Audit 334957

FY End
2024-06-30
Total Expended
$2.27M
Findings
20
Programs
2
Organization: City of Marine City (MI)
Year: 2024 Accepted: 2024-12-28

Organization Exclusion Status:

Checking exclusion status...

Findings

ID Ref Severity Repeat Requirement
517071 2024-005 Material Weakness - P
517072 2024-005 Material Weakness - P
517073 2024-005 Material Weakness - P
517074 2024-005 Material Weakness - P
517075 2024-005 Material Weakness - P
517076 2024-006 Material Weakness - P
517077 2024-006 Material Weakness - P
517078 2024-006 Material Weakness - P
517079 2024-006 Material Weakness - P
517080 2024-006 Material Weakness - P
1093513 2024-005 Material Weakness - P
1093514 2024-005 Material Weakness - P
1093515 2024-005 Material Weakness - P
1093516 2024-005 Material Weakness - P
1093517 2024-005 Material Weakness - P
1093518 2024-006 Material Weakness - P
1093519 2024-006 Material Weakness - P
1093520 2024-006 Material Weakness - P
1093521 2024-006 Material Weakness - P
1093522 2024-006 Material Weakness - P

Programs

ALN Program Spent Major Findings
21.027 Coronavirus State and Local Fiscal Recovery Funds $2.00M Yes 2
97.067 Homeland Security Grant Program $5,945 - 2

Contacts

Name Title Type
Z2QYRN8EPEY3 Katy Posey Auditee
8106765256 Curtis McBride Auditor
No contacts on file

Notes to SEFA

Title: Legend Accounting Policies: The Schedule of Expenditures of Federal Awards includes the federal grant activity of the City of Marine City and is presented on the accrual basis of accounting. The Financial Statements for the related funds are reported on the modified-accrual method. See Note 1 to the financial statements for further discussion of the City's accounting policies. The information in this schedule is presented in accordance with the Uniform Grant Guidance. Therefore, some amounts presented in this schedule may differ from those amounts presented in, or used in the preparation of, the basic financial statements. De Minimis Rate Used: Y Rate Explanation: The City of Marine City elects to use the 10% de minimis indirect cost rate where available. * Designates Major Federal Financial Assistance Program
Title: Basis of Presentation Accounting Policies: The Schedule of Expenditures of Federal Awards includes the federal grant activity of the City of Marine City and is presented on the accrual basis of accounting. The Financial Statements for the related funds are reported on the modified-accrual method. See Note 1 to the financial statements for further discussion of the City's accounting policies. The information in this schedule is presented in accordance with the Uniform Grant Guidance. Therefore, some amounts presented in this schedule may differ from those amounts presented in, or used in the preparation of, the basic financial statements. De Minimis Rate Used: Y Rate Explanation: The City of Marine City elects to use the 10% de minimis indirect cost rate where available. The Schedule of Expenditures of Federal Awards includes the federal grant activity of the City of Marine City and is presented on the accrual basis of accounting. The Financial Statements for the related funds are reported on the modified-accrual method. See Note 1 to the financial statements for further discussion of the City's accounting policies. The information in this schedule is presented in accordance with the Uniform Grant Guidance. Therefore, some amounts presented in this schedule may differ from those amounts presented in, or used in the preparation of, the basic financial statements.
Title: De minimis indirect cost rate Accounting Policies: The Schedule of Expenditures of Federal Awards includes the federal grant activity of the City of Marine City and is presented on the accrual basis of accounting. The Financial Statements for the related funds are reported on the modified-accrual method. See Note 1 to the financial statements for further discussion of the City's accounting policies. The information in this schedule is presented in accordance with the Uniform Grant Guidance. Therefore, some amounts presented in this schedule may differ from those amounts presented in, or used in the preparation of, the basic financial statements. De Minimis Rate Used: Y Rate Explanation: The City of Marine City elects to use the 10% de minimis indirect cost rate where available. The City elects to use the 10% de minimis indirect cost rate where available

