Audit 400324

2025-004 Reporting ALN 21.027 Coronavirus State and Local Fiscal Funds US Department of the Treasury Fiscal Year 2025 Funding Grant Y5314 Criteria: 2 CFR 200.303 requires non-federal entities to establish and maintain effective internal controls. Reports should be subject to independent review to verify completeness, validity, and timeliness of submission. Condition: The City’s controls over reports issued to U.S. Treasury failed to operate correctly as the underlying data contained errors which were noted on the report issued to the US Treasury. Cause of the condition: The City did not have a proper review of the underlying data for the reports sent to the US Treasury as the underlying data caused the reports to be incorrect. Potential effect of condition: Reports submitted could contain errors or could be incomplete. Questioned costs: None noted. Reported finding is a deficiency in internal control. Recommendation: The City should review the underlying data along with the report to ensure the report agrees with the support and the underlying data is correct. Management Response: Management recognizes the importance of accurate and complete reporting to the U.S. Treasury. While procedures were in place, the review of underlying data was not sufficient to ensure accuracy and completeness prior to submission. The issue was limited to a single report and was corrected in the subsequent U.S. Treasury reporting cycle in accordance with program requirements. To prevent recurrence, management has enhanced its review procedures over grant reporting to include reconciliation of underlying data and validation checks for inconsistencies prior to report submission. Additionally, a secondary level of review will be performed to ensure reports are complete and accurate before submission to the U.S. Treasury.

2025-003 Suspension and Debarment ALN 21.027 Coronavirus State and Local Fiscal Funds US Department of the Treasury Fiscal Year 2025 Funding Criteria: CFR 180.300 requires the City to ensure vendors and contractors are not disqualified, excluded, or debarred prior to entering into a covered transaction. Per 2 CFR 200.303 requires non-federal entities to establish and maintain effective internal controls. The City should have a process to ensure compliance with 2 CFR 180.300. Condition: The City did not have documented controls over the review of verifying vendors are not debarred or suspended. Cause of the condition: The City completes SAM checks of all vendors however, the City does not have a review process to verify the vendor is not suspended or debarred before a contract or payment with the vendor. Potential effect of condition: The City may have covered transactions with federally debarred vendors. Questioned Costs: None noted. Reported finding is a deficiency in internal control. Recommendation: The City should put controls in place to verify SAM checks before authorizing a contract or a purchase order with a vendor for a covered transaction. Management Response: Management recognizes the importance of compliance with federal suspension and debarment requirements. Management has implemented procedures to ensure compliance with suspension and debarment requirements for federally funded transactions. As part of the procurement process, vendors responding to solicitations for grant-funded projects will be required to provide evidence of active SAM registration and certify that they are not suspended or debarred. In addition, prior to execution of contracts or issuance of purchase orders for covered transactions, management will perform and document an independent SAM.gov verification as part of standard pre-award procedures to confirm vendor eligibility.