Finding 1152624 (2024-003)

Material Weakness: As identified in findings 2024-001 and 2024-002, the City’s reconciliation of bank balances, as well as payables and payroll related liability accounts continues to contain unreconciled differences and unrecorded transactions. This has continued to be a material weakness regarding internal control over financial reporting for a number of years with the City not taking effective corrective actions to resolve the issues. Although the City’s classification and reporting of allowable costs with respects to the Federal grants tested is reasonable and in compliance with grant terms, without proper control over reconciliation procedures, the control over allowable costs and the reporting of allowable costs could be compromised. The City must improve procedures to ensure there is proper monthly reconciliation and reporting of all bank, payables and payroll related liability accounts.