts, books, records, supporting documentation, and other information as needed for the auditor to perform the audit. Condition: Supporting documentation related to the major program was not provided to the auditor due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Cause: Management determined sufficient information could not be provided to satisfy the audit requirements. Effect: Noncompliance with federal regulations can result in the federal government imposing additional requirements or withholding, disallowing or suspending grant funding. Context: Audit evidence for direct and material compliance requirements related to the major program noted above was not provided. This included the corresponding grant agreements for the five awards under this program listed on the SEFA. Recommendation: Program directors and administrators should work together to ensure supporting documentation for federal awards is appropriately maintained.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.302 of the Uniform Guidance states that the financial management system must provide for identification, in its accounts, of all federal awards received and expended and the federal programs under which they were received. federal program and federal award identification must include, as applicable, the AL title and number, federal award identification and year, name of the federal agency, and the name of the pass-through entity, if any. Condition: The City does not have policies and procedures in place to accurately and completely account for federally funded activities separately from non-federally funded activities in their financial management system. Cause: Inaccurate accounting of grant expenditures in the City’s financial management system. Effect: The City did not consistently segregate and identify federal grant expenditures separately from their nonfederal expenditures. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to accurately account for federally funded activities separately from non-federally funded activities in their financial management system. Recommendation: We recommend the City implement procedures to ensure consistent and accurate accounting for federal grant expenditures in accordance with section 2 CFR 200.302 of the Uniform Guidance.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.331 of the Uniform Guidance states that pass-thru entities must evaluate each subrecipient's risk of noncompliance with federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. This evaluation may include, but is not limited to, (1) The subrecipient's prior experience with the same or similar subawards; (2) The results of previous audits including whether or not the subrecipient receives a single audit and the extent to which the same or similar subaward has been audited as a major program; and (3) Whether the subrecipient has new personnel or new or substantially changed systems. Based on the results of the evaluation, the City would then have to consider the extent to which monitoring procedures are required. At a minimum, the City must, (1) Review financial and performance reports required by the City, (2) Follow-up and ensure that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the City detected through audits, on-site reviews, and other means, and (3) Issue a management decision for audit findings pertaining to the federal award provided to the subrecipient from the City as required by Section 200.521 of the Uniform Guidance. Additionally, the City must perform monitoring visits as stipulated in the contracts between the City and the subrecipients. Condition: The City does not have policies and procedures in place to perform the required risk assessment of subrecipients to determine the extent of monitoring procedures, and then perform and document the monitoring procedures performed. Cause: There is no documentation of any subrecipient risk assessment being performed for grants provided to subrecipients for 2019, and only partial documentation of any subrecipient monitoring procedures being performed. Effect: Subrecipient monitoring procedures were not properly performed and documented by the City. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to perform risk assessment of subrecipients, in order to determine the extent of monitoring procedures and performance of the monitoring procedures themselves. Recommendation: We recommend the City implement procedures to ensure risk assessment of subrecipients prior to each subaward is performed in accordance with the Uniform Guidance requirements and thoroughly documented. We further recommend that the required subrecipient monitoring be performed and documented for each subaward.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditing standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit 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), require auditors to obtain sufficient and appropriate audit evidence needed to perform the audit. Condition: The City of York was not able to provide sufficient and appropriate audit evidence for balances and disclosures reported in the SEFA. Cause: Due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Effect or Potential Effect: The inability to appropriately support balances and disclosures leaves the City unable to verify whether any adjustments may be necessary. This impact is material. Context: Support for virtually all balances and disclosures was not able to be provided to verify balances and disclosures reported in the City’s SEFA Recommendation: We recommend that the City retains all support for transactions and account balances as well as performs reconciliations at month and year ends to verify if any adjustments are necessary.