FAC Explorer

Audit 47297

FY End
2022-09-30
Total Expended
$3.66M
Findings
4
Programs
15
Organization: City of Oxford, Alabama (AL)
Year: 2022 Accepted: 2023-06-29
Auditor: Kemp & Associates CPA PC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
46692 2022-001 Significant Deficiency - L
46693 2022-002 Significant Deficiency - M
623134 2022-001 Significant Deficiency - L
623135 2022-002 Significant Deficiency - M

Programs

ALN Program Spent Major Findings
21.027 Coronavirus State and Local Fiscal Recovery Funds $2.76M Yes 2
97.047 Pre-Disaster Mitigation $145,716 - 0
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $92,980 - 0
23.002 Appalachian Area Development $70,000 - 0
20.205 Highway Planning and Construction $54,937 - 0
97.067 Homeland Security Grant Program $48,000 - 0
20.616 National Priority Safety Programs $28,760 - 0
45.310 Grants to States $22,950 - 0
16.U03 Narcotic Task Force (ntf) Drug Enforcement Agency (dea) $16,350 - 0
16.U02 US Marshalls Fugitive Task Force $11,317 - 0
93.044 Special Programs for the Aging_title Iii, Part B_grants for Supportive Services and Senior Centers $9,159 - 0
20.600 State and Community Highway Safety $4,549 - 0
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $4,491 - 0
16.U01 Organized Crime Drug Enforcement Task Force (ocdetf) $3,255 - 0
16.609 Project Safe Neighborhoods $427 - 0

Contacts

Name Title Type
NQZHXN4MFDJ4 Aimee Birchfield Auditee
2568356130 Phillip E. Bain, CPA Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of the City of Oxford, Alabama (the City) under programs of the federal government for the year ended September 30, 2022. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniformed Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the City, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the City.
Title: Assistance Listing Number Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The Assistance Listing Numbers included in the accompanying Schedule were determined based on the federal program name, review of grant contract information, and the U.S. General Services Administrations SAM.gov website.
Title: Disbursements to Subrecipients Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. Federal funds are determined to be expended when the organization become obligated to the subrecipient for payment. The city recognized the expenditure at the time the payment was made to the subrecipient.During the fiscal year ended September 30, 2022, disbursements were made to The Health Care Authority of the City of Oxford, Alabama, a component unit of the City, from the following grant program:Program:Coronavirus State and Local Recovery Funds CFDA Number: 21.027Disbursement $ 1,754,068During the fiscal year ended September 30, 2022, disbursements were made to The Water Works and Sewer Board of the City of Oxford, Alabama, a component unit of the City, from the following grant program:Program:Coronavirus State and Local Recovery Funds CFDA Number: 21.027Disbursement $ 1,000,000

