Audit 415584

U.S. Department of Treasury Passed-Through Burleigh County COVID-19 Coronavirus State and Local Fiscal Recovery Funds Federal Financial Assistance Listing No. 21.027 Procurement and Suspension & Debarment Material Weakness in Internal Controls over Compliance Criteria – Uniform Guidance and 2 CFR sections 200.318 through 200.326 set forth the procurement standards non-federal entities other than states must follow when operating federal programs and the procurement procedures required. Condition – In our testing of procurement and suspension & debarment, it was identified that the District did not include Buy America provisions in three contracts. Cause – Lack of oversight, awareness, or understanding of all of the specific requirements under the Uniform Guidance and applicable CFR sections and controls were not adequately designed to ensure compliance with all of these requirements. Effect – Failure to properly procure services may result in noncompliance with the provisions of applicable requirements of federal programs. Questioned Costs – None reported Context/Sampling – Three out of three vendors were selected for testing. Repeat Finding from Prior Year(s) – Yes Recommendation – Management should implement written policy procedures to ensure they are properly procuring services that comply with the provisions of applicable requirements of federal programs. Views of Responsible Officials – There is no disagreement with the finding. The District is in the process of reviewing its procurement practices. Coordination with Burleigh County will continue to ensure compliance and proper documentation of procurement activities.

U.S. Department of Treasury Passed-Through Burleigh County COVID-19 Coronavirus State and Local Fiscal Recovery Funds Federal Financial Assistance Listing No. 21.027 Procurement and Suspension & Debarment Material Weakness in Internal Controls over Compliance Criteria – Uniform Guidance and 2 CFR sections 200.318 through 200.326 set forth the procurement standards non-federal entities other than states must follow when operating federal programs and the procurement procedures required. Condition – In our testing of procurement and suspension & debarment, it was identified that the District did not have a written policy on procurement that satisfied the requirements of 2 CFR sections 200.318 through 200.326. Cause – Lack of oversight, awareness, or understanding of all of the specific requirements under the Uniform Guidance and applicable CFR sections and controls were not adequately designed to ensure compliance with all of these requirements. Effect – A lack of documented policies increases the overall risk that employees are not aware of the specific requirements with contracting and awarding contracts to lower-tier entities. Questioned Costs – None reported Context/Sampling – N/A Repeat Finding from Prior Year(s) – Yes Recommendation – We recommend that management establish a written policy that addresses all of the procurement requirements for federal programs as identified in 2 CFR sections 200.318 through 200.326 and maintain adequate supporting documentation and records to document history and methods of procurement and the procedures performed to comply with these CFR sections. Views of Responsible Officials – There is no disagreement with the finding. The District is in the process of reviewing its procurement practices. Coordination with Burleigh County will continue to ensure compliance and proper documentation of procurement activities.

Federal Agency: N/A Assistance Listing Number: N/A Reporting Material Weakness in Internal Controls over Compliance Criteria – 2 CFR 200.510(b) requires the auditee to prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the auditee's financial statements. The SEFA must be complete and accurately present federal expenditures and other required information. Condition – During the testing of the SEFA, it was determined that federal expenditures included on the 2024 and 2025 SEFA’s were incorrectly stated for the Coronavirus State and Local Fiscal Recovery Funds program. The District incorrectly included $113,400 of federal expenditures in 2024’s SEFA that should have been included in 2023’s SEFA. The District incorrectly omitted $175,263 of federal expenditures in 2024’s SEFA. Both of these errors relate to the Coronavirus State and Local Fiscal Recovery Funds program. Cause – Management's review controls over the preparation of the SEFA were not sufficiently designed or operating effectively to ensure that all federal expenditures were appropriately reported on the SEFA in the correct fiscal year. Effect – Inaccurate preparation of the SEFA may result in incorrect federal programs being audited. Questioned Costs – None reported Context/Sampling – The omitted expenditures in 2024’s SEFA totaling $175,263 represented approximately 14% of total expenditures reported on the SEFA in 2024. Repeat Finding from Prior Year(s) – No Recommendation – We recommend a review of the control process over the SEFA take place to determine that the SEFA is being presented correctly in the audited financial statements. Views of Responsible Officials – The District will review the SEFA thoroughly to ensure that expenditures are included in the appropriate fiscal year.