Audit 44337

Federal Awards Findings 2022-001 Procurement Policy Criteria The Town received and spent federal grant funds during the year ended December 31, 2022. Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) ? 200.318 requires the Town to establish, in writing, procurement standards for use in the Town procurement (purchases) over federal grant expenditures. Condition The Town does not have written procurement (purchasing) policies and procedures for use in procuring and spending federal grant expenditures. Context During the performance of our audit procedures, we identified that the Town doesn?t have the required procurement standards in writing. Effect There is a risk that Town?s procurement of federal grant expenditures are not in compliance with the federal grant program that is funding the water system improvements project. Cause The Town?s financial activities usually do not include expenditures which are funded by federal grants. The Town?s water system improvements project is being funded by federal grant funds through a loan from the Colorado Water Resources & Power Development Authority, which is also overseen by the Colorado Department of Public Health and Environment, and through federal grants funds from the Colorado Department of Local Affairs. During the planning stages of the project and loan approval, none of these entities informed the Town of these federal requirements. Therefore, Town management was not aware of these requirements, in order to establish and approve procurement policies and procedures. Questioned Costs None. Recommendation We recommend that the Town establish and approve procurement policies and procedures for all procurement activities of the Town. View of Responsible Officials and Planned Corrective Actions See the accompanying Corrective Action Plan.

Federal Awards Findings 2022-001 Procurement Policy Criteria The Town received and spent federal grant funds during the year ended December 31, 2022. Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) ? 200.318 requires the Town to establish, in writing, procurement standards for use in the Town procurement (purchases) over federal grant expenditures. Condition The Town does not have written procurement (purchasing) policies and procedures for use in procuring and spending federal grant expenditures. Context During the performance of our audit procedures, we identified that the Town doesn?t have the required procurement standards in writing. Effect There is a risk that Town?s procurement of federal grant expenditures are not in compliance with the federal grant program that is funding the water system improvements project. Cause The Town?s financial activities usually do not include expenditures which are funded by federal grants. The Town?s water system improvements project is being funded by federal grant funds through a loan from the Colorado Water Resources & Power Development Authority, which is also overseen by the Colorado Department of Public Health and Environment, and through federal grants funds from the Colorado Department of Local Affairs. During the planning stages of the project and loan approval, none of these entities informed the Town of these federal requirements. Therefore, Town management was not aware of these requirements, in order to establish and approve procurement policies and procedures. Questioned Costs None. Recommendation We recommend that the Town establish and approve procurement policies and procedures for all procurement activities of the Town. View of Responsible Officials and Planned Corrective Actions See the accompanying Corrective Action Plan.