FAC Explorer

Audit 370259

FY End
2024-09-30
Total Expended
$5.67M
Findings
1
Programs
2
Organization: Town of Dauphin Island (AL)
Year: 2024 Accepted: 2025-10-01
Auditor: R A Headrick JR CPA LLC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
1159641 2024-003 Material Weakness Yes C

Programs

ALN Program Spent Major Findings
21.015 Resources and Ecosystems Sustainability, Tourist Opportunities, and Revived Economies of the Gulf Coast States $489,928 Yes 0
11.473 Office for Coastal Management $177,362 Yes 0

Contacts

Name Title Type
LXTYASXBFD97 Wanda Sandagger Auditee
2518615525 Robert Headrick Auditor
No contacts on file

Notes to SEFA

The accompanying Schedule of Expenditures of Federal Awards (SEFA) summarizes the federal expenditures of the Town of Dauphin Island, Alabama’s programs of the federal government for the Fiscal Year ended September 30, 2024. The amounts reported as federal expenditures were obtained from the Town of Dauphin Island, Alabama’s general ledger. The SEFA presents only a selected portion of the operations of the Town of Dauphin Island, Alabama and it is not intended to and does not present the financial position, changes in net assets, and cash flows of the Town of Dauphin Island, Alabama. For purposes of the SEFA, federal awards include all grants, contracts, and similar agreements entered into directly with the federal government and other pass-through entities. The Town of Dauphin Island, Alabama has obtained Catalog of Federal Domestic Assistance (CFDA) numbers to ensure that all programs have been identified in the SEFA. CFDA numbers have been appropriately listed by applicable programs.
The SEFA was prepared on the accrual basis of accounting.
Grant proceeds received and disbursed by the Town of Dauphin Island, Alabama are for specific purposes and are subject to audit by the grantor agencies. Such audits may result in requests for reimbursement due to disallowed expenditures. Based on prior experience, the Town of Dauphin Island, Alabama does not believe that such disallowances, if any, would have a material effect on the financial position of the Town. As of September 30, 2024, there are no material questioned or disallowed costs as a result of grant audits in process or completed.

Finding Details

Finding 2024-003
CRITERIA - As per 2 CFR 200.302 and the terms and conditions of the grant, the auditee must maintain accounting records that clearly identify the source and application of federal funds and must account for federal awards separately from other funds to ensure that federal funds are used only for authorized purposes. CONDITION - During my audit of the 2024 Program Year of the National Coastal Zone Management Program, I noted the Town of Dauphin Island deposited federal program funds into a pooled bank account with non-federal funds. Program expenditures were paid from this pooled account without a separate ledger or tracking mechanism in place at the time of the transactions. As a result, the auditee was unable to immediately identify program-specific expenditures and balances. CAUSE - The auditee did not have adequate written procedures or internal controls to ensure that federal funds were maintained in separate accounts or separately tracked within the accounting system. EFFECT - The commingling of federal and non-federal funds increases the risk that federal funds could be used for unallowable purposes, could result in unallowable costs being charged to the grant, and makes timely and accurate financial reporting more difficult. Although I was ultimately able to determine the allowable costs after significant additional procedures, the lack of separate accounting records represents a weakness in internal controls over compliance. QUESTIONED COSTS - None identified. REPEAT FINDING - No. RECOMMENDATION - I recommend the Town of Dauphin Island establish procedures to ensure that federal funds are either maintained in a separate bank account or are tracked separately in the general ledger through the use of grant-specific accounts or cost centers. Federal program transactions should be clearly identified to facilitate effective monitoring of federal grant proceeds and expenditures and timely and accurate financial reporting.