Audit 378888

2025-002 Duplicate Draws of Expenditures Identification of Federal Program: Coronavirus State and Local Fiscal Recovery Funds – Assistance Listing No. 21.027. Criteria: Uniform Guidance (Subpart E, §200.403) requires that costs not be included as a cost of any other federally financed program. Condition: During our testing of the City’s major federal programs, it was discovered that two (2) of the same expenditures were drawn and/or charged to two separate funding sources: the Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) duplicated expenditures drawn on the Drinking Water State Revolving Fund (DWSRF). While each grantor has its own internal auditing of payments requested and sent to the City, the different grantors would not necessarily know if an expenditure was drawn from a different grant than those under its purview. Context/Cause: In the current fiscal year, the City utilized two federal funding sources to supplement project costs within its Water and Sewer Fund. An error occurred in tracking draws and costs charged to the project amongst the funding sources. Effects: As a result, the City recorded more funding than expended within the ARPA Fund and the SEFA. A net audit adjustment for $168,743 was required to accurately report CSLFRF revenues and expenditures within the ARPA Fund and on the SEFA. Questioned Costs: Known questioned costs amounted to $168,743. Recommendation: We recommend the City’s Finance Department implement and/or strengthen internal controls surrounding the review of draws and implement procedures, such as designation of an individual within the City with the responsibility to oversee all program draw requests to ensure that no amounts are duplicated and submitted to the grant agencies. Auditee’s Response: We concur with the finding. The City will ensure that controls are in place to prevent recording duplicate expenditures