FAC Explorer

Finding 1080146 (2023-006)

Material Weakness
Requirement
L
Questioned Costs
-
Year
2023
Accepted
2024-10-25
Audit: 325909
Organization: City of Auburn, Maine (ME)
Auditor: Runyon Kersteen Ouellette

AI Summary

  • Core Issue: Errors in quarterly reports for State and Local Fiscal Recovery Funds, with 4 out of 10 projects showing discrepancies in reported expenditures.
  • Impacted Requirements: Accurate submission of Project and Expenditure Reports is essential for compliance with U.S. Department of the Treasury guidelines.
  • Recommended Follow-Up: Revise tracking spreadsheets to distinguish between obligations and expenditures, and implement a review process by Finance Department staff before report submission.

Finding Text

2023-006 U.S. Department of the Treasury, For the period July 1, 2022 through June 30, 2023, Assistance Listing #21.027 – Internal Controls over State and Local Fiscal Recovery Fund Criteria: As a recipient of State and Local Fiscal Recovery Funds (SLRF), the City is required to submit quarterly Project and Expenditure Reports to the U.S. Department of the Treasury. These submissions report cumulative and quarterly obligations and expenditures by project, subaward and vendor information, and revenue replacement information. Condition: We tested 10 of the 39 SLRF projects reported on the quarterly ARPA reports to determine whether cumulative and quarterly expenditures reconcile with the accounting system. We found errors in 4 of the 10 reports: • one project failed to include the reversal of the prior year payroll accrual totaling $1,385, causing that expense to be double-counted; • three projects reported a total of $374,811 of expenditures when the purchase order was approved; however the service had not been performed and the expenditure had not yet been realized. These items were properly reported as obligations but should not have been reported as expenditures. Cause: The project spreadsheets developed to track cumulative and quarterly expenditures do not separately track obligations. In addition, there is no secondary review by a member of the Finance Department to double check the data in the reports. As a result, errors in reporting remain undetected. Effect: Failure to complete reports accurately and maintain proper supporting documentation for amounts reported could skew the financial position of the program and related projects. As such, measurement of results and management decisions for future projects could be based on inaccurate information. Recommendation: We recommend revising the City’s project tracking spreadsheets to include columns to separately track purchase orders. This will ensure expenses aren’t confused with obligations. We also recommend a member of the Finance Department review and approve the report before it is submitted to the U.S. Department of the Treasury. Likely Questioned Costs: None.

Categories

Subrecipient Monitoring Procurement, Suspension & Debarment Internal Control / Segregation of Duties Reporting

Other Findings in this Audit

  • 503696 2023-007
    Material Weakness
  • 503697 2023-007
    Material Weakness
  • 503698 2023-007
    Material Weakness
  • 503699 2023-007
    Material Weakness
  • 503700 2023-007
    Material Weakness
  • 503701 2023-008
    Material Weakness
  • 503702 2023-008
    Material Weakness
  • 503703 2023-008
    Material Weakness
  • 503704 2023-006
    Material Weakness
  • 1080138 2023-007
    Material Weakness
  • 1080139 2023-007
    Material Weakness
  • 1080140 2023-007
    Material Weakness
  • 1080141 2023-007
    Material Weakness
  • 1080142 2023-007
    Material Weakness
  • 1080143 2023-008
    Material Weakness
  • 1080144 2023-008
    Material Weakness
  • 1080145 2023-008
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
21.027 Covid-19 - Coronavirus State and Local Fiscal Recovery Funds $1.74M
84.425 Covid-19 - Elementary and Secondary School Emergency Relief III $1.34M
20.205 Highway Planning and Construction - Mill Street and Main Street $1.10M
84.027 Special Education - Grants to States (idea, Part B) $1.07M
84.010 Title Ia $1.06M
84.425 Covid-19 - Elementary and Secondary School Emergency Relief II $1.03M
10.555 National School Lunch Program $1.01M
10.553 School Breakfast Program $300,532
14.905 Lead Hazard Reduction Demonstration Grant $284,020
14.218 Community Development Block Grant - Entitlement $262,804
84.367 Title Iia - Supporting Effective Instruction $234,228
84.287 21st Century - Community Learning Center $216,431
20.205 Highway Planning and Construction - Traffic Signals $212,854
10.555 Donated Commodities $181,252
10.559 Summer Food Service Program $117,031
14.239 Covid-19 - Home Investment Partnership Program $116,681
14.239 Home Investment Partnership Program $102,063
84.425 Covid-19- Multilingual Learners Experiencing Homelessness $92,292
10.560 State Administrative Expenses for Child Nutrition: Supply Chain Assistance $87,991
14.218 Covid-19 - Community Development Block Grant - Entitlement $87,889
93.575 Covid-19 - Childcare and Development Block Grant $69,742
10.582 Fresh Fruit and Vegetable Program $63,736
97.044 Assistance to Firefighters Grant $49,570
97.067 Homeland Security $48,661
84.424 Title IV - Student Support and Academic Enrichment $25,197
84.425 Covid-19 - Homeless Children and Youth II $24,787
84.173 Special Education - Preschool Grants (idea Preschool) $23,536
84.002 Adult Basic Education $22,475
16.034 Covid-19 - Coronavirus Emergency Supplemental Funding Program $18,743
97.036 Disaster Grants - Public Assistance $18,743
84.365 Title III - Language Acquisition $13,681
10.558 Child and Adult Care Food Program $10,222
16.922 Equitable Sharing Program $7,716
14.218 Community Development Block Grant - Entitlement - School Department $7,386
16.607 Bullet Proof Vest $7,195
16.738 Edward Byrne Justice Assistance Grant $5,100
10.649 Covid-19 - Pandemic Ebt Administrative Costs: Snap $5,024
20.600 Evidence Based Impaired Driving (oui Grant) $4,356
20.600 Speed Enforcement Program $3,603
16.727 Enforcing Underage Drinking Laws $2,560
84.010 Title Ia - Program Improvement $1,814
84.173 Covid-19 - Special Education - Preschool Grants (idea Preschool) $1,471
20.600 Pedestrian Safety Grant $917
20.616 Hv Distracted Driving Enforcement Project $604
20.205 Highway Planning and Construction - Hotel Rd. $483