Finding 1132019 (2023-007)

Material Weakness Repeat Finding
Requirement
L
Questioned Costs
-
Year
2023
Accepted
2025-04-21
Audit: 354071
Organization: City of Espanola (NM)
Auditor: Cordova CPAS LLC

AI Summary

  • Core Issue: The City failed to timely complete the Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2023 due to staff turnover.
  • Impacted Requirements: This non-compliance violates OMB Uniform Guidance section 200.508 (b) and 200.510, which mandate accurate and timely preparation of federal award schedules.
  • Recommended Follow-up: Implement a systematic approach to prepare the SEFA during the closing process to ensure readiness for audits moving forward.

Finding Text

Federal program information: Funding agency: All Programs included in SEFA Title: All Programs included in SEFA Federal Assistance Listing Number: All Programs included in SEFA Compliance Requirement Reporting Award Period: July 1, 2022 to June 30, 2023 Condition: During our procedures over the Schedule of Expenditures of Federal Awards we noted the City did not accurately complete a Schedule of Expenditures and Federal Awards for audit purposes in a timely manner. The City did not made progress in this area during fiscal year 2023. However, in fiscal year 2025, the City was able to complete an accurate Schedule of Expenditures of Federal Awars for fiscal year 2023. Criteria: OMB Uniform Guidance section 200.508 (b) requires auditees in to prepare the schedule of federal awards in accordance with OMB Uniform Guidance section200.510. Cause: The City had a large turnover in the finance area and was not required to create a Schedule of Federal Awards in prior years as they have just recently started receiving federal funding and so they were not familiar with the process. Effect: The City is in violation of the Uniform Guidance requirements. Auditor’s Recommendation: We recommend that the City implement a system to ensure the preparation of the Schedule of Expenditure and Federal Awards be done in the closing process so that when the audit starts the Schedule of Expenditure and Federal Awards is ready to be audited and is complete. Agency’s Response: The City did complete the Schedule of Expenditures of Federal Awards (SEFA) for the year ended June 30, 2023 (fiscal year 2023) and was not completed timely as a result of staff turnover during fiscal year 2023. The schedule was completed, and no modifications were noted as a result of audit procedures to the completeness and accuracy of the SEFA. The City’s Procurement officer now maintains responsibility for grants from award to reversion date. A tracking file has been created and is maintained for all active grants at the point of award, expenditure, reimbursement, and close out. Responsible Parties: The Director of Finance. Timeline: June 30, 2025

Categories

Reporting

Other Findings in this Audit

  • 555575 2023-007
    Material Weakness Repeat
  • 555576 2023-007
    Material Weakness Repeat
  • 555577 2023-007
    Material Weakness Repeat
  • 555578 2023-007
    Material Weakness Repeat
  • 555579 2023-007
    Material Weakness Repeat
  • 555580 2023-008
    - Repeat
  • 555581 2023-008
    - Repeat
  • 555582 2023-008
    - Repeat
  • 555583 2023-008
    - Repeat
  • 555584 2023-008
    - Repeat
  • 555585 2023-009
    Material Weakness
  • 555586 2023-010
    Material Weakness
  • 1132017 2023-007
    Material Weakness Repeat
  • 1132018 2023-007
    Material Weakness Repeat
  • 1132020 2023-007
    Material Weakness Repeat
  • 1132021 2023-007
    Material Weakness Repeat
  • 1132022 2023-008
    - Repeat
  • 1132023 2023-008
    - Repeat
  • 1132024 2023-008
    - Repeat
  • 1132025 2023-008
    - Repeat
  • 1132026 2023-008
    - Repeat
  • 1132027 2023-009
    Material Weakness
  • 1132028 2023-010
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
21.027 Coronavirus State and Local Fiscal Recovery Funds $1.23M
16.710 Public Safety Partnership and Community Policing Grants $457,465
16.034 Coronavirus Emergency Supplemental Funding Program $96,044
95.001 High Intensity Drug Trafficking Areas Program $88,827
45.312 National Leadership Grants $13,749