Audit 356131

Criteria: Activities should be reviewed and approved to determine if costs are allowable prior to disbursement. Condition: Two disbursements out of ten tested were not supported by a signed manifest. Cause: There was a lack of oversight by staff in providing manifests for management signature. Effect: This is a significant deficiency in internal control over activities allowed and unallowed, and allowable costs/cost principles. Questioned Costs: N/A Recommendation: We recommend that all manifests be approved by the Town Manager, or Assistant Town Manager in his absence, prior to release of funds. Management’s Response: All manifests should have been and will be signed by management. We have started more internal training with the Accounts Payable department to ensure manifests are signed.

Criteria: Grantees are required to maintain records that sufficiently identify the amount, source, and expenditure of Federal funds for Federal awards. These records must contain information necessary to identify Federal awards, authorizations, financial obligations, unobligated balances, as well as assets, expenditures, income, and interest. Condition: Three of the five reimbursements received during the fiscal year were not recorded in the Town’s general ledger until the time of the audit. Cause: Cash was not consistently reconciled during 2023, therefore unrecorded transactions were not identified. The responsible employee did not appear to be trained in the reconciliation function within the accounting system, and management was not reviewing reconciliations, and was not aware that the process was not completed. Effect: There was a significant deficiency in the internal control over cash management. Questioned Costs: N/A Recommendation: We recommend that reimbursement requests be recorded as intergovernmental receivables when submitted, and receipts be recorded against those receivables when deposited. Management’s Response: We have a new employee that is much more highly trained in bookkeeping and accounting. We have started to reconcile all of 2024 accounts again to ensure accuracy. Once completed, we will be back on track to complete monthly reconciliations of all accounts. We expect this to happen by the summer of 2025. Expenditure and reimbursement of all federal funds will be recorded timely and accurately.

Criteria: Activities should be reviewed and approved to determine if costs are allowable prior to disbursement. Condition: Two disbursements out of ten tested were not supported by a signed manifest. Cause: There was a lack of oversight by staff in providing manifests for management signature. Effect: This is a significant deficiency in internal control over activities allowed and unallowed, and allowable costs/cost principles. Questioned Costs: N/A Recommendation: We recommend that all manifests be approved by the Town Manager, or Assistant Town Manager in his absence, prior to release of funds. Management’s Response: All manifests should have been and will be signed by management. We have started more internal training with the Accounts Payable department to ensure manifests are signed.

Criteria: Grantees are required to maintain records that sufficiently identify the amount, source, and expenditure of Federal funds for Federal awards. These records must contain information necessary to identify Federal awards, authorizations, financial obligations, unobligated balances, as well as assets, expenditures, income, and interest. Condition: Three of the five reimbursements received during the fiscal year were not recorded in the Town’s general ledger until the time of the audit. Cause: Cash was not consistently reconciled during 2023, therefore unrecorded transactions were not identified. The responsible employee did not appear to be trained in the reconciliation function within the accounting system, and management was not reviewing reconciliations, and was not aware that the process was not completed. Effect: There was a significant deficiency in the internal control over cash management. Questioned Costs: N/A Recommendation: We recommend that reimbursement requests be recorded as intergovernmental receivables when submitted, and receipts be recorded against those receivables when deposited. Management’s Response: We have a new employee that is much more highly trained in bookkeeping and accounting. We have started to reconcile all of 2024 accounts again to ensure accuracy. Once completed, we will be back on track to complete monthly reconciliations of all accounts. We expect this to happen by the summer of 2025. Expenditure and reimbursement of all federal funds will be recorded timely and accurately.