FAC Explorer

Audit 48461

FY End
2022-06-30
Total Expended
$8.31M
Findings
22
Programs
10
Organization: Municipality of Toa Alta (PR)
Year: 2022 Accepted: 2023-05-01
Auditor: Lopez Vega CPA Psc

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
42618 2022-008 Significant Deficiency - P
42619 2022-008 Significant Deficiency - P
42620 2022-005 Significant Deficiency Yes L
42621 2022-008 Significant Deficiency - P
42622 2022-008 Significant Deficiency - P
42623 2022-007 Significant Deficiency - I
42624 2022-008 Significant Deficiency - P
42625 2022-006 Significant Deficiency - L
42626 2022-007 Significant Deficiency - I
42627 2022-008 Significant Deficiency - P
42628 2022-008 Significant Deficiency - P
619060 2022-008 Significant Deficiency - P
619061 2022-008 Significant Deficiency - P
619062 2022-005 Significant Deficiency Yes L
619063 2022-008 Significant Deficiency - P
619064 2022-008 Significant Deficiency - P
619065 2022-007 Significant Deficiency - I
619066 2022-008 Significant Deficiency - P
619067 2022-006 Significant Deficiency - L
619068 2022-007 Significant Deficiency - I
619069 2022-008 Significant Deficiency - P
619070 2022-008 Significant Deficiency - P

Programs

ALN Program Spent Major Findings
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $773,743 Yes 1
21.019 Coronavirus Relief Fund $754,064 Yes 1
21.027 Coronavirus State and Local Fiscal Recovery Funds $643,850 Yes 3
93.575 Child Care and Development Block Grant $316,955 - 0
14.218 Community Development Block Grants/entitlement Grants $219,286 Yes 1
10.558 Child and Adult Care Food Program $27,551 - 0
14.871 Section 8 Housing Choice Vouchers $21,747 - 0
14.241 Housing Opportunities for Persons with Aids $19,605 - 0
20.505 Metropolitan Transportation Planning and State and Non-Metropolitan Planning and Research $16,682 - 0
93.044 Special Programs for the Aging_title Iii, Part B_grants for Supportive Services and Senior Centers $1,432 - 0

Contacts

Name Title Type
EELZK1K9FLZ4 Kristian Rivera Santiago Auditee
7878702100 Angel A. Lopez Vega Auditor
No contacts on file

Notes to SEFA

Title: MAJOR PROGRAMS Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal grant activity of the Municipality under programs of the federal government for the year ended June 30, 2022. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulation (CFR Part 200), Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (Uniform Guidance). Therefore, some amounts presented in this schedule may differ from the amounts presented in, or used in the preparation of, the basic financial statements. Because the schedule presents only a selected portion of the operations of the Municipality, it is not intended to, and does not present, the financial position and changes in net position of the Municipality. Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Expenditures are recognized when the related liability is incurred, following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Expenditures for the following programs are recognized based on other unique requirements: ?Section 8 Housing Choice Voucher Program (HCV): Expenditures are reported on a statutory basis as required by the U.S. Department of Housing and Urban Development. Such expenditures should equal the net ACC subsidy for the PHAs fiscal period. ?Public assistance grants (FEMA): Expenditures are recognized in the period when: (1) FEMA has approved the PW, and (2) eligible expenditures are incurred. ?Loans or loans guarantee programs: Expenditures equal the value of new loans made or received during the audit period plus the beginning of the audit period balance of outstanding loans from previous years for which the federal government imposes continuing compliance requirements. For loans with no imposed continuing compliance requirements, expenditures are recognized when the related costs financed with loan proceeds are incurred. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. Major programs are identified in the Summary of Auditors Results Section of the Schedule of Findings and Questioned Costs.
Title: SUBRECIPIENTS Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal grant activity of the Municipality under programs of the federal government for the year ended June 30, 2022. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulation (CFR Part 200), Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (Uniform Guidance). Therefore, some amounts presented in this schedule may differ from the amounts presented in, or used in the preparation of, the basic financial statements. Because the schedule presents only a selected portion of the operations of the Municipality, it is not intended to, and does not present, the financial position and changes in net position of the Municipality. Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Expenditures are recognized when the related liability is incurred, following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Expenditures for the following programs are recognized based on other unique requirements: ?Section 8 Housing Choice Voucher Program (HCV): Expenditures are reported on a statutory basis as required by the U.S. Department of Housing and Urban Development. Such expenditures should equal the net ACC subsidy for the PHAs fiscal period. ?Public assistance grants (FEMA): Expenditures are recognized in the period when: (1) FEMA has approved the PW, and (2) eligible expenditures are incurred. ?Loans or loans guarantee programs: Expenditures equal the value of new loans made or received during the audit period plus the beginning of the audit period balance of outstanding loans from previous years for which the federal government imposes continuing compliance requirements. For loans with no imposed continuing compliance requirements, expenditures are recognized when the related costs financed with loan proceeds are incurred. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. During fiscal year 2021-2022, there were no awards passed through to sub-recipients.