Finding Details

Criteria: As a precondition to receive federal awards, recipients must have a system of internal controls over federal awards. Condition: The City did not have written procedures for federal awards until October 2024. Cause: The City was not aware they were required to have written policies and procedures for federal awards and did not receive final grant and award documents until late in the fiscal year. Effect: The City's controls and procedures were not adequate to ensure all federal requirements were met. Recommendation: The City should adopt written policies and procedures for federal awards that ensure all federal requirements are met. Response: The City has created and City Commission approved a city-wide Federal Grants policy and procedure for the receiving of Federal grants or awards. This new policy was adopted in November 2024.
Criteria: As a precondition to receive federal awards, recipients must have a system of internal controls over federal awards. Condition: The City did not have written procedures for federal awards until October 2024. Cause: The City was not aware they were required to have written policies and procedures for federal awards and did not receive final grant and award documents until late in the fiscal year. Effect: The City's controls and procedures were not adequate to ensure all federal requirements were met. Recommendation: The City should adopt written policies and procedures for federal awards that ensure all federal requirements are met. Response: The City has created and City Commission approved a city-wide Federal Grants policy and procedure for the receiving of Federal grants or awards. This new policy was adopted in November 2024.
Criteria: As a precondition to receive federal awards, recipients must have a system of internal controls over federal awards. Condition: The City did not have written procedures for federal awards until October 2024. Cause: The City was not aware they were required to have written policies and procedures for federal awards and did not receive final grant and award documents until late in the fiscal year. Effect: The City's controls and procedures were not adequate to ensure all federal requirements were met. Recommendation: The City should adopt written policies and procedures for federal awards that ensure all federal requirements are met. Response: The City has created and City Commission approved a city-wide Federal Grants policy and procedure for the receiving of Federal grants or awards. This new policy was adopted in November 2024.
Criteria: As a precondition to receive federal awards, recipients must have a system of internal controls over federal awards. Condition: The City did not have written procedures for federal awards until October 2024. Cause: The City was not aware they were required to have written policies and procedures for federal awards and did not receive final grant and award documents until late in the fiscal year. Effect: The City's controls and procedures were not adequate to ensure all federal requirements were met. Recommendation: The City should adopt written policies and procedures for federal awards that ensure all federal requirements are met. Response: The City has created and City Commission approved a city-wide Federal Grants policy and procedure for the receiving of Federal grants or awards. This new policy was adopted in November 2024.
Criteria: As a precondition to receive federal awards, recipients must have a system of internal controls over federal awards. Condition: The City did not have written procedures for federal awards until October 2024. Cause: The City was not aware they were required to have written policies and procedures for federal awards and did not receive final grant and award documents until late in the fiscal year. Effect: The City's controls and procedures were not adequate to ensure all federal requirements were met. Recommendation: The City should adopt written policies and procedures for federal awards that ensure all federal requirements are met. Response: The City has created and City Commission approved a city-wide Federal Grants policy and procedure for the receiving of Federal grants or awards. This new policy was adopted in November 2024.
Criteria: Per Federal regulations, the auditee must prepare a schedule of expenditures of federal awards which reconciles to the financial statements. Condition: The City did not identify they were subject to a single audit and the auditors assisted in the preparation of the SEFA. Context: In fiscal year 2024, the City had $2,271,467 in federal program expenditures. Additionally, $1,335,200 was not recorded in the general ledger pending ability to request reimbursement from the State before paying the vendor. Cause: The City did not have proper controls and processes in place to ensure all federal funds expended were properly monitored and tracked for single audit. Effect: The City could fail to identify an audit over compliance for federal programs is requried and all federal funds were included. Recommendation: The City should consider policies and procedures to ensure all sources of federal funds are being monitored and identified for proper recognition