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditee responsibilities as outlined in section 2 CFR 200.508 include providing the auditor with access to personnel, accounts, books, records, supporting documentation, and other information as needed for the auditor to perform the audit. Condition: Supporting documentation related to the major program was not provided to the auditor due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Cause: Management determined sufficient information could not be provided to satisfy the audit requirements. Effect: Noncompliance with federal regulations can result in the federal government imposing additional requirements or withholding, disallowing or suspending grant funding. Context: Audit evidence for direct and material compliance requirements related to the major program noted above was not provided. This included the corresponding grant agreements for the five awards under this program listed on the SEFA. Recommendation: Program directors and administrators should work together to ensure supporting documentation for federal awards is appropriately maintained.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.302 of the Uniform Guidance states that the financial management system must provide for identification, in its accounts, of all federal awards received and expended and the federal programs under which they were received. federal program and federal award identification must include, as applicable, the AL title and number, federal award identification and year, name of the federal agency, and the name of the pass-through entity, if any. Condition: The City does not have policies and procedures in place to accurately and completely account for federally funded activities separately from non-federally funded activities in their financial management system. Cause: Inaccurate accounting of grant expenditures in the City’s financial management system. Effect: The City did not consistently segregate and identify federal grant expenditures separately from their nonfederal expenditures. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to accurately account for federally funded activities separately from non-federally funded activities in their financial management system. Recommendation: We recommend the City implement procedures to ensure consistent and accurate accounting for federal grant expenditures in accordance with section 2 CFR 200.302 of the Uniform Guidance.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.331 of the Uniform Guidance states that pass-thru entities must evaluate each subrecipient's risk of noncompliance with federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. This evaluation may include, but is not limited to, (1) The subrecipient's prior experience with the same or similar subawards; (2) The results of previous audits including whether or not the subrecipient receives a single audit and the extent to which the same or similar subaward has been audited as a major program; and (3) Whether the subrecipient has new personnel or new or substantially changed systems. Based on the results of the evaluation, the City would then have to consider the extent to which monitoring procedures are required. At a minimum, the City must, (1) Review financial and performance reports required by the City, (2) Follow-up and ensure that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the City detected through audits, on-site reviews, and other means, and (3) Issue a management decision for audit findings pertaining to the federal award provided to the subrecipient from the City as required by Section 200.521 of the Uniform Guidance. Additionally, the City must perform monitoring visits as stipulated in the contracts between the City and the subrecipients. Condition: The City does not have policies and procedures in place to perform the required risk assessment of subrecipients to determine the extent of monitoring procedures, and then perform and document the monitoring procedures performed. Cause: There is no documentation of any subrecipient risk assessment being performed for grants provided to subrecipients for 2019, and only partial documentation of any subrecipient monitoring procedures being performed. Effect: Subrecipient monitoring procedures were not properly performed and documented by the City. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to perform risk assessment of subrecipients, in order to determine the extent of monitoring procedures and performance of the monitoring procedures themselves. Recommendation: We recommend the City implement procedures to ensure risk assessment of subrecipients prior to each subaward is performed in accordance with the Uniform Guidance requirements and thoroughly documented. We further recommend that the required subrecipient monitoring be performed and documented for each subaward.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditing standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit 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), require auditors to obtain sufficient and appropriate audit evidence needed to perform the audit. Condition: The City of York was not able to provide sufficient and appropriate audit evidence for balances and disclosures reported in the SEFA. Cause: Due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Effect or Potential Effect: The inability to appropriately support balances and disclosures leaves the City unable to verify whether any adjustments may be necessary. This impact is material. Context: Support for virtually all balances and disclosures was not able to be provided to verify balances and disclosures reported in the City’s SEFA Recommendation: We recommend that the City retains all support for transactions and account balances as well as performs reconciliations at month and year ends to verify if any adjustments are necessary.