Audit 406491

2025-002 Audit report deadline CFDA Title: Drinking Water State Revolving Fund CFDA Number: 66.468 Federal Agency: United States Environmental Protection Agency Pass-through Entity: Montana Department of Natural Resources and Conservation Condition: Montana local governments with a June 30 fiscal year-end are required to submit audited financial statements to the Montana Department of Administration and, when applicable, the Federal Audit Clearinghouse by March 31 following year-end. The City's fiscal year 2025 audit was not completed and submitted by the required deadline. Context: During audit procedures, we reviewed applicable State of Montana and federal audit submission requirements and noted the fiscal year 2025 audit report was submitted after the required filing deadline. Criteria: Montana Administrative Rule 2.4.411 and the Uniform Guidance require audits to be completed and submitted within nine months following fiscal year-end. Effect: The City was not in compliance with required State and federal audit filing deadlines for fiscal year 2025. Cause: Additional time was required to correct and reconcile accounting records before the audit could begin. As a result, the audit was delayed and could not be completed by the required filing deadline. Recommendation: We recommend the City strengthen year-end closing and reconciliation procedures to ensure accounting records are complete and accurate prior to the start of the audit. Timely completion of these procedures will help facilitate audit completion and submission in accordance with State and federal requirements.