Finding 23162 (2022-004)

Material Weakness

Requirement

Questioned Costs

Year

2022

Accepted

2022-12-21

Audit: 18000

Organization: City of Beaveron (MI)

Auditor: Quast Janke & Company

AI Summary

Core Issue: The City lacks formal written policies required by the Uniform Guidance for managing federal grants.
Impacted Requirements: Policies must cover allowability of costs, cash management, financial management, procurement, compensation/payroll, and travel costs.
Recommended Follow-Up: Update and implement these policies by the end of fiscal year 2023 to ensure compliance.

Finding Text

2022-004 AL# 10.766 Community Facilities Loans and Grants - Written Policies Required by the Uniform Guidance Material Weakness in Internal Control over Compliance Criteria: The Uniform Guidance requires a non-federal entity that has expended federal awards for a grant awarded on or after December 26, 2014 to have written policies pertaining to allowability of costs charged to federal programs, cash management, financial management, procurement, compensation/payroll, and travel costs (?200.300 - 328). Condition: Although the City has processes in place to cover these areas, the City lacks formal written policies covering these areas. Cause: This condition appears to be the result of a time lag in identifying the requirement and developing a plan for compliance. Effect: As a result of this condition, the City did not fully comply with the Uniform Guidance applicable to the above noted grants. Questioned Costs: No costs have been questioned as a result of this finding. Recommendation: We recommend that the City ensures these policies are updated to conform with the Uniform Guidance as soon as practical, but no later than the end of fiscal year 2023. View of Responsible Officials: We agree with the finding. The City is currently working on updating all current procedures and policies to ensure that they are compliant with Uniform Guidance for all current and future Federal Awards.

Corrective Action Plan

The City of Beaverton respectfully submits the following corrective action plan for the year ended June 30, 2022. Name and address of independent public accounting firm: Quast, Janke & Company 1010 N Johnson St Bay City, MI 48708 Audit Period: June 30, 2022 Contact person responsible for Corrective Action Kimberly Hines, City Manager The findings from the June 30, 2022 schedule of findings and questions costs are detailed in the schedule above. The findings are numbered consistently with the numbers assigned in the schedule. 2022-004 Written Policies Required by the Uniform Guidance Recommendation: We recommend that the City ensures these policies are updated to conform with the Uniform Guidance as soon as practical, but no later than the end of fiscal year 2023. Action Taken: The City has been provided an example of appropriate policies to use as a guide in updating their written policies. City management is currently working on updating all current procedures and policies to ensure that they are compliant with Uniform Guidance for all current and future Federal Awards. Anticipated Completion Date: June 2023

Other Findings in this Audit

23163 2022-004

Material Weakness
599604 2022-004

Material Weakness
599605 2022-004

Material Weakness

Programs in Audit

ALN	Program Name	Expenditures
11.003	Census Geography	$451,905
10.760	Water and Waste Disposal Systems for Rural Communities	$326,032
21.027	Coronavirus State and Local Fiscal Recovery Funds	$123,900
10.766	Community Facilities Loans and Grants	$61,950
16.710	Public Safety Partnership and Community Policing Grants	$58,902