Audit 410701

Disaster Grants – Public Assistance (Presidentially Declared Disasters) Assistance Listing No. 97.036 US Department of Homeland Security Federal Award Year: 2023 Criteria - In accordance with 2 CFR § 200.403 and 2 CFR § 200.309, costs charged to a federal award must be incurred during the approved period of performance unless otherwise authorized by the awarding agency Condition - During our testing of period of performance, we noted that one transaction occurred prior to the period of performance beginning Cause - Proper accounting policies and procedures were not in place related to review of documentation related to the period of performance Effect or Potential Effect - Federal funds may be used to reimburse expenditures that are not eligible under the terms and conditions of the award, resulting in noncompliance with federal requirements Questioned Costs - $7,727 Context - One of the seventeen payroll transactions tested (6%) was determined to be outside the period of performance. This represents $456 of the $29,919 sampled costs. The sampling methodology used is not, and is not intended to be, statistically valid. Identification as a repeat finding - No Recommendation - The City should incorporate internal controls over compliance with period of performance compliance requirements Views of Responsible Officials and Planned Corrective Actions - Management concurs with the finding and is updating their internal controls around period of performance

Disaster Grants – Public Assistance (Presidentially Declared Disasters) Assistance Listing No. 97.036 US Department of Homeland Security Federal Award Year: 2023 Criteria - In accordance with 2 CFR § 200.430, compensation for personal services charged to a federal award must be based on records that accurately reflect the work performed and support the payroll costs charged to the federal program. Internal controls should ensure that payroll expenditures charged to federal awards are calculated using authorized and accurate pay rates. Condition - During our testing of payroll costs charged to ALN 97.036, we identified one instance in which employee's payroll cost was calculated using an incorrect pay rate. As a result, the payroll expenditure charged to the federal program was overstated. Cause - The City's controls over payroll cost calculations were not operating effectively to ensure payroll expenditures charged to the federal award were calculated using the correct authorized pay rate. Effect or Potential Effect - Payroll expenditures charged to the federal award may not be supported by accurate compensation records, resulting in the reimbursement of unallowable costs and noncompliance with federal requirements. Questioned Costs - $152 Context - One of the seventeen payroll transactions tested (6%) was determined to be calculated using the incorrect payrate. This represents $10 of the $29,919 sampled costs. The sampling methodology used is not, and is not intended to be, statistically valid. Identification as a repeat finding - No Recommendation - We recommend management strengthen its review procedures over payroll expenditures charged to federal awards to ensure payroll costs are calculated using approved and authorized pay rates prior to reimbursement and reporting. Views of Responsible Officials and Planned Corrective Actions - Management concurs with the finding and will enhance its payroll review procedures to verify that payroll costs charged to federal awards are calculated using the correct authorized pay rates