Finding 2021-01 – Lack of Internal Control Over Financial Reporting – No Accounting System Used
Criteria – Standard accounting practices dictate that control over financial reporting begins with the use of an appropriate accounting system.
Condition – The Board maintains a budget worksheet and a checkbook with receipts and disbursements downloaded from the bank.
Effect – The Board could not produce a trial balance, balance sheet, or income statement for current or past years.
Recommendation – The Board should immediately consult with an accountant to enter the Board’s financial records into an appropriate accounting system.
Management’s Response – The Board has contracted with a local Accountant to begin entering all Board financial records into Quick Books online.
Finding 2021-02 – Lack of Internal Control Over Financial Reporting – No Accounting for Fixed Assets
Criteria – Standard accounting practices dictate that a governmental proprietary funds record its fixed assets on the balance sheet.
Condition – As noted in Finding 2021-01, the Board does not use an accounting system. Therefore, there is no accounting for $2.9M in fixed assets at June 30, 2020 and $8.8M in fixed assets at June 30, 2021.
Effect – The Board cannot accurately list, track, or depreciate its fixed assets with auditor assistance.
Recommendation – The Board should immediately consult with an accountant to enter the Board’s fixed assets into an appropriate accounting system.
Management’s Response – The Board has contracted with a local Accountant to begin entering all Board financial records into Quick Books online.
Finding 2021-03 – Non-Compliance with Uniform Guidance Reporting Requirements – Audit Not Filed Timely with Federal Audit Clearinghouse
Criteria – Audits performed under the auspices of Title 2, Code of Federal Regulations; Part 200 – Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) are required by 2 C.F.R. 200, Subpart F, Paragraph 200.512 (a)(1) to be submitted to the Federal Audit Clearinghouse withing the earlier of 30 days after the receipt of the auditor’s report or 9 months after the end of the audit period.
Condition – The Board will submit the audit report for the fiscal year ending June 30, 2021 to the Federal Audit Clearinghouse by March 31, 2025.
Effect – The Board is submitting its audit report 36 months after the required due date is not compliance with 2 C.F.R. 200.512(a)(1)
Recommendation – In future years, the Board should strive to complete the audit with sufficient time to timely submit to the Federal Audit Clearinghouse.
Management’s Response – Management will implement this recommendation.
Finding 2021-04 – Lack of Internal Control Over Compliance – Unfamiliarity with Federal Compliance Requirements
Criteria – Entities that disburse Federal funds to subrecipients and entities who expend Federal funds in excess of $750,000 (at June 30, 2021) are each required to gain an understanding of the compliance requirements found in 2 C.F.R. 200 – Uniform Guidance for the specific Federal grant awards the entity disburses/receives. The disbursing entity should monitor compliance requirements and ensure compliance requirements are being met.
Condition – The Board shows a lack of familiarity with the 2 C.F.R. 200 – Uniform Guidance compliance requirements.
Effect – This lack of familiarity with the compliance requirements allowed the Federal Audit Clearinghouse deadline to be missed by one year and may, in the future, allow funds to be used in a manner that is not consistent with Allowable Activities and Cost Principles in 2 C.F.R.200 – Uniform Guidance. Other compliance requirements such as Equipment and Real Property Management, Matching and Level of Effort, Reporting, and Special Tests and Provisions may also be affected.
Recommendation – We recommend the Board’s grant manager contact the Federal Aviation Administration and inquire about Uniform Guidance compliance requirements for CFDA 20.106 Airport Improvement Program funds.
Management’s Response – Management will consider the costs and benefits of implementing this recommendation, and with guidance from the Board of Directors proceed in the best interest of the Board.
Finding 2021-01 – Lack of Internal Control Over Financial Reporting – No Accounting System Used
Criteria – Standard accounting practices dictate that control over financial reporting begins with the use of an appropriate accounting system.
Condition – The Board maintains a budget worksheet and a checkbook with receipts and disbursements downloaded from the bank.
Effect – The Board could not produce a trial balance, balance sheet, or income statement for current or past years.
Recommendation – The Board should immediately consult with an accountant to enter the Board’s financial records into an appropriate accounting system.
Management’s Response – The Board has contracted with a local Accountant to begin entering all Board financial records into Quick Books online.
Finding 2021-02 – Lack of Internal Control Over Financial Reporting – No Accounting for Fixed Assets
Criteria – Standard accounting practices dictate that a governmental proprietary funds record its fixed assets on the balance sheet.
Condition – As noted in Finding 2021-01, the Board does not use an accounting system. Therefore, there is no accounting for $2.9M in fixed assets at June 30, 2020 and $8.8M in fixed assets at June 30, 2021.
Effect – The Board cannot accurately list, track, or depreciate its fixed assets with auditor assistance.
Recommendation – The Board should immediately consult with an accountant to enter the Board’s fixed assets into an appropriate accounting system.
Management’s Response – The Board has contracted with a local Accountant to begin entering all Board financial records into Quick Books online.
Finding 2021-03 – Non-Compliance with Uniform Guidance Reporting Requirements – Audit Not Filed Timely with Federal Audit Clearinghouse
Criteria – Audits performed under the auspices of Title 2, Code of Federal Regulations; Part 200 – Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) are required by 2 C.F.R. 200, Subpart F, Paragraph 200.512 (a)(1) to be submitted to the Federal Audit Clearinghouse withing the earlier of 30 days after the receipt of the auditor’s report or 9 months after the end of the audit period.
Condition – The Board will submit the audit report for the fiscal year ending June 30, 2021 to the Federal Audit Clearinghouse by March 31, 2025.
Effect – The Board is submitting its audit report 36 months after the required due date is not compliance with 2 C.F.R. 200.512(a)(1)
Recommendation – In future years, the Board should strive to complete the audit with sufficient time to timely submit to the Federal Audit Clearinghouse.
Management’s Response – Management will implement this recommendation.
Finding 2021-04 – Lack of Internal Control Over Compliance – Unfamiliarity with Federal Compliance Requirements
Criteria – Entities that disburse Federal funds to subrecipients and entities who expend Federal funds in excess of $750,000 (at June 30, 2021) are each required to gain an understanding of the compliance requirements found in 2 C.F.R. 200 – Uniform Guidance for the specific Federal grant awards the entity disburses/receives. The disbursing entity should monitor compliance requirements and ensure compliance requirements are being met.
Condition – The Board shows a lack of familiarity with the 2 C.F.R. 200 – Uniform Guidance compliance requirements.
Effect – This lack of familiarity with the compliance requirements allowed the Federal Audit Clearinghouse deadline to be missed by one year and may, in the future, allow funds to be used in a manner that is not consistent with Allowable Activities and Cost Principles in 2 C.F.R.200 – Uniform Guidance. Other compliance requirements such as Equipment and Real Property Management, Matching and Level of Effort, Reporting, and Special Tests and Provisions may also be affected.
Recommendation – We recommend the Board’s grant manager contact the Federal Aviation Administration and inquire about Uniform Guidance compliance requirements for CFDA 20.106 Airport Improvement Program funds.
Management’s Response – Management will consider the costs and benefits of implementing this recommendation, and with guidance from the Board of Directors proceed in the best interest of the Board.