Finding 21722 (2022-001)

-
Requirement
J
Questioned Costs
-
Year
2022
Accepted
2023-03-16
Audit: 24895
Organization: City of Grass Valley (CA)

AI Summary

  • Core Issue: The City inaccurately reported $393,906 in program income expenditures, while actual expenditures were $0.
  • Impacted Requirements: Reporting must reflect actual program income spent, not just amounts approved for expenditure.
  • Recommended Follow-Up: Ensure future reports only include actual expenditures to maintain compliance with the Program Income reporting criteria.

Finding Text

Name: Community Development Block Grants/State?s Program and Non-Entitlement Grants in Hawaii CFDA #: 14.228 Federal Grantor: U.S. Department of Housing and Urban Development Pass Through Entity: State Department of Housing and Community Development Award No.: Various Year: 2021/2022 Compliance Requirement: Program Income Criteria Reporting of Program Income on the California Department of Housing and Community Development Program Income Report should agree to actual expended by the City during the fiscal year. Condition We noted that although the City reported expending $393,906 in program income during the 2021/2022 fiscal year, actual amounts expended equalled $0. Cause The City reported the amount of program income approved for expenditure instead of the actual amount of program income expended during the 2021/2022 fiscal year. Effect The City reported an incorrect amount of program income expended during the fiscal year on the annual Program Income Report. Questioned Cost No questioned costs were identified as a result of our procedures. Context We reviewed the annual Program Income Report and compared the amount reported as program income expenditures to the amounts recorded in the general ledger. Repeat Finding This is not a repeat finding. Recommendation We recommend that the City only report actual program income expended during the fiscal year instead of amounts authorized to be expended. Views of Responsible Officials and Planned Corrective Action Refer to separate Management?s Corrective Action Plan for views of responsible officials and management?s responses.

Corrective Action Plan

2022-001 Community Development Block Grants/State?s Program and Non-Entitlement Grants in Hawaii We recommend that the City only report actual program income expended during the fiscal year instead of amounts authorized to be expended. Management?s Response: We concur with the finding. The City currently has a large grant from CDBG related to the upgrade of the Memorial Park Pool Facility. The City inadvertently reported a use of program income towards the project (which is required). However, it was determined that the grant funds were first used as the project was still ongoing. Responsible Individual: Andy Heath, Finance Director Corrective Action Plan: The City will work to assure the proper amounts of grant and program income are reported to the auditors. Anticipated Completion Date: FY 2022-23

Categories

Reporting Program Income

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
14.239 Home Investment Partnerships Program $7.94M
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $3.70M
21.027 Coronavirus State and Local Fiscal Recovery Funds $688,058
66.818 Brownfields Assessment and Cleanup Cooperative Agreements $122,631
20.205 Highway Planning and Construction $104,251