FAC Explorer

Audit 361591

FY End
2024-06-30
Total Expended
$4.31M
Findings
22
Programs
9
Organization: City of Rialto (CA)
Year: 2024 Accepted: 2025-07-07
Auditor: Lsl LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
570563 2024-001 Material Weakness Yes P
570564 2024-001 Material Weakness Yes P
570565 2024-001 Material Weakness Yes P
570566 2024-001 Material Weakness Yes P
570567 2024-001 Material Weakness Yes P
570568 2024-001 Material Weakness Yes P
570569 2024-001 Material Weakness Yes P
570570 2024-001 Material Weakness Yes P
570571 2024-001 Material Weakness Yes P
570572 2024-001 Material Weakness Yes P
570573 2024-001 Material Weakness Yes P
1147005 2024-001 Material Weakness Yes P
1147006 2024-001 Material Weakness Yes P
1147007 2024-001 Material Weakness Yes P
1147008 2024-001 Material Weakness Yes P
1147009 2024-001 Material Weakness Yes P
1147010 2024-001 Material Weakness Yes P
1147011 2024-001 Material Weakness Yes P
1147012 2024-001 Material Weakness Yes P
1147013 2024-001 Material Weakness Yes P
1147014 2024-001 Material Weakness Yes P
1147015 2024-001 Material Weakness Yes P

Programs

ALN Program Spent Major Findings
20.205 Highway Planning and Construction $1.82M Yes 1
16.738 Edward Byrne Memorial Justice Assistance Grant Program $786,545 Yes 1
20.608 Minimum Penalties for Repeat Offenders for Driving While Intoxicated $443,155 - 1
14.218 Community Development Block Grants/entitlement Grants $136,548 - 1
16.710 Public Safety Partnership and Community Policing Grants $119,948 - 1
20.939 Safe Streets and Roads for All $112,052 - 1
21.027 Coronavirus State and Local Fiscal Recovery Funds $69,080 - 1
97.067 Homeland Security Grant Program $51,830 - 1
20.616 National Priority Safety Programs $28,887 - 1

Contacts

Name Title Type
JSSRWCN1S4C7 Janet Franco Auditee
9098208065 Calvin Kunkel Auditor
No contacts on file

Notes to SEFA

Title: A. Scope of Presentation Accounting Policies: NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES APPLICABLE TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS A. Scope of Presentation The accompanying schedule presents only the expenditures incurred by the City of Rialto, California, that are reimbursable under federal programs of federal financial assistance. For the purposes of this schedule, federal awards include both federal financial assistance received directly from a federal agency, as well as federal funds received indirectly by the City from a non-federal agency or other organization. Only the portion of program expenditures reimbursable with such federal funds is reported in the accompanying schedule. Program expenditures in excess of the maximum federal reimbursement authorized or the portion of the program expenditures that were funded with state, local or other non-federal funds are excluded from the accompanying schedule. B. Basis of Accounting The expenditures included in the accompanying schedule were reported on the modified accrual basis of accounting. Under the modified accrual basis of accounting, expenditures are incurred when the City becomes obligated for payment as a result of the receipt of the related goods and services. Expenditures reported included any property or equipment acquisitions incurred under the federal program. The City has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The City has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The accompanying schedule presents only the expenditures incurred by the City of Rialto, California, that are reimbursable under federal programs of federal financial assistance. For the purposes of this schedule, federal awards include both federal financial assistance received directly from a federal agency, as well as federal funds received indirectly by the City from a non-federal agency or other organization. Only the portion of program expenditures reimbursable with such federal funds is reported in the accompanying schedule. Program expenditures in excess of the maximum federal reimbursement authorized or the portion of the program expenditures that were funded with state, local or other non-federal funds are excluded from the accompanying schedule.
Title: B. Basis of Accounting Accounting Policies: NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES APPLICABLE TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS A. Scope of Presentation The accompanying schedule presents only the expenditures incurred by the City of Rialto, California, that are reimbursable under federal programs of federal financial assistance. For the purposes of this schedule, federal awards include both federal financial assistance received directly from a federal agency, as well as federal funds received indirectly by the City from a non-federal agency or other organization. Only the portion of program expenditures reimbursable with such federal funds is reported in the accompanying schedule. Program expenditures in excess of the maximum federal reimbursement authorized or the portion of the program expenditures that were funded with state, local or other non-federal funds are excluded from the accompanying schedule. B. Basis of Accounting The expenditures included in the accompanying schedule were reported on the modified accrual basis of accounting. Under the modified accrual basis of accounting, expenditures are incurred when the City becomes obligated for payment as a result of the receipt of the related goods and services. Expenditures reported included any property or equipment acquisitions incurred under the federal program. The City has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The City has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The expenditures included in the accompanying schedule were reported on the modified accrual basis of accounting. Under the modified accrual basis of accounting, expenditures are incurred when the City becomes obligated for payment as a result of the receipt of the related goods and services. Expenditures reported included any property or equipment acquisitions incurred under the federal program. The City has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance.

Finding Details

Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.
Finding 2024-001
Finding 2024-001: Timeliness of Financial Reporting (Material Weakness/Noncompliance) Condition: The City did not complete the financial close and reporting process in a timely manner, resulting in a delay in the submission of the audited financial statements and the single audit report to the federal awarding agencies. The City’s financial statements and the single audit report were due on March 31, 2025, as required by the Uniform Guidance. However, the information and documentation, including the trial balance, provided to the external auditors required multiple corrections and revisions to balance and audit, and therefore, the audited financial statements and the single audit report were not issued until past the required deadline. Criteria: According to the Uniform Guidance, §200.508, non-federal entities that expend $750,000 or more in a year in federal awards must have a single audit conducted for that year in accordance with the provisions of this part. The audit must be completed, and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. The Uniform Guidance also requires non-federal entities to submit their audited financial statements to the federal awarding agencies within the same time frame. Cause of Condition: The cause of the condition was the lack of management oversight and internal controls over the financial close and reporting process. Turnover at key positions within the Finance Department did not allow for the timely preparation and review of the financial statements and the SEFA. Key information required to be audited also needed multiple corrections, revisions, and versions to be suitable for audit purposes, including the trial balance and bank reconciliations which added to the time necessary to complete the audit. Effect or Potential Effect of Condition: The effect of the condition was the noncompliance with the Uniform Guidance and there exists the potential loss of federal funding. The City risks sanctions from the federal awarding agencies, such as withholding of payments, suspension or termination of awards, or disallowance of costs. Recommendation: We recommend that the City: - Review and update its policies and procedures for the financial close and reporting process to ensure compliance with the GAAP and the Uniform Guidance. - Assess its staffing and resource needs and allocate sufficient personnel and funds to perform the financial close and reporting process efficiently and effectively. - Maintain accurate and complete records and reconciliations of the various general ledger accounts and ensure that they are consistent with the financial statements and the SEFA. - Develop and implement a realistic timeline for the financial close and reporting process and monitor the progress regularly. - Communicate and coordinate with the external auditors throughout the audit process and respond to their requests promptly and accurately. Management’s Response and Corrective Action: The City acknowledges that the financial information and documentation, including the trial balance, was not prepared in a timely manner. This prevented the auditors from completing the audit, and the Single Audit, by March 31, 2025. The implementation of the new financial software system, which went live on July 1, 2023, necessitated almost all of the Finance Department’s staff hours to be allocated to ensuring the software system was accurate in its financial reporting. This allocation of resources prevented the City from producing timely financial information.