Title: RECONCILIATION OF EXPENDITURES PRESENTED IN THE SCHEDULE OF EXPENDITURES OF Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal grant activity of the Municipality under programs of the federal government for the year ended June 30, 2022. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulation (CFR Part 200), Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (Uniform Guidance). Therefore, some amounts presented in this schedule may differ from the amounts presented in, or used in the preparation of, the basic financial statements. Because the schedule presents only a selected portion of the operations of the Municipality, it is not intended to, and does not present, the financial position and changes in net position of the Municipality. Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Expenditures are recognized when the related liability is incurred, following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Expenditures for the following programs are recognized based on other unique requirements: ?Section 8 Housing Choice Voucher Program (HCV): Expenditures are reported on a statutory basis as required by the U.S. Department of Housing and Urban Development. Such expenditures should equal the net ACC subsidy for the PHAs fiscal period. ?Public assistance grants (FEMA): Expenditures are recognized in the period when: (1) FEMA has approved the PW, and (2) eligible expenditures are incurred. ?Loans or loans guarantee programs: Expenditures equal the value of new loans made or received during the audit period plus the beginning of the audit period balance of outstanding loans from previous years for which the federal government imposes continuing compliance requirements. For loans with no imposed continuing compliance requirements, expenditures are recognized when the related costs financed with loan proceeds are incurred. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The reconciliation between the expenditures in the fund financial statements and the expenditures in the Schedule of Expenditures of Federal Awards is as follows:Per Schedule of Expenditures of Federal Awards: $8,339,043Nonfederal programs expenditures and other adjustments: 19,554,236Total Expenditures:$27,893,279The Municipality receives FEMA reimbursement funds from the Central Office for Recovery, Reconstruction and Resiliency (COR3). COR3 is a division of the Puerto Rico Public Private Authority created through Executive Order 2017-65 to manage all efforts for the recovery of the Commonwealth of Puerto Rico (Commonwealth) after the passage of Hurricanes Irma and Maria. COR3 was authorized by the Governor to receive all disaster recovery grants of FEMA. In Fiscal Year (FY) 2022, is pending to be approved $595,097 eligible expenditures that were incurred. As of June 30, 2022, these expenditures were not included in the SEFA.
Title: ARPA - ALN 21.027 CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal grant activity of the Municipality under programs of the federal government for the year ended June 30, 2022. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulation (CFR Part 200), Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (Uniform Guidance). Therefore, some amounts presented in this schedule may differ from the amounts presented in, or used in the preparation of, the basic financial statements. Because the schedule presents only a selected portion of the operations of the Municipality, it is not intended to, and does not present, the financial position and changes in net position of the Municipality. Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Expenditures are recognized when the related liability is incurred, following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Expenditures for the following programs are recognized based on other unique requirements: ?Section 8 Housing Choice Voucher Program (HCV): Expenditures are reported on a statutory basis as required by the U.S. Department of Housing and Urban Development. Such expenditures should equal the net ACC subsidy for the PHAs fiscal period. ?Public assistance grants (FEMA): Expenditures are recognized in the period when: (1) FEMA has approved the PW, and (2) eligible expenditures are incurred. ?Loans or loans guarantee programs: Expenditures equal the value of new loans made or received during the audit period plus the beginning of the audit period balance of outstanding loans from previous years for which the federal government imposes continuing compliance requirements. For loans with no imposed continuing compliance requirements, expenditures are recognized when the related costs financed with loan proceeds are incurred. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. On March 11, 2021, was signed into law the American Rescue Plan Act (ARPA) of 2021, the latest COVID-19 stimulus package. Within ARPA, the Coronavirus State and Local Fiscal Recovery Fund provides $350 billion for states, municipalities, counties, tribes, and territories, including $130.2 billion for local governments split evenly between municipalities and counties. The Municipality of Toa Alta started receiving the funds and incurring expenditures on fiscal year 2021-2022.
Title: LATENESS OF SINGLE AUDIT REPORTING PACKAGE Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal grant activity of the Municipality under programs of the federal government for the year ended June 30, 2022. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulation (CFR Part 200), Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (Uniform Guidance). Therefore, some amounts presented in this schedule may differ from the amounts presented in, or used in the preparation of, the basic financial statements. Because the schedule presents only a selected portion of the operations of the Municipality, it is not intended to, and does not present, the financial position and changes in net position of the Municipality. Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Expenditures are recognized when the related liability is incurred, following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Expenditures for the following programs are recognized based on other unique requirements: ?Section 8 Housing Choice Voucher Program (HCV): Expenditures are reported on a statutory basis as required by the U.S. Department of Housing and Urban Development. Such expenditures should equal the net ACC subsidy for the PHAs fiscal period. ?Public assistance grants (FEMA): Expenditures are recognized in the period when: (1) FEMA has approved the PW, and (2) eligible expenditures are incurred. ?Loans or loans guarantee programs: Expenditures equal the value of new loans made or received during the audit period plus the beginning of the audit period balance of outstanding loans from previous years for which the federal government imposes continuing compliance requirements. For loans with no imposed continuing compliance requirements, expenditures are recognized when the related costs financed with loan proceeds are incurred. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The Single Audit reporting package, as defined and required in 2 CFR 200 for the fiscal year ended June 30, 2022, could not be submitted in a timely manner. From 2017 to the present, Puerto Rico has suffered four consecutive emergencies caused by nature and health situations: Hurricane Maria, Earthquakes, COVID-19, and Hurricane Fiona. The Municipality of Toa Alta has carried out emergency work and taken into consideration the waivers issued by the OMB, resulting in delays of the administrative work for the fiscal year 2021-2022.

