Finding 1206365 (2023-006)

Material Weakness Repeat Finding

Requirement

Questioned Costs

Year

2023

Accepted

2026-04-10

Audit: 398382

Organization: Town of Livermore Falls (ME)

Auditor: RHR SMITH & COMPANY

AI Summary

Core Issue: The Town lacks a cash management policy, which is crucial for safeguarding liquid assets.
Impacted Requirements: This finding violates 2 CFR sections 200.302(b)(6) and 200.305(b)(3), and it is a repeat issue from 2022.
Recommended Follow-up: The Town should adopt a cash management policy aligned with Uniform Guidance and establish internal controls to ensure compliance.

Finding Text

SIGNIFICANT DEFICIENCY 2023-006 - Cash Management Federal Program Information: ALN - 66.458 - Clean Water State Revolving Funds Criteria: The following CFR(s) apply to this finding: 2 CFR section 200.302(b)(6)) & 2 CFR section 200.305(b) (3). Condition: During audit procedures, it was identified that the Town did not have a cash management policy in place. Cause: The Town has experienced turnover in the Treasurer’s position over the past few years, which has delayed the policy implementation. Effect: The Town may not have adequate policy and procedures in place to safeguard its most liquid assets. Identification of Questioned Costs: None identified. Context: The population consisted of 6 out of 10 pay requisites deposit of reimbursements from the fiscal year were examined. Out of the 6 selections all 6 were not properly recorded. Repeat Finding: This is a repeat finding of 2022-007. Recommendation: It is recommended that the Town adopt a cash management policy that follows the Uniform Guidance and that the Town implement internal control processes and procedures to ensure that the adopted policy is followed. Views of Responsible Officials and Corrective Action Plan: Client agrees with finding and a version of their response can be found in the Corrective Action Plan. Please see the Corrective Action Plan issued by the Town of Livermore Falls.

Corrective Action Plan

CORRECTIVE ACTION PLAN (Concerning Finding 2023-006) Contact Person Responsible for Corrective Action: Carrie Castonguay, Town Manager Corrective Action: The Town Manager and Select Board will take the following actions to address finding 2023-006 The current Town Manager was appointed by the Select Board on August 14, 2023, and had no knowledge of this material weakness. She is an experienced Manager and has drafted, had approved and has implemented the new Internal Controls Policy that addresses this deficiency. This policy will includes sections on risk assessment and management, annual audit, chart of account, general ledger, reconciliation and verification, reserve funds and reserve accounts, investments, financial reporting, fraud, accounting software, online transactions and banking, documentation daily cash-ups, grants and projects, AR process, AP process, and payroll. Anticipated Completion Date: This was completed February 20, 2024.

Other Findings in this Audit

1206358 2023-003

Material Weakness Repeat
1206359 2023-003

Material Weakness Repeat
1206360 2023-004

Material Weakness Repeat
1206361 2023-004

Material Weakness Repeat
1206362 2023-005

Material Weakness Repeat
1206363 2023-005

Material Weakness Repeat
1206364 2023-006

Material Weakness Repeat
1206366 2023-007

Material Weakness Repeat
1206367 2023-007

Material Weakness Repeat

Programs in Audit

ALN	Program Name	Expenditures
10.760	WATER AND WASTE DISPOSAL SYSTEMS FOR RURAL COMMUNITIES	$1.75M
21.027	CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS	$25,729
66.458	CLEAN WATER STATE REVOLVING FUND	$12,689