in the financial statements and SEFA. Response: With the multiple award year of ARPA federal funds, and the addition of both Federal funds and state funds being awarded in multiple fiscal years for water project (DWSRF); the ability to track these funds and appropriately ledger/journal notes these expenditures were lacking. There was question as to if the amount the City's received was over the $750,000 threshold due to invoicing and payment dates being in multiple fiscal years. Going forward, the City is aware that the invoicing for the use of Federal Funds are the amounts to be looked at when deciding if a single audit needs to be completed. The City will make the auditors aware of the need for a single audit prior to them completing the normal annual audit each year it is necessary.
Criteria: Per Federal regulations, the auditee must prepare a schedule of expenditures of federal awards which reconciles to the financial statements. Condition: The City did not identify they were subject to a single audit and the auditors assisted in the preparation of the SEFA. Context: In fiscal year 2024, the City had $2,271,467 in federal program expenditures. Additionally, $1,335,200 was not recorded in the general ledger pending ability to request reimbursement from the State before paying the vendor. Cause: The City did not have proper controls and processes in place to ensure all federal funds expended were properly monitored and tracked for single audit. Effect: The City could fail to identify an audit over compliance for federal programs is requried and all federal funds were included. Recommendation: The City should consider policies and procedures to ensure all sources of federal funds are being monitored and identified for proper recognition in the financial statements and SEFA. Response: With the multiple award year of ARPA federal funds, and the addition of both Federal funds and state funds being awarded in multiple fiscal years for water project (DWSRF); the ability to track these funds and appropriately ledger/journal notes these expenditures were lacking. There was question as to if the amount the City's received was over the $750,000 threshold due to invoicing and payment dates being in multiple fiscal years. Going forward, the City is aware that the invoicing for the use of Federal Funds are the amounts to be looked at when deciding if a single audit needs to be completed. The City will make the auditors aware of the need for a single audit prior to them completing the normal annual audit each year it is necessary.
Criteria: Per Federal regulations, the auditee must prepare a schedule of expenditures of federal awards which reconciles to the financial statements. Condition: The City did not identify they were subject to a single audit and the auditors assisted in the preparation of the SEFA. Context: In fiscal year 2024, the City had $2,271,467 in federal program expenditures. Additionally, $1,335,200 was not recorded in the general ledger pending ability to request reimbursement from the State before paying the vendor. Cause: The City did not have proper controls and processes in place to ensure all federal funds expended were properly monitored and tracked for single audit. Effect: The City could fail to identify an audit over compliance for federal programs is requried and all federal funds were included. Recommendation: The City should consider policies and procedures to ensure all sources of federal funds are being monitored and identified for proper recognition in the financial statements and SEFA. Response: With the multiple award year of ARPA federal funds, and the addition of both Federal funds and state funds being awarded in multiple fiscal years for water project (DWSRF); the ability to track these funds and appropriately ledger/journal notes these expenditures were lacking. There was question as to if the amount the City's received was over the $750,000 threshold due to invoicing and payment dates being in multiple fiscal years. Going forward, the City is aware that the invoicing for the use of Federal Funds are the amounts to be looked at when deciding if a single audit needs to be completed. The City will make the auditors aware of the need for a single audit prior to them completing the normal annual audit each year it is necessary.
Criteria: Per Federal regulations, the auditee must prepare a schedule of expenditures of federal awards which reconciles to the financial statements. Condition: The City did not identify they were subject to a single audit and the auditors assisted in the preparation of the SEFA. Context: In fiscal year 2024, the City had $2,271,467 in federal program expenditures. Additionally, $1,335,200 was not recorded in the general ledger pending ability to request reimbursement from the State before paying the vendor. Cause: The City did not have proper controls and processes in place to ensure all federal funds expended were properly monitored and tracked for single audit. Effect: The City could fail to identify an audit over compliance for federal programs is requried and all federal funds were included. Recommendation: The City should consider policies and procedures to ensure all sources of federal