Finding Details

Finding 2022-008
FINDING NUMBER: 2022-008 REQUIREMENT: SINGLE AUDIT ACT TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: The Single Audit Report for the fiscal year ended June 30, 2022 was not issued within nine (9) months after the end of the audit period. The Data Collection Form and the reporting package was not submitted on a timely basis. CRITERIA: The Single Audit Act, as amended, requires that the audit report must be submitted to the Federal Audit Clearinghouse no later than nine (9) months after the end of the audit period. CAUSE: The Municipality did not comply with the established regulation as prescribed in OMB Super Circular Uniform Guidance. EFFECT: The Municipality could lose federal grants due to the noncompliance with the Single Audit Act requirements. RECOMMENDATION: Procedures should be implemented to ensure that the Agency complies with the established Federal Regulation, as prescribed by OMB Super Circular Uniform Guidance. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: The fiscal year 2021-2022 Single Audit submission for Municipality of Toa Alta will be submitted through the Federal Audit Clearinghouse (FAC) no later than April 30, 2023. About the subsequent year Single Audit, we engaged the audit services on March 31, 2023, and we are going to engage the financial statements preparation consulting services on July 2023, in order to comply with fiscal year 2022-2023 Single Audit submission dateline. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-008
FINDING NUMBER: 2022-008 REQUIREMENT: SINGLE AUDIT ACT TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: The Single Audit Report for the fiscal year ended June 30, 2022 was not issued within nine (9) months after the end of the audit period. The Data Collection Form and the reporting package was not submitted on a timely basis. CRITERIA: The Single Audit Act, as amended, requires that the audit report must be submitted to the Federal Audit Clearinghouse no later than nine (9) months after the end of the audit period. CAUSE: The Municipality did not comply with the established regulation as prescribed in OMB Super Circular Uniform Guidance. EFFECT: The Municipality could lose federal grants due to the noncompliance with the Single Audit Act requirements. RECOMMENDATION: Procedures should be implemented to ensure that the Agency complies with the established Federal Regulation, as prescribed by OMB Super Circular Uniform Guidance. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: The fiscal year 2021-2022 Single Audit submission for Municipality of Toa Alta will be submitted through the Federal Audit Clearinghouse (FAC) no later than April 30, 2023. About the subsequent year Single Audit, we engaged the audit services on March 31, 2023, and we are going to engage the financial statements preparation consulting services on July 2023, in order to comply with fiscal year 2022-2023 Single Audit submission dateline. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-005
FINDING NUMBER: 2022-005 FEDERAL AGENCY: U.S. DEPARTMENT OF THE TREASURY PASS-THROUGH AGENCY: P.R. DEPARTMENT OF TREASURY - PUERTO RICO FISCAL AGENCY AND FINANCIAL ADVISORY AUTHORITY FEDERAL PROGRAM: CORONAVIRUS RELIEF FUND (ALN 21.019) REQUIREMENT: REPORTING ? SPECIAL REPORTING (L) TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: In our Reporting Test, we found that the Municipality did not comply with the monthly compliance reporting requirements established by the pass-through agencies. We found that in some months the reports were submitted late or not submitted at all. CRITERIA: The Coronavirus Relief Fund Transfer Agreements, Clause 5.1, states that the transferee shall submit reports as the transferor determines are needed to verify the use of the funds and compliance with conditions that are imposed on the Transfer Agreement, and such reports shall be in such form, with such content, as specified by the transferor in the transfer plan and future program instructions directed to all recipients. The transferor will transfer emergency assistance fund to transferee for necessary expenditures related to the COVID-19 emergency by making a transfer on the basis set out in the Agreement and in the Transfer Plan. The passthrough entities established that the reports are due on the 15th day of each month and must detail the use of funds of the prior month. CAUSE: There is a lack of knowledge and training to personal assigned. Additionally, the Municipality does not have an adequate monitoring for the activity and the reports. EFFECT: The program is not in compliance with the Reporting Requirements as established in the transfer agreement. RECOMMENDATION: We recommend training for the authorized personnel to work with the program where they can understand and know how to develop the required reports by the pass-through agency. Also, the Municipality should establish a monitoring system to ensure compliance with established requirements, such as: submit the reports on or before the 15th day of each month. This will ensure better control for the program. QUESTIONED COST: None PRIOR YEAR FINDING: A similar finding was presented in prior year Schedule of Findings and Questioned Costs (2021-006) VIEWS OF PLANNED RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: We concur with the auditor?s finding. The Finance Director is aware about the compliance requirement. We gave instructions to the accounting staff to maintain a dateline control sheet to ascertain that required reports for all grants were submitted within the due date. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-008
FINDING NUMBER: 2022-008 REQUIREMENT: SINGLE AUDIT ACT TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: The Single Audit Report for the fiscal year ended June 30, 2022 was not issued within nine (9) months after the end of the audit period. The Data Collection Form and the reporting package was not submitted on a timely basis. CRITERIA: The Single Audit Act, as amended, requires that the audit report must be submitted to the Federal Audit Clearinghouse no later than nine (9) months after the end of the audit period. CAUSE: The Municipality did not comply with the established regulation as prescribed in OMB Super Circular Uniform Guidance. EFFECT: The Municipality could lose federal grants due to the noncompliance with the Single Audit Act requirements. RECOMMENDATION: Procedures should be implemented to ensure that the Agency complies with the established Federal Regulation, as prescribed by OMB Super Circular Uniform Guidance. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: The fiscal year 2021-2022 Single Audit submission for Municipality of Toa Alta will be submitted through the Federal Audit Clearinghouse (FAC) no later than April 30, 2023. About the subsequent year Single Audit, we engaged the audit services on March 31, 2023, and we are going to engage the financial statements preparation consulting services on July 2023, in order to comply with fiscal year 2022-2023 Single Audit submission dateline. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-008
