Audit 333873

Coronavirus State and Local Fiscal Recovery Funds, ALN 21.027, Matching, Level of Effort, Earmarking - Matching Condition: The revenue loss calculation included inputs from fiscal year 2022 ACFR that were overstated by approximately $1 million. Criteria: The revenue loss should be calculated by determining the revenue reported in the base year (FY19) and using an estimated growth rate to determine the amount of revenue the locality would have earned had the pandemic not occurred. The revenues reported in subsequent years (FY20, FY21, FY22) should then be compared to the estimated revenue to determine the revenue loss. Both the revenue used in the base and subsequent years should agree to the corresponding year ACFR. Cause: The City’s review of the revenue loss calculation did not detect this error. Effect: The FY22 actual amount reported in the ACFR was approximately $1 million less than what was used in the calculation. There was no impact to the amount of funds claimed under revenue loss. Recommendation: We recommend a review of the calculation prior to finalization. Supporting documentation should be maintained to support all figures in the calculation. Views of Responsible Officials and Planned Corrective Action: We concur with this finding. This error was a result of one of the revenue lines used in the original FY22 estimate not being updated with actual values. There is no impact to the amount of funds claimed under revenue loss because correction of the error results in additional revenue loss, which is not needed in the calculation. The City of Staunton met the entire revenue loss needed by only using a portion of the FY22 calculated revenue loss. Staff will update supporting documentation with the correct figure.

Coronavirus State and Local Fiscal Recovery Funds, ALN 21.027, Matching, Level of Effort, Earmarking - Matching Condition: The revenue loss calculation included inputs from fiscal year 2022 ACFR that were overstated by approximately $1 million. Criteria: The revenue loss should be calculated by determining the revenue reported in the base year (FY19) and using an estimated growth rate to determine the amount of revenue the locality would have earned had the pandemic not occurred. The revenues reported in subsequent years (FY20, FY21, FY22) should then be compared to the estimated revenue to determine the revenue loss. Both the revenue used in the base and subsequent years should agree to the corresponding year ACFR. Cause: The City’s review of the revenue loss calculation did not detect this error. Effect: The FY22 actual amount reported in the ACFR was approximately $1 million less than what was used in the calculation. There was no impact to the amount of funds claimed under revenue loss. Recommendation: We recommend a review of the calculation prior to finalization. Supporting documentation should be maintained to support all figures in the calculation. Views of Responsible Officials and Planned Corrective Action: We concur with this finding. This error was a result of one of the revenue lines used in the original FY22 estimate not being updated with actual values. There is no impact to the amount of funds claimed under revenue loss because correction of the error results in additional revenue loss, which is not needed in the calculation. The City of Staunton met the entire revenue loss needed by only using a portion of the FY22 calculated revenue loss. Staff will update supporting documentation with the correct figure.