funds are being monitored and identified for proper recognition in the financial statements and SEFA. Response: With the multiple award year of ARPA federal funds, and the addition of both Federal funds and state funds being awarded in multiple fiscal years for water project (DWSRF); the ability to track these funds and appropriately ledger/journal notes these expenditures were lacking. There was question as to if the amount the City's received was over the $750,000 threshold due to invoicing and payment dates being in multiple fiscal years. Going forward, the City is aware that the invoicing for the use of Federal Funds are the amounts to be looked at when deciding if a single audit needs to be completed. The City will make the auditors aware of the need for a single audit prior to them completing the normal annual audit each year it is necessary.
Criteria: Per Federal regulations, the auditee must prepare a schedule of expenditures of federal awards which reconciles to the financial statements. Condition: The City did not identify they were subject to a single audit and the auditors assisted in the preparation of the SEFA. Context: In fiscal year 2024, the City had $2,271,467 in federal program expenditures. Additionally, $1,335,200 was not recorded in the general ledger pending ability to request reimbursement from the State before paying the vendor. Cause: The City did not have proper controls and processes in place to ensure all federal funds expended were properly monitored and tracked for single audit. Effect: The City could fail to identify an audit over compliance for federal programs is requried and all federal funds were included. Recommendation: The City should consider policies and procedures to ensure all sources of federal funds are being monitored and identified for proper recognition in the financial statements and SEFA. Response: With the multiple award year of ARPA federal funds, and the addition of both Federal funds and state funds being awarded in multiple fiscal years for water project (DWSRF); the ability to track these funds and appropriately ledger/journal notes these expenditures were lacking. There was question as to if the amount the City's received was over the $750,000 threshold due to invoicing and payment dates being in multiple fiscal years. Going forward, the City is aware that the invoicing for the use of Federal Funds are the amounts to be looked at when deciding if a single audit needs to be completed. The City will make the auditors aware of the need for a single audit prior to them completing the normal annual audit each year it is necessary.
Criteria: As a precondition to receive federal awards, recipients must have a system of internal controls over federal awards. Condition: The City did not have written procedures for federal awards until October 2024. Cause: The City was not aware they were required to have written policies and procedures for federal awards and did not receive final grant and award documents until late in the fiscal year. Effect: The City's controls and procedures were not adequate to ensure all federal requirements were met. Recommendation: The City should adopt written policies and procedures for federal awards that ensure all federal requirements are met. Response: The City has created and City Commission approved a city-wide Federal Grants policy and procedure for the receiving of Federal grants or awards. This new policy was adopted in November 2024.
Criteria: As a precondition to receive federal awards, recipients must have a system of internal controls over federal awards. Condition: The City did not have written procedures for federal awards until October 2024. Cause: The City was not aware they were required to have written policies and procedures for federal awards and did not receive final grant and award documents until late in the fiscal year. Effect: The City's controls and procedures were not adequate to ensure all federal requirements were met. Recommendation: The City should adopt written policies and procedures for federal awards that ensure all federal requirements are met. Response: The City has created and City Commission approved a city-wide Federal Grants policy and procedure for the receiving of Federal grants or awards. This new policy was adopted in November 2024.
Criteria: As a precondition to receive federal awards, recipients must have a system of internal controls over federal awards. Condition: The City did not have written procedures for federal awards until October 2024. Cause: The City was not aware they were required to have written policies and procedures for federal awards and did not receive final grant and award documents until late in the fiscal year. Effect: The City's controls and procedures were not adequate to ensure all federal requirements were met. Recommendation: The City should adopt written policies and procedures for federal awards that ensure all federal requirements are met. Response: The City has created and City Commission approved a city-wide Federal Grants policy and procedure for the receiving of Federal grants or awards. This new policy was adopted in November 2024.