FINDING NUMBER: 2022-008 REQUIREMENT: SINGLE AUDIT ACT TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: The Single Audit Report for the fiscal year ended June 30, 2022 was not issued within nine (9) months after the end of the audit period. The Data Collection Form and the reporting package was not submitted on a timely basis. CRITERIA: The Single Audit Act, as amended, requires that the audit report must be submitted to the Federal Audit Clearinghouse no later than nine (9) months after the end of the audit period. CAUSE: The Municipality did not comply with the established regulation as prescribed in OMB Super Circular Uniform Guidance. EFFECT: The Municipality could lose federal grants due to the noncompliance with the Single Audit Act requirements. RECOMMENDATION: Procedures should be implemented to ensure that the Agency complies with the established Federal Regulation, as prescribed by OMB Super Circular Uniform Guidance. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: The fiscal year 2021-2022 Single Audit submission for Municipality of Toa Alta will be submitted through the Federal Audit Clearinghouse (FAC) no later than April 30, 2023. About the subsequent year Single Audit, we engaged the audit services on March 31, 2023, and we are going to engage the financial statements preparation consulting services on July 2023, in order to comply with fiscal year 2022-2023 Single Audit submission dateline. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-007
FINDING NUMBER: 2022-007 FEDERAL AGENCY: U.S. DEPARTMENT OF THE TREASURY PASS-THROUGH AGENCY: P.R. DEPARTMENT OF TREASURY - PUERTO RICO FISCAL AGENCY AND FINANCIAL ADVISORY AUTHORITY FEDERAL PROGRAM: CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS (ALN 21.027) REQUIREMENT: PROCUREMENT SUSPENSION & DEBARMENT (I) TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: In our Procurement Contract Provision Test, we evaluated four contract agreements. We found that the Municipality validated prior to award the contract that the supplier was not listed as a debarred, suspended, or otherwise excluded by agencies in the System for Award Management (SAM) for one (1) of the contracts. The validation of one (1) of the other three (3) contracts was made after the contract was signed, and the Municipality in the process to finalize the validation for the other two (2). Also, we found that the Municipality did not include all contract provisions required for non-federal entity contracts under federal awards for one (1) of the four (4) contracts. CRITERIA: Pursuant to 31 CFR section 19.300, prior to entering into subawards and contracts with award funds, recipients must verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded by (a) checking the EPLS; or collecting a certification from the entity; or adding a contract provision. 2 CFR section 200.327 references Appendix II to Part 200, which establishes contract provisions that must be included in non-federal entity contracts under federal awards. According to 2 CFR section 200.327, Appendix II to Part 200, (h), a contract must not be awarded to parties listed on the government exclusions in the System for Award Management (SAM), in accordance with OMB guidelines at 2 CFR 180 that implement Executive 12549 and 12689. The SAM Exclusions contain the names of parties debarred, suspended, or otherwise excluded by agencies, as well as parties found ineligible under any legal or regulatory authority other than Executive Order 12549. CAUSE:There is lack of knowledge about the contract provisions required to be included in federal awards contracts and the procedure to verify if the contractors are excluded in the System for Award Management (SAM). Therefore, the Municipality has been awarding contracts without the proper procurement procedure. EFFECT: The program is in noncompliance with the Procurement Suspension and Debarment requirements as established in 31 CFR section 19.300 and 2 CFR section 200.327. RECOMMENDATION: We recommend to the program administrators to include in the requisition for contracts a description of the requirements that need to be fulfilled to award a federal contract. In order to take into consideration a proposal or bid, the Municipality must have on hand the System for Award Management certification of the entity that indicates that the supplier is active and not listed in the governmentwide exclusion list. Contracts should not be signed without the proper documentation of the SAM.gov certification and payments should not be made without the required contract provisions. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: We concur with the auditor?s finding. We are going to prepare written policies and procedures in accordance with Uniform Guidance. Implementation Date: May 31, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-008
FINDING NUMBER: 2022-008 REQUIREMENT: SINGLE AUDIT ACT TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: The Single Audit Report for the fiscal year ended June 30, 2022 was not issued within nine (9) months after the end of the audit period. The Data Collection Form and the reporting package was not submitted on a timely basis. CRITERIA: The Single Audit Act, as amended, requires that the audit report must be submitted to the Federal Audit Clearinghouse no later than nine (9) months after the end of the audit period. CAUSE: The Municipality did not comply with the established regulation as prescribed in OMB Super Circular Uniform Guidance. EFFECT: The Municipality could lose federal grants due to the noncompliance with the Single Audit Act requirements. RECOMMENDATION: Procedures should be implemented to ensure that the Agency complies with the established Federal Regulation, as prescribed by OMB Super Circular Uniform Guidance. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: The fiscal year 2021-2022 Single Audit submission for Municipality of Toa Alta will be submitted through the Federal Audit Clearinghouse (FAC) no later than April 30, 2023. About the subsequent year Single Audit, we engaged the audit services on March 31, 2023, and we are going to engage the financial statements preparation consulting services on July 2023, in order to comply with fiscal year 2022-2023 Single Audit submission dateline. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-006
FINDING NUMBER: 2022-006 FEDERAL AGENCY: U.S. DEPARTMENT OF THE TREASURY PASS-THROUGH AGENCY: P.R. DEPARTMENT OF TREASURY - PUERTO RICO FISCAL AGENCY AND FINANCIAL ADVISORY AUTHORITY FEDERAL PROGRAM: CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS (ALN 21.027) REQUIREMENT: REPORTING ? SPECIAL REPORTING (L) TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: During the fiscal year, the Municipality administered funds from the Coronavirus State and Local Fiscal Recovery Funds. This allocation was granted directly from the Federal government and through the Puerto Rico Fiscal Agency and Financial Advisory Authority, respectively. In our Reporting Test, we found that the Municipality did not comply with the monthly compliance reporting requirements established by the Puerto Rico Fiscal Agency and Financial Advisory Authority. CRITERIA: The Municipal Strengthening Fund Transfer Agreement, Clause 5.1, states that the transferee shall submit reports as the transferor determines are needed to verify use of the funds and compliance with conditions that are imposed on the Transfer Agreement, and such reports shall be in such form, with such content, as specified by the transferor in the transfer plan and future program instructions directed to all recipients. The Transfer Plan, on Exhibit A, establishes that starting on the 15th day of the month following receipt of the funds, and by the 15th day of each month, the Transferee will submit a Use of Funds Report for the prior month?s expenses. Also, on the Municipal Strengthening Fund Program Guidelines, the Puerto Rico Fiscal Agency and Financial Advisory Authority specified on the Reporting Requirements Section that the recipients are required to submit monthly financial reports using the reporting template provided by the program. During the fiscal year 2021-2022, in addition to the contract agreement with the Puerto Rico Fiscal Agency and Financial Advisory Authority, the Municipality signed an agreement with the US Department of Treasury to receive funds direct funds as an Entitlement and County Unit. Those transfer agreements also established reporting requirements that we determined that the Municipality was in compliance. CAUSE: There is a lack of knowledge and training to personnel assigned. Additionally, the Municipality does not have an adequate monitoring for the activity and the reports. EFFECT: The program is not in compliance with the Reporting Requirements as established in the transfer agreement. RECOMMENDATION: We recommend training for the authorized personnel who administer the program, to better understand the reporting requirements and develop complete and accurate reports. The Municipality should establish a monitoring system to ensure compliance with requirements established by the passthrough agency such as: submitting the reports during the 15th day of each month, where the fund expenses of the previous month will be reported as incurred. This will ensure better control for the program. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: We concur with the auditor?s finding. The Finance Director is aware about the compliance requirement. We gave instructions to the accounting staff to maintain a dateline control sheet to ascertain that required reports were submitted within the due date. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-007
FINDING NUMBER: 2022-007 FEDERAL AGENCY: U.S. DEPARTMENT OF THE TREASURY PASS-THROUGH AGENCY: P.R. DEPARTMENT OF TREASURY - PUERTO RICO FISCAL AGENCY AND FINANCIAL ADVISORY AUTHORITY FEDERAL PROGRAM: CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS (ALN 21.027) REQUIREMENT: PROCUREMENT SUSPENSION & DEBARMENT (I) TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: In our Procurement Contract Provision Test, we evaluated four contract agreements. We found that the Municipality validated prior to award the contract that the supplier was not listed as a debarred, suspended, or otherwise excluded by agencies in the System for Award Management (SAM) for one (1) of the contracts. The validation of one (1) of the other three (3) contracts was made after the contract was signed, and the Municipality in the process to finalize the validation for the other two (2). Also, we found that the Municipality did not include all contract provisions required for non-federal entity contracts under federal awards for one (1) of the four (4) contracts. CRITERIA: Pursuant to 31 CFR section 19.300, prior to entering into subawards and contracts with award funds, recipients must verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded by (a) checking the EPLS; or collecting a certification from the entity; or adding a contract provision. 2 CFR section 200.327 references Appendix II to Part 200, which establishes contract provisions that must be included in non-federal entity contracts under federal awards. According to 2 CFR section 200.327, Appendix II to Part 200, (h), a contract must not be awarded to parties listed on the government exclusions in the System for Award Management (SAM), in accordance with OMB guidelines at 2 CFR 180 that implement Executive 12549 and 12689. The SAM Exclusions contain the names of parties debarred, suspended, or otherwise excluded by agencies, as well as parties found ineligible under any legal or regulatory authority other than Executive Order 12549. CAUSE:There is lack of knowledge about the contract provisions required to be included in federal awards contracts and the procedure to verify if the contractors are excluded in the System for Award Management (SAM). Therefore, the Municipality has been awarding contracts without the proper procurement procedure. EFFECT: The program is in noncompliance with the Procurement Suspension and Debarment requirements as established in 31 CFR section 19.300 and 2 CFR section 200.327. RECOMMENDATION: We recommend to the program administrators to include in the requisition for contracts a description of the requirements that need to be fulfilled to award a federal contract. In order to take into consideration a proposal or bid, the Municipality must have on hand the System for Award Management certification of the entity that indicates that the supplier is active and not listed in the governmentwide exclusion list. Contracts should not be signed without the proper documentation of the SAM.gov certification and payments should not be made without the required contract provisions. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: We concur with the auditor?s finding. We are going to prepare written policies and procedures in accordance with Uniform Guidance. Implementation Date: May 31, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-008
FINDING NUMBER: 2022-008 REQUIREMENT: SINGLE AUDIT ACT TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: The Single Audit Report for the fiscal year ended June 30, 2022 was not issued within nine (9) months after the end of the audit period. The Data Collection Form and the reporting package was not submitted on a timely basis. CRITERIA: The Single Audit Act, as amended, requires that the audit report must be submitted to the Federal Audit Clearinghouse no later than nine (9) months after the end of the audit period. CAUSE: The Municipality did not comply with the established regulation as prescribed in OMB Super Circular Uniform Guidance. EFFECT: The Municipality could lose federal grants due to the noncompliance with the Single Audit Act requirements. RECOMMENDATION: Procedures should be implemented to ensure that the Agency complies with the established Federal Regulation, as prescribed by OMB Super Circular Uniform Guidance. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: The fiscal year 2021-2022 Single Audit submission for Municipality of Toa Alta will be submitted through the Federal Audit Clearinghouse (FAC) no later than April 30, 2023. About the subsequent year Single Audit, we engaged the audit services on March 31, 2023, and we are going to engage the financial statements preparation consulting services on July 2023, in order to comply with fiscal year 2022-2023 Single Audit submission dateline. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-008
FINDING NUMBER: 2022-008 REQUIREMENT: SINGLE AUDIT ACT TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: The Single Audit Report for the fiscal year ended June 30, 2022 was not issued within nine (9) months after the end of the audit period. The Data Collection Form and the reporting package was not submitted on a timely basis. CRITERIA: The Single Audit Act, as amended, requires that the audit report must be submitted to the Federal Audit Clearinghouse no later than nine (9) months after the end of the audit period. CAUSE: The Municipality did not comply with the established regulation as prescribed in OMB Super Circular Uniform Guidance. EFFECT: The Municipality could lose federal grants due to the noncompliance with the Single Audit Act requirements. RECOMMENDATION: Procedures should be implemented to ensure that the Agency complies with the established Federal Regulation, as prescribed by OMB Super Circular Uniform Guidance. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: The fiscal year 2021-2022 Single Audit submission for Municipality of Toa Alta will be submitted through the Federal Audit Clearinghouse (FAC) no later than April 30, 2023. About the subsequent year Single Audit, we engaged the audit services on March 31, 2023, and we are going to engage the financial statements preparation consulting services on July 2023, in order to comply with fiscal year 2022-2023 Single Audit submission dateline. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-008
