Audit 368237

Finding 2024-002 AL No.: 21.027 Program Title: COVID-19 Coronavirus State and Local Fiscal Recovery Funds Federal Agency: U.S. Department of Treasury Award Number/Year: 1505-0271 / 2021 Criteria: The Uniform Guidance requires that local entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with laws, regulations, and program compliance requirements. The Uniform Guidance further requires auditors to obtain an understanding of the local entity's internal control over federal programs. To minimize the risk of errors, internal controls should be in place for all program compliance requirements, including the preparation and submission of financial reports, which should be reviewed and approved by a responsible party other than the original preparer before they are submitted to the granting agency. Condition and Context: A sample of one annual P&E report was selected for testing. There was no documentation available to support that the report was reviewed and approved by an individual separate from the preparer prior to submission. This sample was not statistically valid. Cause: The City does not have procedures in place requiring an independent person to review the reports before submission. Effect: Reports could be submitted that contain errors, or reports may not be submitted within the allowed reporting periods. Questioned Costs: None noted. Recommendation: We recommend that an employee other than the preparer review all reports before they are submitted to the Department of Treasury and documentation of the review be retained. Management's Response: The Finance Department will have a staff member initial and review the final report before it is submitted on the Department of Treasury website. This will be corrected right away in September 2025 for future reports being filed.

Finding 2024-003 AL No.: 66.468 Program Title: Drinking Water State Revolving Fund Federal Agency: U.S. Environmental Protection Agency Pass-Through Agency: Wisconsin Department of Natural Resources Award Number/Year: Unknown / 2024 Criteria: The Uniform Guidance requires in 2 CFR section 200.318(h) that entities receiving federal awards verify the suspension and debarment status of vendors before procurement takes place. Condition and Context: During testing, it was noted that the City did not document its review of suspension and debarment for both of the vendors tested for the federal program. Our sample was not statistically valid. Cause: The City did not complete and document the review of suspended and debarred vendors as required for expenditures of federal awards in accordance with the Uniform Guidance. Effect: If transactions occur with a suspended or debarred vendor, the funding agency may disallow the costs associated with the transaction. Questioned Costs: None noted. Recommendation: We recommend that the City complete and document the review for suspended and debarred vendors as required for expenditures of federal awards in accordance with Uniform Guidance before contracting with a vendor. Management's Response: The City did not perform a review for suspended and debarred vendors. Neither we, nor our engineering firm, had prior knowledge of this requirement and were not informed by the State of Wisconsin to conduct such a review. Moving forward, the Utilities Department will work with our engineering firm to conduct a review for suspended and debarred vendors prior to contracting with a specific vendor. We will implement this protocol as of September 15, 2025.