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditee responsibilities as outlined in section 2 CFR 200.508 include providing the auditor with access to personnel, accounts, books, records, supporting documentation, and other information as needed for the auditor to perform the audit. Condition: Supporting documentation related to the major program was not provided to the auditor due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Cause: Management determined sufficient information could not be provided to satisfy the audit requirements. Effect: Noncompliance with federal regulations can result in the federal government imposing additional requirements or withholding, disallowing or suspending grant funding. Context: Audit evidence for direct and material compliance requirements related to the major program noted above was not provided. This included the corresponding grant agreements for the five awards under this program listed on the SEFA. Recommendation: Program directors and administrators should work together to ensure supporting documentation for federal awards is appropriately maintained.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.302 of the Uniform Guidance states that the financial management system must provide for identification, in its accounts, of all federal awards received and expended and the federal programs under which they were received. federal program and federal award identification must include, as applicable, the AL title and number, federal award identification and year, name of the federal agency, and the name of the pass-through entity, if any. Condition: The City does not have policies and procedures in place to accurately and completely account for federally funded activities separately from non-federally funded activities in their financial management system. Cause: Inaccurate accounting of grant expenditures in the City’s financial management system. Effect: The City did not consistently segregate and identify federal grant expenditures separately from their nonfederal expenditures. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to accurately account for federally funded activities separately from non-federally funded activities in their financial management system. Recommendation: We recommend the City implement procedures to ensure consistent and accurate accounting for federal grant expenditures in accordance with section 2 CFR 200.302 of the Uniform Guidance.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.331 of the Uniform Guidance states that pass-thru entities must evaluate each subrecipient's risk of noncompliance with federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. This evaluation may include, but is not limited to, (1) The subrecipient's prior experience with the same or similar subawards; (2) The results of previous audits including whether or not the subrecipient receives a single audit and the extent to which the same or similar subaward has been audited as a major program; and (3) Whether the subrecipient has new personnel or new or substantially changed systems. Based on the results of the evaluation, the City would then have to consider the extent to which monitoring procedures are required. At a minimum, the City must, (1) Review financial and performance reports required by the City, (2) Follow-up and ensure that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the City detected through audits, on-site reviews, and other means, and (3) Issue a management decision for audit findings pertaining to the federal award provided to the subrecipient from the City as required by Section 200.521 of the Uniform Guidance. Additionally, the City must perform monitoring visits as stipulated in the contracts between the City and the subrecipients. Condition: The City does not have policies and procedures in place to perform the required risk assessment of subrecipients to determine the extent of monitoring procedures, and then perform and document the monitoring procedures performed. Cause: There is no documentation of any subrecipient risk assessment being performed for grants provided to subrecipients for 2019, and only partial documentation of any subrecipient monitoring procedures being performed. Effect: Subrecipient monitoring procedures were not properly performed and documented by the City. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to perform risk assessment of subrecipients, in order to determine the extent of monitoring procedures and performance of the monitoring procedures themselves. Recommendation: We recommend the City implement procedures to ensure risk assessment of subrecipients prior to each subaward is performed in accordance with the Uniform Guidance requirements and thoroughly documented. We further recommend that the required subrecipient monitoring be performed and documented for each subaward.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditing standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit 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), require auditors to obtain sufficient and appropriate audit evidence needed to perform the audit. Condition: The City of York was not able to provide sufficient and appropriate audit evidence for balances and disclosures reported in the SEFA. Cause: Due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Effect or Potential Effect: The inability to appropriately support balances and disclosures leaves the City unable to verify whether any adjustments may be necessary. This impact is material. Context: Support for virtually all balances and disclosures was not able to be provided to verify balances and disclosures reported in the City’s SEFA Recommendation: We recommend that the City retains all support for transactions and account balances as well as performs reconciliations at month and year ends to verify if any adjustments are necessary.