FINDING NUMBER: 2022-008 REQUIREMENT: SINGLE AUDIT ACT TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: The Single Audit Report for the fiscal year ended June 30, 2022 was not issued within nine (9) months after the end of the audit period. The Data Collection Form and the reporting package was not submitted on a timely basis. CRITERIA: The Single Audit Act, as amended, requires that the audit report must be submitted to the Federal Audit Clearinghouse no later than nine (9) months after the end of the audit period. CAUSE: The Municipality did not comply with the established regulation as prescribed in OMB Super Circular Uniform Guidance. EFFECT: The Municipality could lose federal grants due to the noncompliance with the Single Audit Act requirements. RECOMMENDATION: Procedures should be implemented to ensure that the Agency complies with the established Federal Regulation, as prescribed by OMB Super Circular Uniform Guidance. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: The fiscal year 2021-2022 Single Audit submission for Municipality of Toa Alta will be submitted through the Federal Audit Clearinghouse (FAC) no later than April 30, 2023. About the subsequent year Single Audit, we engaged the audit services on March 31, 2023, and we are going to engage the financial statements preparation consulting services on July 2023, in order to comply with fiscal year 2022-2023 Single Audit submission dateline. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-008
FINDING NUMBER: 2022-008 REQUIREMENT: SINGLE AUDIT ACT TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: The Single Audit Report for the fiscal year ended June 30, 2022 was not issued within nine (9) months after the end of the audit period. The Data Collection Form and the reporting package was not submitted on a timely basis. CRITERIA: The Single Audit Act, as amended, requires that the audit report must be submitted to the Federal Audit Clearinghouse no later than nine (9) months after the end of the audit period. CAUSE: The Municipality did not comply with the established regulation as prescribed in OMB Super Circular Uniform Guidance. EFFECT: The Municipality could lose federal grants due to the noncompliance with the Single Audit Act requirements. RECOMMENDATION: Procedures should be implemented to ensure that the Agency complies with the established Federal Regulation, as prescribed by OMB Super Circular Uniform Guidance. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: The fiscal year 2021-2022 Single Audit submission for Municipality of Toa Alta will be submitted through the Federal Audit Clearinghouse (FAC) no later than April 30, 2023. About the subsequent year Single Audit, we engaged the audit services on March 31, 2023, and we are going to engage the financial statements preparation consulting services on July 2023, in order to comply with fiscal year 2022-2023 Single Audit submission dateline. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-005
FINDING NUMBER: 2022-005 FEDERAL AGENCY: U.S. DEPARTMENT OF THE TREASURY PASS-THROUGH AGENCY: P.R. DEPARTMENT OF TREASURY - PUERTO RICO FISCAL AGENCY AND FINANCIAL ADVISORY AUTHORITY FEDERAL PROGRAM: CORONAVIRUS RELIEF FUND (ALN 21.019) REQUIREMENT: REPORTING ? SPECIAL REPORTING (L) TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: In our Reporting Test, we found that the Municipality did not comply with the monthly compliance reporting requirements established by the pass-through agencies. We found that in some months the reports were submitted late or not submitted at all. CRITERIA: The Coronavirus Relief Fund Transfer Agreements, Clause 5.1, states that the transferee shall submit reports as the transferor determines are needed to verify the use of the funds and compliance with conditions that are imposed on the Transfer Agreement, and such reports shall be in such form, with such content, as specified by the transferor in the transfer plan and future program instructions directed to all recipients. The transferor will transfer emergency assistance fund to transferee for necessary expenditures related to the COVID-19 emergency by making a transfer on the basis set out in the Agreement and in the Transfer Plan. The passthrough entities established that the reports are due on the 15th day of each month and must detail the use of funds of the prior month. CAUSE: There is a lack of knowledge and training to personal assigned. Additionally, the Municipality does not have an adequate monitoring for the activity and the reports. EFFECT: The program is not in compliance with the Reporting Requirements as established in the transfer agreement. RECOMMENDATION: We recommend training for the authorized personnel to work with the program where they can understand and know how to develop the required reports by the pass-through agency. Also, the Municipality should establish a monitoring system to ensure compliance with established requirements, such as: submit the reports on or before the 15th day of each month. This will ensure better control for the program. QUESTIONED COST: None PRIOR YEAR FINDING: A similar finding was presented in prior year Schedule of Findings and Questioned Costs (2021-006) VIEWS OF PLANNED RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: We concur with the auditor?s finding. The Finance Director is aware about the compliance requirement. We gave instructions to the accounting staff to maintain a dateline control sheet to ascertain that required reports for all grants were submitted within the due date. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-008
FINDING NUMBER: 2022-008 REQUIREMENT: SINGLE AUDIT ACT TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: The Single Audit Report for the fiscal year ended June 30, 2022 was not issued within nine (9) months after the end of the audit period. The Data Collection Form and the reporting package was not submitted on a timely basis. CRITERIA: The Single Audit Act, as amended, requires that the audit report must be submitted to the Federal Audit Clearinghouse no later than nine (9) months after the end of the audit period. CAUSE: The Municipality did not comply with the established regulation as prescribed in OMB Super Circular Uniform Guidance. EFFECT: The Municipality could lose federal grants due to the noncompliance with the Single Audit Act requirements. RECOMMENDATION: Procedures should be implemented to ensure that the Agency complies with the established Federal Regulation, as prescribed by OMB Super Circular Uniform Guidance. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: The fiscal year 2021-2022 Single Audit submission for Municipality of Toa Alta will be submitted through the Federal Audit Clearinghouse (FAC) no later than April 30, 2023. About the subsequent year Single Audit, we engaged the audit services on March 31, 2023, and we are going to engage the financial statements preparation consulting services on July 2023, in order to comply with fiscal year 2022-2023 Single Audit submission dateline. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-008