Criteria: As a precondition to receive federal awards, recipients must have a system of internal controls over federal awards. Condition: The City did not have written procedures for federal awards until October 2024. Cause: The City was not aware they were required to have written policies and procedures for federal awards and did not receive final grant and award documents until late in the fiscal year. Effect: The City's controls and procedures were not adequate to ensure all federal requirements were met. Recommendation: The City should adopt written policies and procedures for federal awards that ensure all federal requirements are met. Response: The City has created and City Commission approved a city-wide Federal Grants policy and procedure for the receiving of Federal grants or awards. This new policy was adopted in November 2024.
Criteria: As a precondition to receive federal awards, recipients must have a system of internal controls over federal awards. Condition: The City did not have written procedures for federal awards until October 2024. Cause: The City was not aware they were required to have written policies and procedures for federal awards and did not receive final grant and award documents until late in the fiscal year. Effect: The City's controls and procedures were not adequate to ensure all federal requirements were met. Recommendation: The City should adopt written policies and procedures for federal awards that ensure all federal requirements are met. Response: The City has created and City Commission approved a city-wide Federal Grants policy and procedure for the receiving of Federal grants or awards. This new policy was adopted in November 2024.
Criteria: Per Federal regulations, the auditee must prepare a schedule of expenditures of federal awards which reconciles to the financial statements. Condition: The City did not identify they were subject to a single audit and the auditors assisted in the preparation of the SEFA. Context: In fiscal year 2024, the City had $2,271,467 in federal program expenditures. Additionally, $1,335,200 was not recorded in the general ledger pending ability to request reimbursement from the State before paying the vendor. Cause: The City did not have proper controls and processes in place to ensure all federal funds expended were properly monitored and tracked for single audit. Effect: The City could fail to identify an audit over compliance for federal programs is requried and all federal funds were included. Recommendation: The City should consider policies and procedures to ensure all sources of federal funds are being monitored and identified for proper recognition in the financial statements and SEFA. Response: With the multiple award year of ARPA federal funds, and the addition of both Federal funds and state funds being awarded in multiple fiscal years for water project (DWSRF); the ability to track these funds and appropriately ledger/journal notes these expenditures were lacking. There was question as to if the amount the City's received was over the $750,000 threshold due to invoicing and payment dates being in multiple fiscal years. Going forward, the City is aware that the invoicing for the use of Federal Funds are the amounts to be looked at when deciding if a single audit needs to be completed. The City will make the auditors aware of the need for a single audit prior to them completing the normal annual audit each year it is necessary.
Criteria: Per Federal regulations, the auditee must prepare a schedule of expenditures of federal awards which reconciles to the financial statements. Condition: The City did not identify they were subject to a single audit and the auditors assisted in the preparation of the SEFA. Context: In fiscal year 2024, the City had $2,271,467 in federal program expenditures. Additionally, $1,335,200 was not recorded in the general ledger pending ability to request reimbursement from the State before paying the vendor. Cause: The City did not have proper controls and processes in place to ensure all federal funds expended were properly monitored and tracked for single audit. Effect: The City could fail to identify an audit over compliance for federal programs is requried and all federal funds were included. Recommendation: The City should consider policies and procedures to ensure all sources of federal funds are being monitored and identified for proper recognition in the financial statements and SEFA. Response: With the multiple award year of ARPA federal funds, and the addition of both Federal funds and state funds being awarded in multiple fiscal years for water project (DWSRF); the ability to track these funds and appropriately ledger/journal notes these expenditures were lacking. There was question as to if the amount the City's received was over the $750,000 threshold due to invoicing and payment dates being in multiple fiscal years. Going forward, the City is aware that the invoicing for the use of Federal Funds are the amounts to be looked at when deciding if a single audit needs to be completed. The City will make the auditors aware of the need for a single audit prior to them completing the normal annual audit each year it is necessary.
