FAC Explorer

Audit 362042

FY End
2024-12-31
Total Expended
$10.41M
Findings
2
Programs
11
Organization: City of Durango (CO)
Year: 2024 Accepted: 2025-07-11
Auditor: Eide Bailly LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
571139 2024-001 Significant Deficiency - I
1147581 2024-001 Significant Deficiency - I

Programs

ALN Program Spent Major Findings
20.106 Airport Improvement Program, Infrastructure Investment and Jobs Act Programs, and Covid-19 Airports Programs $1.78M - 0
15.524 Recreation Resources Management $951,900 Yes 0
20.509 Formula Grants for Rural Areas and Tribal Transit Program $860,654 Yes 1
20.526 Fta Buses & Bus Facilities Grant $448,080 - 0
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $366,988 - 0
66.468 Lead Service Line Replacement Program $182,250 - 0
21.027 Coronavirus State and Local Fiscal Recovery Funds $81,912 Yes 0
20.513 Transit Services Program Cluster $76,471 - 0
15.228 Blm Fuels Management and Community Fire Assistance Program Activities $29,840 - 0
20.600 State and Community Highway Safety $17,628 - 0
93.575 Child Care and Development Block Grant $12,023 - 0

Contacts

Name Title Type
HD9AHTKKNBN8 Heidi Wise Auditee
9703755039 Paul Kane Auditor
No contacts on file

Notes to SEFA

Title: Note A - Basis of Presentation Accounting Policies: Expenditures reported in the schedule are reported on the modified accrual basis of accounting, except for 1) expenditures received from the Federal Aviation Administration (FAA) which are reported on the accrual basis of accounting, and 2) subrecipient expenditures, which are recorded on the cash basis. When applicable, such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited to reimbursement. De Minimis Rate Used: N Rate Explanation: The City does not draw for indirect administrative expenses and has not elected to use the 10% de minimus cost rate. The accompanying schedule of expenditures of federal awards (the schedule) includes federal award activity of the City of Durango, Colorado (the City) under programs of the federal government for the year ended December 31, 2024. The information 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 selected portion of the operations of the City, it is not intended to and does not present the financial position, changes in net position / fund balance, or cash flows of the City.
Title: Note B – Summary of Significant Accounting Policies Accounting Policies: Expenditures reported in the schedule are reported on the modified accrual basis of accounting, except for 1) expenditures received from the Federal Aviation Administration (FAA) which are reported on the accrual basis of accounting, and 2) subrecipient expenditures, which are recorded on the cash basis. When applicable, such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited to reimbursement. De Minimis Rate Used: N Rate Explanation: The City does not draw for indirect administrative expenses and has not elected to use the 10% de minimus cost rate. Expenditures reported in the schedule are reported on the modified accrual basis of accounting, except for 1) expenditures received from the Federal Aviation Administration (FAA) which are reported on the accrual basis of accounting, and 2) subrecipient expenditures, which are recorded on the cash basis. When applicable, such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited to reimbursement.
Title: Note C – Indirect Cost Rate Accounting Policies: Expenditures reported in the schedule are reported on the modified accrual basis of accounting, except for 1) expenditures received from the Federal Aviation Administration (FAA) which are reported on the accrual basis of accounting, and 2) subrecipient expenditures, which are recorded on the cash basis. When applicable, such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited to reimbursement. De Minimis Rate Used: N Rate Explanation: The City does not draw for indirect administrative expenses and has not elected to use the 10% de minimus cost rate. The City does not draw for indirect administrative expenses and has not elected to use the 10% de minimus cost rate.

Finding Details

Finding 2024-001
Finding 2024-001 Federal Program: Formula Grants for Rural Areas and Tribal Transit Assistance Listing Number: 20.509 Compliance Requirement: Procurement and Suspension and Debarment Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: Per 2 CFR §200.318(i), non-Federal entities must maintain records sufficient to detail the history of procurement, including the rationale for the method of procurement and the basis for contractor selection. For sole source procurements, 2 CFR §200.320(c) outlines specific conditions under which noncompetitive procurement is allowable and requires written justification. Additionally, 2 CFR §200.303 requires non-Federal entities to establish and maintain effective internal control over federal awards that provides reasonable assurance that the entity is managing the award in compliance with federal statutes, regulations, and the terms and conditions of the award. Condition: During our review of procurement procedures, we noted that the entity selected a sole source vendor but did not maintain documentation supporting the justification for the noncompetitive procurement. While the procurement itself did not violate Uniform Guidance requirements, the absence of supporting documentation indicates a weakness in internal controls over procurement recordkeeping. Cause: Although the entity has established procedures for documenting sole source procurement decisions, those procedures were not followed in this instance. This appears to have been an isolated oversight rather than a systemic issue. Effect: Although the procurement may have met the criteria for a sole source, the lack of documentation limits transparency and may hinder the entity’s ability to demonstrate compliance in future audits. Repeat Finding from Prior Year: No Recommendation: We recommend that management strengthen internal controls over procurement documentation by implementing procedures to ensure that all sole source procurements are supported by written justifications and retained in accordance with Uniform Guidance requirements. Views of Responsible Officials: Management agrees with the finding.
Finding 2024-001
Finding 2024-001 Federal Program: Formula Grants for Rural Areas and Tribal Transit Assistance Listing Number: 20.509 Compliance Requirement: Procurement and Suspension and Debarment Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: Per 2 CFR §200.318(i), non-Federal entities must maintain records sufficient to detail the history of procurement, including the rationale for the method of procurement and the basis for contractor selection. For sole source procurements, 2 CFR §200.320(c) outlines specific conditions under which noncompetitive procurement is allowable and requires written justification. Additionally, 2 CFR §200.303 requires non-Federal entities to establish and maintain effective internal control over federal awards that provides reasonable assurance that the entity is managing the award in compliance with federal statutes, regulations, and the terms and conditions of the award. Condition: During our review of procurement procedures, we noted that the entity selected a sole source vendor but did not maintain documentation supporting the justification for the noncompetitive procurement. While the procurement itself did not violate Uniform Guidance requirements, the absence of supporting documentation indicates a weakness in internal controls over procurement recordkeeping. Cause: Although the entity has established procedures for documenting sole source procurement decisions, those procedures were not followed in this instance. This appears to have been an isolated oversight rather than a systemic issue. Effect: Although the procurement may have met the criteria for a sole source, the lack of documentation limits transparency and may hinder the entity’s ability to demonstrate compliance in future audits. Repeat Finding from Prior Year: No Recommendation: We recommend that management strengthen internal controls over procurement documentation by implementing procedures to ensure that all sole source procurements are supported by written justifications and retained in accordance with Uniform Guidance requirements. Views of Responsible Officials: Management agrees with the finding.