FAC Explorer

Audit 4130

FY End
2023-06-30
Total Expended
$10.92M
Findings
2
Programs
5
Organization: Town of Cary (NC)
Year: 2023 Accepted: 2023-11-27
Auditor: Cherry Bekaert LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
2403 2023-001 Significant Deficiency - L
578845 2023-001 Significant Deficiency - L

Programs

ALN Program Spent Major Findings
21.027 Coronavirus State and Local Fiscal Recovery Funds $3.56M Yes 1
20.507 Federal Transit_formula Grants $2.92M - 0
20.205 Highway Planning and Construction $848,349 - 0
14.218 Community Development Block Grants/entitlement Grants $656,150 - 0
16.922 Equitable Sharing Program $67,682 - 0

Contacts

Name Title Type
LTWPZ97EE8P2 Jessica Murphy Rhem Auditee
9194623955 April Adams Auditor
No contacts on file

Notes to SEFA

Title: Note 1- GENERAL Accounting Policies: The accompanying Schedule of Expenditures of Federal and State Awards is presented using the modified accrual basis of accounting, which is described in the notes to the Town's basic financial statements. Expenditures are recognized following the cost principles contained in the Uniform Guidance and the State Single Audit Implementation Act, wherein certain types of expenditures are not allowable or limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: Cary has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. The accompanying Schedule of Expenditures of Federal and State Awards (the Schedule) presents the activity of all federal and state financial award programs of Cary, North Carolina. All federal and state financial awards received directly from federal and state agencies as well as federal financial awards passed through other government agencies are included on the schedule. The information is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards and the State Single Audit Implementation Act. The Schedule presents only a selected portion of the operations of Cary, it is not intended to and does not present the financial position, changes in net assets, or cash flows of Cary.
Title: Note 3- RELATIONSHIP TO BASIC FINANCIAL STATEMENTS Accounting Policies: The accompanying Schedule of Expenditures of Federal and State Awards is presented using the modified accrual basis of accounting, which is described in the notes to the Town's basic financial statements. Expenditures are recognized following the cost principles contained in the Uniform Guidance and the State Single Audit Implementation Act, wherein certain types of expenditures are not allowable or limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: Cary has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. a) State award revenues for Powell Bill of $4.7 million are reported in Cary's basic financial statements in the Capital Project Funds. At June 30, 2023, $7.8 million of unexpended Powell Bill Funds is included in the Capital Project Fund’s fund balance as Restricted for Street Projects. The activity in this account for the year ended June 30, 2023 is as follows: See notes to SEFSA for the chart/table.
Title: Note 4- PRIOR YEAR EXPENDITURES Accounting Policies: The accompanying Schedule of Expenditures of Federal and State Awards is presented using the modified accrual basis of accounting, which is described in the notes to the Town's basic financial statements. Expenditures are recognized following the cost principles contained in the Uniform Guidance and the State Single Audit Implementation Act, wherein certain types of expenditures are not allowable or limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: Cary has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. Where allowed by grant agreement, prior year expenditures that have not been previously tested may be included in the Schedule of Awards at June 30, 2023. Generally this occurs when grants are awarded after the related project or program has started incurring expenses and retroactive reimbursement is allowed per the funding agreement or when corrections are made due to previous year(s) omissions.

Finding Details

Finding 2023-001
Finding 2023-001 Federal Agency: U.S. Department of Treasury Federal Program: Coronavirus State and Lical Fiscal Recovery Funds ALN: 21.027 Compliance Requirement: Reporting Type of Finding: Significant Deficiency Repeat Find: No Criteria: Title 2 U.S. Code of Federal Regulations Section 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: During testing of the Coronavirus State and Local Fiscal Recovery Funds reporting compliance requirement, it was noted that there was not a structured second level review process over the preparation of the report prior to being submitted to the U.S. Treasury. Context: The quarterly report that was to be submitted for the Coronavirus State and Local Fiscal Recovery program was prepared by a staff; however, it was not reviewed prior to submission. Questioned Costs: None noted. Cause: The Town did not have a structured second level review of the report prior to submission to the Treasury. Effect: Errors could be made and not detected on a timely basis and therefore, monthly and/or quarterly reports may contain errors. Recommendations: We recommend the Town implement a review process over the report prior to the submission of the report where staff prepares, and a manager reviews the report. Evidence of performance and review of these reports should be maintained. Views of Responsible Officials: Management agrees with the finding.
Finding 2023-001
Finding 2023-001 Federal Agency: U.S. Department of Treasury Federal Program: Coronavirus State and Lical Fiscal Recovery Funds ALN: 21.027 Compliance Requirement: Reporting Type of Finding: Significant Deficiency Repeat Find: No Criteria: Title 2 U.S. Code of Federal Regulations Section 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: During testing of the Coronavirus State and Local Fiscal Recovery Funds reporting compliance requirement, it was noted that there was not a structured second level review process over the preparation of the report prior to being submitted to the U.S. Treasury. Context: The quarterly report that was to be submitted for the Coronavirus State and Local Fiscal Recovery program was prepared by a staff; however, it was not reviewed prior to submission. Questioned Costs: None noted. Cause: The Town did not have a structured second level review of the report prior to submission to the Treasury. Effect: Errors could be made and not detected on a timely basis and therefore, monthly and/or quarterly reports may contain errors. Recommendations: We recommend the Town implement a review process over the report prior to the submission of the report where staff prepares, and a manager reviews the report. Evidence of performance and review of these reports should be maintained. Views of Responsible Officials: Management agrees with the finding.