Criteria: Per Federal regulations, the auditee must prepare a schedule of expenditures of federal awards which reconciles to the financial statements. Condition: The City did not identify they were subject to a single audit and the auditors assisted in the preparation of the SEFA. Context: In fiscal year 2024, the City had $2,271,467 in federal program expenditures. Additionally, $1,335,200 was not recorded in the general ledger pending ability to request reimbursement from the State before paying the vendor. Cause: The City did not have proper controls and processes in place to ensure all federal funds expended were properly monitored and tracked for single audit. Effect: The City could fail to identify an audit over compliance for federal programs is requried and all federal funds were included. Recommendation: The City should consider policies and procedures to ensure all sources of federal funds are being monitored and identified for proper recognition in the financial statements and SEFA. Response: With the multiple award year of ARPA federal funds, and the addition of both Federal funds and state funds being awarded in multiple fiscal years for water project (DWSRF); the ability to track these funds and appropriately ledger/journal notes these expenditures were lacking. There was question as to if the amount the City's received was over the $750,000 threshold due to invoicing and payment dates being in multiple fiscal years. Going forward, the City is aware that the invoicing for the use of Federal Funds are the amounts to be looked at when deciding if a single audit needs to be completed. The City will make the auditors aware of the need for a single audit prior to them completing the normal annual audit each year it is necessary.
Criteria: Per Federal regulations, the auditee must prepare a schedule of expenditures of federal awards which reconciles to the financial statements. Condition: The City did not identify they were subject to a single audit and the auditors assisted in the preparation of the SEFA. Context: In fiscal year 2024, the City had $2,271,467 in federal program expenditures. Additionally, $1,335,200 was not recorded in the general ledger pending ability to request reimbursement from the State before paying the vendor. Cause: The City did not have proper controls and processes in place to ensure all federal funds expended were properly monitored and tracked for single audit. Effect: The City could fail to identify an audit over compliance for federal programs is requried and all federal funds were included. Recommendation: The City should consider policies and procedures to ensure all sources of federal funds are being monitored and identified for proper recognition in the financial statements and SEFA. Response: With the multiple award year of ARPA federal funds, and the addition of both Federal funds and state funds being awarded in multiple fiscal years for water project (DWSRF); the ability to track these funds and appropriately ledger/journal notes these expenditures were lacking. There was question as to if the amount the City's received was over the $750,000 threshold due to invoicing and payment dates being in multiple fiscal years. Going forward, the City is aware that the invoicing for the use of Federal Funds are the amounts to be looked at when deciding if a single audit needs to be completed. The City will make the auditors aware of the need for a single audit prior to them completing the normal annual audit each year it is necessary.
Criteria: Per Federal regulations, the auditee must prepare a schedule of expenditures of federal awards which reconciles to the financial statements. Condition: The City did not identify they were subject to a single audit and the auditors assisted in the preparation of the SEFA. Context: In fiscal year 2024, the City had $2,271,467 in federal program expenditures. Additionally, $1,335,200 was not recorded in the general ledger pending ability to request reimbursement from the State before paying the vendor. Cause: The City did not have proper controls and processes in place to ensure all federal funds expended were properly monitored and tracked for single audit. Effect: The City could fail to identify an audit over compliance for federal programs is requried and all federal funds were included. Recommendation: The City should consider policies and procedures to ensure all sources of federal funds are being monitored and identified for proper recognition in the financial statements and SEFA. Response: With the multiple award year of ARPA federal funds, and the addition of both Federal funds and state funds being awarded in multiple fiscal years for water project (DWSRF); the ability to track these funds and appropriately ledger/journal notes these expenditures were lacking. There was question as to if the amount the City's received was over the $750,000 threshold due to invoicing and payment dates being in multiple fiscal years. Going forward, the City is aware that the invoicing for the use of Federal Funds are the amounts to be looked at when deciding if a single audit needs to be completed. The City will make the auditors aware of the need for a single audit prior to them completing the normal annual audit each year it is necessary.