Audit 361442

FY End
2023-12-31
Total Expended
$4.18M
Findings
2
Programs
9
Organization: Washington County Arkansas (AR)
Year: 2023 Accepted: 2025-07-03
Auditor: Frost PLLC

Organization Exclusion Status:

Checking exclusion status...

Findings

ID Ref Severity Repeat Requirement
570489 2023-001 Significant Deficiency - P
1146931 2023-001 Significant Deficiency - P

Contacts

Name Title Type
MFCWFCQV8NA8 Bridget Russell Auditee
4794441895 Brian Ettehad Auditor
No contacts on file

Notes to SEFA

Title: Summary of Significant Accounting Policies Accounting Policies: Basis of accounting – Expenditures reported on the SEFA are reported on the cash basis of accounting which is a comprehensive basis of accounting other than generally accepted accounting principles. All transactions relating to the County’s participation in the federal programs are recognized as either cash receipts or disbursements. Noncash transactions are not recognized in the SEFA. Disbursements are recognized following the cost principles contained in the U.S. Office of Management and Budget Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement. The County operates under an elected form of government similar to a mayor-council format. Accounting principles generally accepted in the United States of America require that the reporting entity include (1) the primary government, (2) organizations for which the primary government is financially accountable, and (3) other organizations for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entity’s financial statements to be misleading or incomplete. The criteria provided in the Government Accounting Standards Board Statement No. 14, “The Financial Reporting Entity,” have been considered. The SEFA represents only the federal programs of the County and does not include data of other funds of the primary government necessary for reporting in conformity with accounting principles generally accepted in the United States of America. De Minimis Rate Used: Y Rate Explanation: The County has not elected to use the 10% de minimis indirect cost rate as allowed in the Uniform Guidance, Section 200.414, “Indirect (F&A) Costs.” Basis of accounting – Expenditures reported on the SEFA are reported on the cash basis of accounting which is a comprehensive basis of accounting other than generally accepted accounting principles. All transactions relating to the County’s participation in the federal programs are recognized as either cash receipts or disbursements. Noncash transactions are not recognized in the SEFA. Disbursements are recognized following the cost principles contained in the U.S. Office of Management and Budget Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement. The County operates under an elected form of government similar to a mayor-council format. Accounting principles generally accepted in the United States of America require that the reporting entity include (1) the primary government, (2) organizations for which the primary government is financially accountable, and (3) other organizations for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entity’s financial statements to be misleading or incomplete. The criteria provided in the Government Accounting Standards Board Statement No. 14, “The Financial Reporting Entity,” have been considered. The SEFA represents only the federal programs of the County and does not include data of other funds of the primary government necessary for reporting in conformity with accounting principles generally accepted in the United States of America.
Title: Indirect Cost Rate Accounting Policies: Basis of accounting – Expenditures reported on the SEFA are reported on the cash basis of accounting which is a comprehensive basis of accounting other than generally accepted accounting principles. All transactions relating to the County’s participation in the federal programs are recognized as either cash receipts or disbursements. Noncash transactions are not recognized in the SEFA. Disbursements are recognized following the cost principles contained in the U.S. Office of Management and Budget Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement. The County operates under an elected form of government similar to a mayor-council format. Accounting principles generally accepted in the United States of America require that the reporting entity include (1) the primary government, (2) organizations for which the primary government is financially accountable, and (3) other organizations for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entity’s financial statements to be misleading or incomplete. The criteria provided in the Government Accounting Standards Board Statement No. 14, “The Financial Reporting Entity,” have been considered. The SEFA represents only the federal programs of the County and does not include data of other funds of the primary government necessary for reporting in conformity with accounting principles generally accepted in the United States of America. De Minimis Rate Used: Y Rate Explanation: The County has not elected to use the 10% de minimis indirect cost rate as allowed in the Uniform Guidance, Section 200.414, “Indirect (F&A) Costs.” The County has not elected to use the 10% de minimis indirect cost rate as allowed in the Uniform Guidance, Section 200.414, “Indirect (F&A) Costs.”
Title: Contingencies Accounting Policies: Basis of accounting – Expenditures reported on the SEFA are reported on the cash basis of accounting which is a comprehensive basis of accounting other than generally accepted accounting principles. All transactions relating to the County’s participation in the federal programs are recognized as either cash receipts or disbursements. Noncash transactions are not recognized in the SEFA. Disbursements are recognized following the cost principles contained in the U.S. Office of Management and Budget Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement. The County operates under an elected form of government similar to a mayor-council format. Accounting principles generally accepted in the United States of America require that the reporting entity include (1) the primary government, (2) organizations for which the primary government is financially accountable, and (3) other organizations for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entity’s financial statements to be misleading or incomplete. The criteria provided in the Government Accounting Standards Board Statement No. 14, “The Financial Reporting Entity,” have been considered. The SEFA represents only the federal programs of the County and does not include data of other funds of the primary government necessary for reporting in conformity with accounting principles generally accepted in the United States of America. De Minimis Rate Used: Y Rate Explanation: The County has not elected to use the 10% de minimis indirect cost rate as allowed in the Uniform Guidance, Section 200.414, “Indirect (F&A) Costs.” The County is subject to possible examinations with respect to grants made by regulations governing its grant activities. These examinations may result in refunds by the County to the grantors in the event of noncompliance.
Title: Subrecipients Accounting Policies: Basis of accounting – Expenditures reported on the SEFA are reported on the cash basis of accounting which is a comprehensive basis of accounting other than generally accepted accounting principles. All transactions relating to the County’s participation in the federal programs are recognized as either cash receipts or disbursements. Noncash transactions are not recognized in the SEFA. Disbursements are recognized following the cost principles contained in the U.S. Office of Management and Budget Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement. The County operates under an elected form of government similar to a mayor-council format. Accounting principles generally accepted in the United States of America require that the reporting entity include (1) the primary government, (2) organizations for which the primary government is financially accountable, and (3) other organizations for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entity’s financial statements to be misleading or incomplete. The criteria provided in the Government Accounting Standards Board Statement No. 14, “The Financial Reporting Entity,” have been considered. The SEFA represents only the federal programs of the County and does not include data of other funds of the primary government necessary for reporting in conformity with accounting principles generally accepted in the United States of America. De Minimis Rate Used: Y Rate Explanation: The County has not elected to use the 10% de minimis indirect cost rate as allowed in the Uniform Guidance, Section 200.414, “Indirect (F&A) Costs.” Several local governmental law enforcement agencies are subrecipients for the Office of National Drug Control Policy High Intensity Drug Trafficking Area grants. Disbursements to subrecipients are considered to be made when the grants’ funds are received and then subsequently disbursed to the subrecipients.
Title: Budgets (Unaudited) Accounting Policies: Basis of accounting – Expenditures reported on the SEFA are reported on the cash basis of accounting which is a comprehensive basis of accounting other than generally accepted accounting principles. All transactions relating to the County’s participation in the federal programs are recognized as either cash receipts or disbursements. Noncash transactions are not recognized in the SEFA. Disbursements are recognized following the cost principles contained in the U.S. Office of Management and Budget Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement. The County operates under an elected form of government similar to a mayor-council format. Accounting principles generally accepted in the United States of America require that the reporting entity include (1) the primary government, (2) organizations for which the primary government is financially accountable, and (3) other organizations for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entity’s financial statements to be misleading or incomplete. The criteria provided in the Government Accounting Standards Board Statement No. 14, “The Financial Reporting Entity,” have been considered. The SEFA represents only the federal programs of the County and does not include data of other funds of the primary government necessary for reporting in conformity with accounting principles generally accepted in the United States of America. De Minimis Rate Used: Y Rate Explanation: The County has not elected to use the 10% de minimis indirect cost rate as allowed in the Uniform Guidance, Section 200.414, “Indirect (F&A) Costs.” The budgets, if applicable, for the grants identified in Note 1 are as follows:

Finding Details

Criteria: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Section (a)(1) requires the audit, the data collection form, and the reporting package must be submitted within 30 calendar days after the auditee receives the auditor’s report(s) or nine months after the end of the audit period (whichever is earlier). Condition: Washington County, Arkansas, Federal Programs (the “County”) noted its 2022 and 2021 Schedule of Expenditures of Federal Awards (“SEFA”) omitted ARPA expenditures prior to the completion of the 2023 SEFA. Cause: The County did not have effective procedures to ensure all grant activity was included in the SEFA. Effect or Potential Effect: The submission of the 2023 SEFA was delayed to correct and resubmit the audits of the 2022 and 2021 SEFA reporting. Recommendation: We recommend the County establish a review process to identify and correct omissions related to its SEFA reporting and a reconciliation of all grant activity with the County’s general ledger. This process will address funds, such as the ARPA funds, that may not have been initially directed to the grant administrator.
Criteria: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Section (a)(1) requires the audit, the data collection form, and the reporting package must be submitted within 30 calendar days after the auditee receives the auditor’s report(s) or nine months after the end of the audit period (whichever is earlier). Condition: Washington County, Arkansas, Federal Programs (the “County”) noted its 2022 and 2021 Schedule of Expenditures of Federal Awards (“SEFA”) omitted ARPA expenditures prior to the completion of the 2023 SEFA. Cause: The County did not have effective procedures to ensure all grant activity was included in the SEFA. Effect or Potential Effect: The submission of the 2023 SEFA was delayed to correct and resubmit the audits of the 2022 and 2021 SEFA reporting. Recommendation: We recommend the County establish a review process to identify and correct omissions related to its SEFA reporting and a reconciliation of all grant activity with the County’s general ledger. This process will address funds, such as the ARPA funds, that may not have been initially directed to the grant administrator.