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditee responsibilities as outlined in section 2 CFR 200.508 include providing the auditor with access to personnel, accounts, books, records, supporting documentation, and other information as needed for the auditor to perform the audit. Condition: Supporting documentation related to the major program was not provided to the auditor due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Cause: Management determined sufficient information could not be provided to satisfy the audit requirements. Effect: Noncompliance with federal regulations can result in the federal government imposing additional requirements or withholding, disallowing or suspending grant funding. Context: Audit evidence for direct and material compliance requirements related to the major program noted above was not provided. This included the corresponding grant agreements for the five awards under this program listed on the SEFA. Recommendation: Program directors and administrators should work together to ensure supporting documentation for federal awards is appropriately maintained.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.302 of the Uniform Guidance states that the financial management system must provide for identification, in its accounts, of all federal awards received and expended and the federal programs under which they were received. federal program and federal award identification must include, as applicable, the AL title and number, federal award identification and year, name of the federal agency, and the name of the pass-through entity, if any. Condition: The City does not have policies and procedures in place to accurately and completely account for federally funded activities separately from non-federally funded activities in their financial management system. Cause: Inaccurate accounting of grant expenditures in the City’s financial management system. Effect: The City did not consistently segregate and identify federal grant expenditures separately from their nonfederal expenditures. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to accurately account for federally funded activities separately from non-federally funded activities in their financial management system. Recommendation: We recommend the City implement procedures to ensure consistent and accurate accounting for federal grant expenditures in accordance with section 2 CFR 200.302 of the Uniform Guidance.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.331 of the Uniform Guidance states that pass-thru entities must evaluate each subrecipient's risk of noncompliance with federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. This evaluation may include, but is not limited to, (1) The subrecipient's prior experience with the same or similar subawards; (2) The results of previous audits including whether or not the subrecipient receives a single audit and the extent to which the same or similar subaward has been audited as a major program; and (3) Whether the subrecipient has new personnel or new or substantially changed systems. Based on the results of the evaluation, the City would then have to consider the extent to which monitoring procedures are required. At a minimum, the City must, (1) Review financial and performance reports required by the City, (2) Follow-up and ensure that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the City detected through audits, on-site reviews, and other means, and (3) Issue a management decision for audit findings pertaining to the federal award provided to the subrecipient from the City as required by Section 200.521 of the Uniform Guidance. Additionally, the City must perform monitoring visits as stipulated in the contracts between the City and the subrecipients. Condition: The City does not have policies and procedures in place to perform the required risk assessment of subrecipients to determine the extent of monitoring procedures, and then perform and document the monitoring procedures performed. Cause: There is no documentation of any subrecipient risk assessment being performed for grants provided to subrecipients for 2019, and only partial documentation of any subrecipient monitoring procedures being performed. Effect: Subrecipient monitoring procedures were not properly performed and documented by the City. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to perform risk assessment of subrecipients, in order to determine the extent of monitoring procedures and performance of the monitoring procedures themselves. Recommendation: We recommend the City implement procedures to ensure risk assessment of subrecipients prior to each subaward is performed in accordance with the Uniform Guidance requirements and thoroughly documented. We further recommend that the required subrecipient monitoring be performed and documented for each subaward.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditing standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit 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), require auditors to obtain sufficient and appropriate audit evidence needed to perform the audit. Condition: The City of York was not able to provide sufficient and appropriate audit evidence for balances and disclosures reported in the SEFA. Cause: Due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Effect or Potential Effect: The inability to appropriately support balances and disclosures leaves the City unable to verify whether any adjustments may be necessary. This impact is material. Context: Support for virtually all balances and disclosures was not able to be provided to verify balances and disclosures reported in the City’s SEFA Recommendation: We recommend that the City retains all support for transactions and account balances as well as performs reconciliations at month and year ends to verify if any adjustments are necessary.