Finding Text
Reference Number: Prior Year Finding: 2025-009 N/A Federal Agency: U.S. Department of Transportation Federal Program: Airport Improvement Program, Infrastructure Investments and Jobs Act Programs, and COVID-19 Airports Programs Assistance Listing Number: 20.106 Award Number and Year: 3-33-0011-124-2021, 2021 3-33-0011-137-2022, 2022 3-33-0011-138-2022, 2022 3-33-0011-139-2022, 2022 3-33-0011-140-2023, 2023 3-33-0011-142-2023, 2023 3-33-0011-143-2024, 2024 3-33-0011-134-2025, 2025 3-33-0011-144-2025, 2025 3-33-0011-146-2025, 2025 3-33-0011-147-2025, 2025 Compliance Requirement: Equipment and Real Property Management Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Compliance: A physical inventory of the property must be conducted, and the results must be reconciled with the property records at least once every two years. (2 CFR 200.313(d)(2)). Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The City performed an annual physical inventory of equipment acquired under the Federal program; however, the annual physical inventory was incomplete. Context: During testing, we selected a sample of five assets from the federal financial records which document equipment acquired under the Federal program. One of five assets selected for testing from the federal financial records was not included in the annual inventory list. Cause: The City's procedures and controls were not sufficient to ensure that all equipment acquired under the Federal program was accurately recorded and included in the annual inventory list and reconciled to the results of the physical inventory. CITY OF MANCHESTER, NEW HAMPSHIRE SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED) YEAR ENDED JUNE 30, 2025 (23) Section III – Findings and Questioned Costs – Major Federal Programs (Continued) Effect: The equipment records may not be complete or accurately reflect the existence, location, or condition of all assets acquired under the Federal program, and the City may not timely identify missing, obsolete, or improperly recorded equipment. Questioned costs: None. Recommendation: We recommend the City strengthen procedures and internal controls to ensure that all equipment acquired under the Federal program is accurately recorded and included in the annual inventory list, and that the annual physical inventory is reconciled to the equipment records. Views of Responsible Officials: There is no disagreement with the finding.