Finding Details

Finding 2022-001
Criteria: The US Department of Treasury requires metropolitan cities with fewer than 250,000 residents and allocation of less than $10 million in Coronavirus State and Local Recovery Funds (SLFRF) to annually submit Form 4850 Project and Expenditure Report. The Project and Expenditure Report reports on financial data, projects funded, expenditures, and contracts and subawards over $50,000, and other information. For each project reported on the Project and Expenditure, a project expenditure category is selected. Condition: Of the two Project and Expenditure Report tested, we noted that for every project, the project expenditure category of Revenue Replacement was selected. Projects included on the reports included subawards to subrecipients. Per Final Rule FAQ 13.14, ?Treasury is not collecting subaward data for projects categorized under Expenditure Category Group 6 ?Revenue Replacement.? Treasury has determined that there are no subawards under this eligible use category. The definition of subrecipient in the Uniform Guidance provides that a subaward is provided for the purpose of ?carrying out? a portion of a federal award. Recipients? use of revenue loss funds does not give rise to subrecipient relationships given that there is no federal program or purpose to carry out in the case of the revenue loss portion of the award.? Cause: No policies and procedures are in place for the preparation and review of interim, quarterly, and annual reports. Effect: The City?s annual Project and Expenditure Reports did not report accurate information regarding the program expenditure categories for the periods March 3, 2021 through March 31, 2022 and April 1, 2022 through March 31, 2023.
Finding 2022-002
Criteria: According to ? 200.303 Internal controls of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. According to ? 200.332 Requirements for pass-through entities of 2 CFR Part 200, all pass-through entities must: ? Evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. ? Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. ? Verify that every subrecipient is audited as required by Subpart F of this part when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in ? 200.501. ? Consider whether the results of the subrecipient's audits, on-site reviews, or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records. Condition: During our testing, it was noted that the City did not follow federal subrecipient monitoring regarding evaluating the subrecipients risk of noncompliance and performing monitoring activities which includes on-site reviews and audits, follow-up audits, review of financial and performance reports, and keeping written documentation of monitoring activities and written corrective action plans. The risk assessment of subrecipients? risk of noncompliance was done informally and without written documentation. The City did not perform any monitoring activities and management regulation on subrecipients. Auditing procedures were expanded to included testing subrecipients for allowed and unallowed activities; allowable cost and cost principles; period of performance; and procurement, suspension, and debarment. During our testing, we noted that for one subrecipient tested, documentation supporting the expenditure was missing for 3 of 63 transactions tested. Cause: The City lacks policies and procedures regarding preforming monitoring activities on subrecipients. Effect: Lack of policies and procedures did not ensure that the subrecipients of the Coronavirus State and Local Fiscal Recovery Funds were properly monitored.
Finding 2022-001
Criteria: The US Department of Treasury requires metropolitan cities with fewer than 250,000 residents and allocation of less than $10 million in Coronavirus State and Local Recovery Funds (SLFRF) to annually submit Form 4850 Project and Expenditure Report. The Project and Expenditure Report reports on financial data, projects funded, expenditures, and contracts and subawards over $50,000, and other information. For each project reported on the Project and Expenditure, a project expenditure category is selected. Condition: Of the two Project and Expenditure Report tested, we noted that for every project, the project expenditure category of Revenue Replacement was selected. Projects included on the reports included subawards to subrecipients. Per Final Rule FAQ 13.14, ?Treasury is not collecting subaward data for projects categorized under Expenditure Category Group 6 ?Revenue Replacement.? Treasury has determined that there are no subawards under this eligible use category. The definition of subrecipient in the Uniform Guidance provides that a subaward is provided for the purpose of ?carrying out? a portion of a federal award. Recipients? use of revenue loss funds does not give rise to subrecipient relationships given that there is no federal program or purpose to carry out in the case of the revenue loss portion of the award.? Cause: No policies and procedures are in place for the preparation and review of interim, quarterly, and annual reports. Effect: The City?s annual Project and Expenditure Reports did not report accurate information regarding the program expenditure categories for the periods March 3, 2021 through March 31, 2022 and April 1, 2022 through March 31, 2023.
Finding 2022-002
Criteria: According to ? 200.303 Internal controls of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. According to ? 200.332 Requirements for pass-through entities of 2 CFR Part 200, all pass-through entities must: ? Evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. ? Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. ? Verify that every subrecipient is audited as required by Subpart F of this part when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in ? 200.501. ? Consider whether the results of the subrecipient's audits, on-site reviews, or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records. Condition: During our testing, it was noted that the City did not follow federal subrecipient monitoring regarding evaluating the subrecipients risk of noncompliance and performing monitoring activities which includes on-site reviews and audits, follow-up audits, review of financial and performance reports, and keeping written documentation of monitoring activities and written corrective action plans. The risk assessment of subrecipients? risk of noncompliance was done informally and without written documentation. The City did not perform any monitoring activities and management regulation on subrecipients. Auditing procedures were expanded to included testing subrecipients for allowed and unallowed activities; allowable cost and cost principles; period of performance; and procurement, suspension, and debarment. During our testing, we noted that for one subrecipient tested, documentation supporting the expenditure was missing for 3 of 63 transactions tested. Cause: The City lacks policies and procedures regarding preforming monitoring activities on subrecipients. Effect: Lack of policies and procedures did not ensure that the subrecipients of the Coronavirus State and Local Fiscal Recovery Funds were properly monitored.