Audit 406953

The Municipality did not maintain effective internal control over compliance for the CSLFRF program. Specifically, the Municipality had not formally adopted policies adequately addressing federally funded activities, and procurement-related controls at the municipal level were ineffective. Additionally, documentation available for audit did not consistently evidence an appropriate municipal review of the project ledger and related pay applications. Audit procedures identified coding and recording errors that resulted in material adjustments for annual report and audit presentation, indicating that review controls were not operating effectively. Although SECOG compiled invoices and prepared pay applications, the Municipality did not evidence the performance of a sufficient oversight or review control to detect and correct errors on a timely basis. Further, during the audit, support had to be obtained from SECOG to determine whether certain procedures had been performed, indicating that the Municipality was not consistently maintaining complete grant administration records. These control deficiencies were systemic in nature and not limited to isolated transactions. The deficiency affected all items tested, which represented approximately 99% of the total dollar value of grant expenditures.