Audit 358297

FY End
2024-09-30
Total Expended
$3.00M
Findings
2
Programs
3
Organization: Guam Waterworks Authority (GU)
Year: 2024 Accepted: 2025-06-08
Auditor: Ernst & Young

Organization Exclusion Status:

Checking exclusion status...

Findings

ID Ref Severity Repeat Requirement
564142 2024-001 Significant Deficiency - I
1140584 2024-001 Significant Deficiency - I

Contacts

Name Title Type
L63BLKYU5DL7 Taling Taitano Auditee
6713006860 Edgar T. Panlilio Jr. Auditor
No contacts on file

Notes to SEFA

Title: 1 Accounting Policies: Basis of Accounting Expenditures reported on the Schedule are presented on the accrual basis of accounting, consistent with the manner in which GWA maintains its accounting records. Such expenditures are recognized following the cost principles contained in the Uniform Guidance. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the financial statements. All expenses and capital outlays are reported as expenditures. GWA has not elected to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The Authority has elected not to use the 10 percent de minimis indirect cost rate as covered in 2 CFR §200.414 of the Uniform Guidance. The Academy does not receive any indirect cost allocation and no indirect costs were recorded against any federal program for the year ended September 30, 2024. 1. Scope of Audit Guam Waterworks Authority (GWA) is a component unit of the Government of Guam (GovGuam). GWA is subject to the regulations of the Guam Public Utilities Commission (PUC). GWA became an autonomous agency in 1996 under Public Law 23-119. Only the transactions of GWA are included within the scope of the Single Audit. Programs Subject to Single Audit The Schedule of Expenditures of Federal Awards (the Schedule) presents each Federal program related to the U.S. Department of Defense, the U.S. Department of the Treasury, and the U.S. Environmental Protection Agency.
Title: 2 Accounting Policies: Basis of Accounting Expenditures reported on the Schedule are presented on the accrual basis of accounting, consistent with the manner in which GWA maintains its accounting records. Such expenditures are recognized following the cost principles contained in the Uniform Guidance. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the financial statements. All expenses and capital outlays are reported as expenditures. GWA has not elected to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The Authority has elected not to use the 10 percent de minimis indirect cost rate as covered in 2 CFR §200.414 of the Uniform Guidance. The Academy does not receive any indirect cost allocation and no indirect costs were recorded against any federal program for the year ended September 30, 2024. Basis of Presentation The accompanying Schedule includes the federal award activity of GWA for the year ended September 30, 2024. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). As the Schedule presents only a selected portion of the operations of GWA, it is not intended to and does not present the financial position, changes in net position, or cash flows of GWA.
Title: 3 Accounting Policies: Basis of Accounting Expenditures reported on the Schedule are presented on the accrual basis of accounting, consistent with the manner in which GWA maintains its accounting records. Such expenditures are recognized following the cost principles contained in the Uniform Guidance. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the financial statements. All expenses and capital outlays are reported as expenditures. GWA has not elected to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The Authority has elected not to use the 10 percent de minimis indirect cost rate as covered in 2 CFR §200.414 of the Uniform Guidance. The Academy does not receive any indirect cost allocation and no indirect costs were recorded against any federal program for the year ended September 30, 2024. Basis of Accounting Expenditures reported on the Schedule are presented on the accrual basis of accounting, consistent with the manner in which GWA maintains its accounting records. Such expenditures are recognized following the cost principles contained in the Uniform Guidance. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the financial statements. All expenses and capital outlays are reported as expenditures. GWA has not elected to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance.

Finding Details

Finding No.: 2024-001 Federal Agency: U.S. Environmental Protection Agency AL No. and Title: 66.600 – Environmental Protection Consolidated Grants for the Insular Areas – Program Support Federal Award No.: Various Area: Procurement, Suspension and Debarment Questioned Costs: $0 Criteria: 2 CFR section 180.300 requires entities that enter into a covered transaction must verify that the person with whom you intend to do business is not excluded or disqualified by: (a) Checking SAM.gov Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person. Condition: Of 5 out 5 samples tested (100%), GWA did not perform the required verification of persons required by 2 CFR section 1800.300. No questioned cost was identified as subsequent checking of the samples in SAM.gov did not result in identification of suspended or debarred individuals. Cause: There is no formalized procedure in place for verifying the debarment, suspension, or exclusion status of entities prior to entering into covered transactions. Effect or potential effect: GWA is in noncompliance with the applicable requirements. Recommendation: GWA should develop and implement a formal procedure for verifying the debarment, suspension, or exclusion status of entities prior to entering into covered transactions, which includes regular checks against the System for Award Management (SAM) database and other relevant resources. Views of Responsible Officials: GWA acknowledges the audit finding and concurs that a verification through the System for Award Management (SAM.gov) was not completed and documented prior to executing a contract with the identified vendors. GWA recognizes the importance of complying with federal requirements and preventing ineligible parties from participating in federally funded projects.
Finding No.: 2024-001 Federal Agency: U.S. Environmental Protection Agency AL No. and Title: 66.600 – Environmental Protection Consolidated Grants for the Insular Areas – Program Support Federal Award No.: Various Area: Procurement, Suspension and Debarment Questioned Costs: $0 Criteria: 2 CFR section 180.300 requires entities that enter into a covered transaction must verify that the person with whom you intend to do business is not excluded or disqualified by: (a) Checking SAM.gov Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person. Condition: Of 5 out 5 samples tested (100%), GWA did not perform the required verification of persons required by 2 CFR section 1800.300. No questioned cost was identified as subsequent checking of the samples in SAM.gov did not result in identification of suspended or debarred individuals. Cause: There is no formalized procedure in place for verifying the debarment, suspension, or exclusion status of entities prior to entering into covered transactions. Effect or potential effect: GWA is in noncompliance with the applicable requirements. Recommendation: GWA should develop and implement a formal procedure for verifying the debarment, suspension, or exclusion status of entities prior to entering into covered transactions, which includes regular checks against the System for Award Management (SAM) database and other relevant resources. Views of Responsible Officials: GWA acknowledges the audit finding and concurs that a verification through the System for Award Management (SAM.gov) was not completed and documented prior to executing a contract with the identified vendors. GWA recognizes the importance of complying with federal requirements and preventing ineligible parties from participating in federally funded projects.