FAC Explorer

Audit 361491

FY End
2023-12-31
Total Expended
$917,735
Findings
2
Programs
2
Organization: City of Princeton (IN)
Year: 2023 Accepted: 2025-07-07
Auditor: Crowe LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
570504 2023-002 Material Weakness - I
1146946 2023-002 Material Weakness - I

Programs

ALN Program Spent Major Findings
21.027 Covid-19 - Coronavirus State and Local Fiscal Recovery Funds $462,891 Yes 1
10.760 Water and Waste Disposal Systems for Rural Communities $454,844 - 0

Contacts

Name Title Type
KP92XWFQL7X8 David Kennard Auditee
8123853283 Scott Nickerson Auditor
No contacts on file

Notes to SEFA

Title: NOTE 1 - BASIS OF PRESENTATION Accounting Policies: Expenditures reported on the Schedule are reported on the cash basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance, wherein certain types of expenditures are not allowed or are limited as to reimbursement. When federal grants are received on a reimbursement basis, the federal awards are considered expended when the reimbursement is received. De Minimis Rate Used: N Rate Explanation: The City has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. A. Basis of Presentation The accompanying Schedule of Expenditures of Federal Awards (the “Schedule”) includes the federal grant activity of the City of Princeton (the “City”) under programs of the federal government for the year ended December 31, 2023. The information in the 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). Because the Schedule presents only a select portion of the operations of the City, it is not intended to and does not present the receipts, disbursements, and cash and investment balances – regulatory basis of the City. Expenditures reported on the Schedule are reported on the cash basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance, wherein certain types of expenditures are not allowed or are limited as to reimbursement. When federal grants are received on a reimbursement basis, the federal awards are considered expended when the reimbursement is received.
Title: NOTE 2 - INDIRECT COST RATE Accounting Policies: Expenditures reported on the Schedule are reported on the cash basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance, wherein certain types of expenditures are not allowed or are limited as to reimbursement. When federal grants are received on a reimbursement basis, the federal awards are considered expended when the reimbursement is received. De Minimis Rate Used: N Rate Explanation: The City has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. The City has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance.
Title: NOTE 3 - OTHER INFORMATION Accounting Policies: Expenditures reported on the Schedule are reported on the cash basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance, wherein certain types of expenditures are not allowed or are limited as to reimbursement. When federal grants are received on a reimbursement basis, the federal awards are considered expended when the reimbursement is received. De Minimis Rate Used: N Rate Explanation: The City has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. The City did not have any subrecipient activity for the year ended December 31, 2023.

Finding Details

Finding 2023-002
FINDING 2023-002 Information on the federal program: Subject: Coronavirus State and Local Fiscal Recovery Funds - Procurement and Suspension and Debarment Federal Agency: U.S. Department of Treasury Assistance Listing Number: 21.027 Federal Award Number: CY 2021 Pass-Through Entity: Direct Grant Compliance Requirements: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Other Matters Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR section 200.303 states in part: "The non-Federal entity must use one of the following methods of procurement… (b) Simplified acquisition thresholds. The non-Federal entity is responsible for determining an appropriate simplified acquisition threshold based on internal controls, an evaluation of risk and its documented procurement procedures which must not exceed the threshold established in the FAR. When applicable, a lower simplified acquisition threshold used by the non-Federal entity must be authorized or not prohibited under State, local, or tribal laws or regulations. Condition: An effective internal control system was not in place at the City to ensure compliance with requirements related to the grant agreement and the respective procurement method of the Procurement and Suspension and Debarment compliance requirement. Cause: Management had not established a system of internal control that would have ensured proper procurement procedures are followed. Effect: The failure to establish an effective internal control system enabled noncompliance with the grant agreement and the simplified acquisition procurement method of the Procurement and Suspension and Debarment compliance requirement. Questioned Costs: There were no questioned costs identified. Context: Two procurements were selected for testing in the current year. For the small purchase transaction, management only provided the contract. No other procurement support showing evidence of bids was provided. Additionally, support showing that the City had performed a suspension and debarment check was not provided. For the simplified acquisition transaction, management performed procurement for similar services in 2016. The vendor selected in 2016 was used for the transaction charged to the federal grant without obtaining additional bids. Identification as a repeat finding, if applicable: No Recommendation: We recommended that the City’s management establish controls related to the grant agreement and the simplified acquisition purchase procurement method of the Procurement and Suspension and Debarment compliance requirement. Management should ensure that the City’s procurement policy as well as federal guidelines are followed, which includes ensuring the appropriate procurement type is determined and the corresponding requirements are followed. The procurement process and determination should be documented and the appropriate records maintained. We recommend that as part of the procurement process, management perform suspension and debarment checks before entering into contracts with vendors that meet the required threshold. The suspension and debarment checks should be documented and appropriate support maintained. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
Finding 2023-002
FINDING 2023-002 Information on the federal program: Subject: Coronavirus State and Local Fiscal Recovery Funds - Procurement and Suspension and Debarment Federal Agency: U.S. Department of Treasury Assistance Listing Number: 21.027 Federal Award Number: CY 2021 Pass-Through Entity: Direct Grant Compliance Requirements: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Other Matters Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR section 200.303 states in part: "The non-Federal entity must use one of the following methods of procurement… (b) Simplified acquisition thresholds. The non-Federal entity is responsible for determining an appropriate simplified acquisition threshold based on internal controls, an evaluation of risk and its documented procurement procedures which must not exceed the threshold established in the FAR. When applicable, a lower simplified acquisition threshold used by the non-Federal entity must be authorized or not prohibited under State, local, or tribal laws or regulations. Condition: An effective internal control system was not in place at the City to ensure compliance with requirements related to the grant agreement and the respective procurement method of the Procurement and Suspension and Debarment compliance requirement. Cause: Management had not established a system of internal control that would have ensured proper procurement procedures are followed. Effect: The failure to establish an effective internal control system enabled noncompliance with the grant agreement and the simplified acquisition procurement method of the Procurement and Suspension and Debarment compliance requirement. Questioned Costs: There were no questioned costs identified. Context: Two procurements were selected for testing in the current year. For the small purchase transaction, management only provided the contract. No other procurement support showing evidence of bids was provided. Additionally, support showing that the City had performed a suspension and debarment check was not provided. For the simplified acquisition transaction, management performed procurement for similar services in 2016. The vendor selected in 2016 was used for the transaction charged to the federal grant without obtaining additional bids. Identification as a repeat finding, if applicable: No Recommendation: We recommended that the City’s management establish controls related to the grant agreement and the simplified acquisition purchase procurement method of the Procurement and Suspension and Debarment compliance requirement. Management should ensure that the City’s procurement policy as well as federal guidelines are followed, which includes ensuring the appropriate procurement type is determined and the corresponding requirements are followed. The procurement process and determination should be documented and the appropriate records maintained. We recommend that as part of the procurement process, management perform suspension and debarment checks before entering into contracts with vendors that meet the required threshold. The suspension and debarment checks should be documented and appropriate support maintained. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.