Corrective Action Plan
Finding 2021-005 – Lack of Controls Surrounding Oversight of Federal Expenditures
Criteria: Internal controls over financial reporting should be properly designed, implemented, and monitored to ensure all material transactions are recorded properly.
Condition: No contr...
Corrective Action Plan
Finding 2021-005 – Lack of Controls Surrounding Oversight of Federal Expenditures
Criteria: Internal controls over financial reporting should be properly designed, implemented, and monitored to ensure all material transactions are recorded properly.
Condition: No controls could be derived related to funding that was expneded by another organization after being passed through the City.
Cause: The City experienced significant turnover within key positions of the Finance and Administration departments, which caused controls for oversight of funds distributed to be overlooked, including proper recording and retention of supporting documentation.
Effect: Adjustments were recorded in several funds, as discussed below under "Context", as a result of audit procedures.
Context: Audit adjustments, as summarized below, were recorded in the noted funds as a result of our audit procedures. These audit adjustments have also been communicated separately in our required communications letter.
Capital Projects Fund – decrease of expenditures and increase in Due From Other Funds of $163,587.
Non-Major Governmental Funds – Special Grant Fund – increase in expenditures and increase in Due to Other Funds of $277,630.
Non-Major Governmental Funds – Water Fund – decrease in expenditures and increase in Due from Other Funds of $114,043.
Recommendation: We recommend that the City implement processes to monitor and reconcile account balances and record transactions in the proper period. Adjustments that are necessary should be recorded and supporting documentation should be retained when available.
Response/Corrective Action Plan: The Director of Administration & Finance, Accountant and impacted Department Directors as well as any necessary coordination with outside consultants will continue to be in discussions to adjust, revise and update the various projects, the approved funding sources and approved uses. In addition, Management will identify various financial system functions that are underutilized and update internal processes to track additional details within the system of record.
Anticipated Completed Date: June 30, 2025
Responsible Contact Person:
Elizabeth Greenwood, Director of Administration & Finance
City of Cortland, 25 Court Street, Cortland, NY 13045
(607) 758-8373