FINDING NUMBER: 2022-008 REQUIREMENT: SINGLE AUDIT ACT TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: The Single Audit Report for the fiscal year ended June 30, 2022 was not issued within nine (9) months after the end of the audit period. The Data Collection Form and the reporting package was not submitted on a timely basis. CRITERIA: The Single Audit Act, as amended, requires that the audit report must be submitted to the Federal Audit Clearinghouse no later than nine (9) months after the end of the audit period. CAUSE: The Municipality did not comply with the established regulation as prescribed in OMB Super Circular Uniform Guidance. EFFECT: The Municipality could lose federal grants due to the noncompliance with the Single Audit Act requirements. RECOMMENDATION: Procedures should be implemented to ensure that the Agency complies with the established Federal Regulation, as prescribed by OMB Super Circular Uniform Guidance. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: The fiscal year 2021-2022 Single Audit submission for Municipality of Toa Alta will be submitted through the Federal Audit Clearinghouse (FAC) no later than April 30, 2023. About the subsequent year Single Audit, we engaged the audit services on March 31, 2023, and we are going to engage the financial statements preparation consulting services on July 2023, in order to comply with fiscal year 2022-2023 Single Audit submission dateline. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-007
FINDING NUMBER: 2022-007 FEDERAL AGENCY: U.S. DEPARTMENT OF THE TREASURY PASS-THROUGH AGENCY: P.R. DEPARTMENT OF TREASURY - PUERTO RICO FISCAL AGENCY AND FINANCIAL ADVISORY AUTHORITY FEDERAL PROGRAM: CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS (ALN 21.027) REQUIREMENT: PROCUREMENT SUSPENSION & DEBARMENT (I) TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: In our Procurement Contract Provision Test, we evaluated four contract agreements. We found that the Municipality validated prior to award the contract that the supplier was not listed as a debarred, suspended, or otherwise excluded by agencies in the System for Award Management (SAM) for one (1) of the contracts. The validation of one (1) of the other three (3) contracts was made after the contract was signed, and the Municipality in the process to finalize the validation for the other two (2). Also, we found that the Municipality did not include all contract provisions required for non-federal entity contracts under federal awards for one (1) of the four (4) contracts. CRITERIA: Pursuant to 31 CFR section 19.300, prior to entering into subawards and contracts with award funds, recipients must verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded by (a) checking the EPLS; or collecting a certification from the entity; or adding a contract provision. 2 CFR section 200.327 references Appendix II to Part 200, which establishes contract provisions that must be included in non-federal entity contracts under federal awards. According to 2 CFR section 200.327, Appendix II to Part 200, (h), a contract must not be awarded to parties listed on the government exclusions in the System for Award Management (SAM), in accordance with OMB guidelines at 2 CFR 180 that implement Executive 12549 and 12689. The SAM Exclusions contain the names of parties debarred, suspended, or otherwise excluded by agencies, as well as parties found ineligible under any legal or regulatory authority other than Executive Order 12549. CAUSE:There is lack of knowledge about the contract provisions required to be included in federal awards contracts and the procedure to verify if the contractors are excluded in the System for Award Management (SAM). Therefore, the Municipality has been awarding contracts without the proper procurement procedure. EFFECT: The program is in noncompliance with the Procurement Suspension and Debarment requirements as established in 31 CFR section 19.300 and 2 CFR section 200.327. RECOMMENDATION: We recommend to the program administrators to include in the requisition for contracts a description of the requirements that need to be fulfilled to award a federal contract. In order to take into consideration a proposal or bid, the Municipality must have on hand the System for Award Management certification of the entity that indicates that the supplier is active and not listed in the governmentwide exclusion list. Contracts should not be signed without the proper documentation of the SAM.gov certification and payments should not be made without the required contract provisions. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: We concur with the auditor?s finding. We are going to prepare written policies and procedures in accordance with Uniform Guidance. Implementation Date: May 31, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-008
FINDING NUMBER: 2022-008 REQUIREMENT: SINGLE AUDIT ACT TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: The Single Audit Report for the fiscal year ended June 30, 2022 was not issued within nine (9) months after the end of the audit period. The Data Collection Form and the reporting package was not submitted on a timely basis. CRITERIA: The Single Audit Act, as amended, requires that the audit report must be submitted to the Federal Audit Clearinghouse no later than nine (9) months after the end of the audit period. CAUSE: The Municipality did not comply with the established regulation as prescribed in OMB Super Circular Uniform Guidance. EFFECT: The Municipality could lose federal grants due to the noncompliance with the Single Audit Act requirements. RECOMMENDATION: Procedures should be implemented to ensure that the Agency complies with the established Federal Regulation, as prescribed by OMB Super Circular Uniform Guidance. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: The fiscal year 2021-2022 Single Audit submission for Municipality of Toa Alta will be submitted through the Federal Audit Clearinghouse (FAC) no later than April 30, 2023. About the subsequent year Single Audit, we engaged the audit services on March 31, 2023, and we are going to engage the financial statements preparation consulting services on July 2023, in order to comply with fiscal year 2022-2023 Single Audit submission dateline. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-006
FINDING NUMBER: 2022-006 FEDERAL AGENCY: U.S. DEPARTMENT OF THE TREASURY PASS-THROUGH AGENCY: P.R. DEPARTMENT OF TREASURY - PUERTO RICO FISCAL AGENCY AND FINANCIAL ADVISORY AUTHORITY FEDERAL PROGRAM: CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS (ALN 21.027) REQUIREMENT: REPORTING ? SPECIAL REPORTING (L) TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: During the fiscal year, the Municipality administered funds from the Coronavirus State and Local Fiscal Recovery Funds. This allocation was granted directly from the Federal government and through the Puerto Rico Fiscal Agency and Financial Advisory Authority, respectively. In our Reporting Test, we found that the Municipality did not comply with the monthly compliance reporting requirements established by the Puerto Rico Fiscal Agency and Financial Advisory Authority. CRITERIA: The Municipal Strengthening Fund Transfer Agreement, Clause 5.1, states that the transferee shall submit reports as the transferor determines are needed to verify use of the funds and compliance with conditions that are imposed on the Transfer Agreement, and such reports shall be in such form, with such content, as specified by the transferor in the transfer plan and future program instructions directed to all recipients. The Transfer Plan, on Exhibit A, establishes that starting on the 15th day of the month following receipt of the funds, and by the 15th day of each month, the Transferee will submit a Use of Funds Report for the prior month?s expenses. Also, on the Municipal Strengthening Fund Program Guidelines, the Puerto Rico Fiscal Agency and Financial Advisory Authority specified on the Reporting Requirements Section that the recipients are required to submit monthly financial reports using the reporting template provided by the program. During the fiscal year 2021-2022, in addition to the contract agreement with the Puerto Rico Fiscal Agency and Financial Advisory Authority, the Municipality signed an agreement with the US Department of Treasury to receive funds direct funds as an Entitlement and County Unit. Those transfer agreements also established reporting requirements that we determined that the Municipality was in compliance. CAUSE: There is a lack of knowledge and training to personnel assigned. Additionally, the Municipality does not have an adequate monitoring for the activity and the reports. EFFECT: The program is not in compliance with the Reporting Requirements as established in the transfer agreement. RECOMMENDATION: We recommend training for the authorized personnel who administer the program, to better understand the reporting requirements and develop complete and accurate reports. The Municipality should establish a monitoring system to ensure compliance with requirements established by the passthrough agency such as: submitting the reports during the 15th day of each month, where the fund expenses of the previous month will be reported as incurred. This will ensure better control for the program. