Finding 1149718 (2023-002)

Criteria: Federal funds expended throughout the City must be reported to the finance department for proper reporting on the schedule of expenditures of federal awards (“SEFA”). Condition: Funding related to the American Rescue Plan Act (“ARPA”) was omitted from the SEFA and was not reported to the finance department as part of the year end closing process related to the Sapulpa Basin 4 improvements and repairs to the wastewater treatment plant intake line. Cause and Effect: During FY23, projects approved for funding under ARPA were started by the City and were paid for using ARPA funding. However, the expenditures were not reported to the finance department as being funded by federal grant dollars and were not tracked against compliance requirements by the finance department to ensure allowability of costs. Additionally, since these expenditures were not properly reported to finance, the total amount spent on the ARPA grants was omitted from the original SEFA that was prepared by management and provided to the auditors. Recommendation: Management should implement processes and procedures to properly monitor federal awards expended in various departments of the City to ensure that they are properly reported to the finance department so that the expenditures are included on the SEFA each year.