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Auditee responsibilities as outlined in section 2 CFR 200.508 include providing the auditor with access to personnel, accounts, books, records, supporting documentation, and other information as needed for the auditor to perform the audit. Condition: Supporting documentation related to the major program was not provided to the auditor due to various factors, all subsequent to year end, including turnover of all key personnel, the destruction of the City’s servers and the conversion to a new accounting system leaving the old accounting system widely unused and unsupported, the completeness and availability of all records, management has been unable to produce records to support the following: material balances stated in the accompanying financial statements, compliance with laws and regulations; the identification and disclosure of all laws, regulations, and provisions of contracts and grant agreements directly and materially affecting the determination of financial statement amounts and; the presence or absence of fraud involving management or employees with significant roles in internal control; compliance with laws, regulations, and provisions of contracts and grant agreements, including budget laws, compliance with any debt covenants, identification of subsequent events, commitments and contingencies, the identification of all Federal assistance programs and compliance with Federal grant requirements. Additionally, the amount of time which has passed since the year end under audit has further exacerbated these issues. We were unable to satisfy ourselves by other audit procedures concerning these balances and disclosures. Cause: Management determined sufficient information could not be provided to satisfy the audit requirements. Effect: Noncompliance with federal regulations can result in the federal government imposing additional requirements or withholding, disallowing or suspending grant funding. Context: Audit evidence for direct and material compliance requirements related to the major program noted above was not provided. This included the corresponding grant agreements for the five awards under this program listed on the SEFA. Recommendation: Program directors and administrators should work together to ensure supporting documentation for federal awards is appropriately maintained.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.302 of the Uniform Guidance states that the financial management system must provide for identification, in its accounts, of all federal awards received and expended and the federal programs under which they were received. federal program and federal award identification must include, as applicable, the AL title and number, federal award identification and year, name of the federal agency, and the name of the pass-through entity, if any. Condition: The City does not have policies and procedures in place to accurately and completely account for federally funded activities separately from non-federally funded activities in their financial management system. Cause: Inaccurate accounting of grant expenditures in the City’s financial management system. Effect: The City did not consistently segregate and identify federal grant expenditures separately from their nonfederal expenditures. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to accurately account for federally funded activities separately from non-federally funded activities in their financial management system. Recommendation: We recommend the City implement procedures to ensure consistent and accurate accounting for federal grant expenditures in accordance with section 2 CFR 200.302 of the Uniform Guidance.

Federal Agency: U.S. Department of Housing and Urban Development Federal Program: 14.218 Entitlement Grants Cluster: Community Development Block Grants/Entitlement Grants Identification Number: B-15-MC-42-0018; B-16-MC-42-0018; B-17-MC-42-0018; B-18-MC-42-0018; B-19- MC-42-0018 Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Period of Performance; Reporting; Special Tests and Provisions Type of Finding: Material weakness in internal control over major program; Noncompliance Criteria: Section 2 CFR 200.331 of the Uniform Guidance states that pass-thru entities must evaluate each subrecipient's risk of noncompliance with federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. This evaluation may include, but is not limited to, (1) The subrecipient's prior experience with the same or similar subawards; (2) The results of previous audits including whether or not the subrecipient receives a single audit and the extent to which the same or similar subaward has been audited as a major program; and (3) Whether the subrecipient has new personnel or new or substantially changed systems. Based on the results of the evaluation, the City would then have to consider the extent to which monitoring procedures are required. At a minimum, the City must, (1) Review financial and performance reports required by the City, (2) Follow-up and ensure that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the City detected through audits, on-site reviews, and other means, and (3) Issue a management decision for audit findings pertaining to the federal award provided to the subrecipient from the City as required by Section 200.521 of the Uniform Guidance. Additionally, the City must perform monitoring visits as stipulated in the contracts between the City and the subrecipients. Condition: The City does not have policies and procedures in place to perform the required risk assessment of subrecipients to determine the extent of monitoring procedures, and then perform and document the monitoring procedures performed. Cause: There is no documentation of any subrecipient risk assessment being performed for grants provided to subrecipients for 2019, and only partial documentation of any subrecipient monitoring procedures being performed. Effect: Subrecipient monitoring procedures were not properly performed and documented by the City. Questioned costs: There are no questioned costs associated with this finding. Context: The City needs to create and implement a policy to perform risk assessment of subrecipients, in order to determine the extent of monitoring procedures and performance of the monitoring procedures themselves. Recommendation: We recommend the City implement procedures to ensure risk assessment of subrecipients prior to each subaward is performed in accordance with the Uniform Guidance requirements and thoroughly documented. We further recommend that the required subrecipient monitoring be performed and documented for each subaward.