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: We concur with the auditor?s finding. The Finance Director is aware about the compliance requirement. We gave instructions to the accounting staff to maintain a dateline control sheet to ascertain that required reports were submitted within the due date. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-007
FINDING NUMBER: 2022-007 FEDERAL AGENCY: U.S. DEPARTMENT OF THE TREASURY PASS-THROUGH AGENCY: P.R. DEPARTMENT OF TREASURY - PUERTO RICO FISCAL AGENCY AND FINANCIAL ADVISORY AUTHORITY FEDERAL PROGRAM: CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS (ALN 21.027) REQUIREMENT: PROCUREMENT SUSPENSION & DEBARMENT (I) TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: In our Procurement Contract Provision Test, we evaluated four contract agreements. We found that the Municipality validated prior to award the contract that the supplier was not listed as a debarred, suspended, or otherwise excluded by agencies in the System for Award Management (SAM) for one (1) of the contracts. The validation of one (1) of the other three (3) contracts was made after the contract was signed, and the Municipality in the process to finalize the validation for the other two (2). Also, we found that the Municipality did not include all contract provisions required for non-federal entity contracts under federal awards for one (1) of the four (4) contracts. CRITERIA: Pursuant to 31 CFR section 19.300, prior to entering into subawards and contracts with award funds, recipients must verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded by (a) checking the EPLS; or collecting a certification from the entity; or adding a contract provision. 2 CFR section 200.327 references Appendix II to Part 200, which establishes contract provisions that must be included in non-federal entity contracts under federal awards. According to 2 CFR section 200.327, Appendix II to Part 200, (h), a contract must not be awarded to parties listed on the government exclusions in the System for Award Management (SAM), in accordance with OMB guidelines at 2 CFR 180 that implement Executive 12549 and 12689. The SAM Exclusions contain the names of parties debarred, suspended, or otherwise excluded by agencies, as well as parties found ineligible under any legal or regulatory authority other than Executive Order 12549. CAUSE:There is lack of knowledge about the contract provisions required to be included in federal awards contracts and the procedure to verify if the contractors are excluded in the System for Award Management (SAM). Therefore, the Municipality has been awarding contracts without the proper procurement procedure. EFFECT: The program is in noncompliance with the Procurement Suspension and Debarment requirements as established in 31 CFR section 19.300 and 2 CFR section 200.327. RECOMMENDATION: We recommend to the program administrators to include in the requisition for contracts a description of the requirements that need to be fulfilled to award a federal contract. In order to take into consideration a proposal or bid, the Municipality must have on hand the System for Award Management certification of the entity that indicates that the supplier is active and not listed in the governmentwide exclusion list. Contracts should not be signed without the proper documentation of the SAM.gov certification and payments should not be made without the required contract provisions. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: We concur with the auditor?s finding. We are going to prepare written policies and procedures in accordance with Uniform Guidance. Implementation Date: May 31, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-008
FINDING NUMBER: 2022-008 REQUIREMENT: SINGLE AUDIT ACT TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: The Single Audit Report for the fiscal year ended June 30, 2022 was not issued within nine (9) months after the end of the audit period. The Data Collection Form and the reporting package was not submitted on a timely basis. CRITERIA: The Single Audit Act, as amended, requires that the audit report must be submitted to the Federal Audit Clearinghouse no later than nine (9) months after the end of the audit period. CAUSE: The Municipality did not comply with the established regulation as prescribed in OMB Super Circular Uniform Guidance. EFFECT: The Municipality could lose federal grants due to the noncompliance with the Single Audit Act requirements. RECOMMENDATION: Procedures should be implemented to ensure that the Agency complies with the established Federal Regulation, as prescribed by OMB Super Circular Uniform Guidance. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: The fiscal year 2021-2022 Single Audit submission for Municipality of Toa Alta will be submitted through the Federal Audit Clearinghouse (FAC) no later than April 30, 2023. About the subsequent year Single Audit, we engaged the audit services on March 31, 2023, and we are going to engage the financial statements preparation consulting services on July 2023, in order to comply with fiscal year 2022-2023 Single Audit submission dateline. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director
Finding 2022-008
FINDING NUMBER: 2022-008 REQUIREMENT: SINGLE AUDIT ACT TYPE OF FINDING: SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION: The Single Audit Report for the fiscal year ended June 30, 2022 was not issued within nine (9) months after the end of the audit period. The Data Collection Form and the reporting package was not submitted on a timely basis. CRITERIA: The Single Audit Act, as amended, requires that the audit report must be submitted to the Federal Audit Clearinghouse no later than nine (9) months after the end of the audit period. CAUSE: The Municipality did not comply with the established regulation as prescribed in OMB Super Circular Uniform Guidance. EFFECT: The Municipality could lose federal grants due to the noncompliance with the Single Audit Act requirements. RECOMMENDATION: Procedures should be implemented to ensure that the Agency complies with the established Federal Regulation, as prescribed by OMB Super Circular Uniform Guidance. QUESTIONED COST: None PRIOR YEAR FINDING: None VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: The fiscal year 2021-2022 Single Audit submission for Municipality of Toa Alta will be submitted through the Federal Audit Clearinghouse (FAC) no later than April 30, 2023. About the subsequent year Single Audit, we engaged the audit services on March 31, 2023, and we are going to engage the financial statements preparation consulting services on July 2023, in order to comply with fiscal year 2022-2023 Single Audit submission dateline. Implementation Date: April 30, 2023 Responsible Person: Kristian Rivera Santiago Finance Director