Finding 370151 (2022-007)

Significant Deficiency Repeat Finding

Requirement

Questioned Costs

Year

2022

Accepted

2024-02-22

Audit: 291679

Organization: Town of Livermore Falls (ME)

Auditor: Rhr Smith and Company

AI Summary

Core Issue: The Town lacks a cash management policy, risking the safeguarding of liquid assets.
Impacted Requirements: This finding violates 2 CFR sections 200.302(b)(6) and 200.305(b)(3).
Recommended Follow-up: The Town should adopt a compliant cash management policy and establish internal controls to ensure adherence.

Finding Text

2022-007 - 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 12 out of the 30 pay requisition deposit of reimbursements from the fiscal year were examined. Out of the 12 selections only 4 deposits had backup documentation and those 4 were not properly recorded. The other 8 were lacking proof that deposits were recorded properly. Repeat Finding: This is a repeat finding of 2021-006. 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

The Treasurer, Town Manager and Select Board has taken the following actions to address finding 2022-007: 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 a new Procurement Policy that addresses this deficiency. This policy was approved and implemented by the Select Board on January 23, 2024.

Other Findings in this Audit

370147 2022-003

Material Weakness Repeat
370148 2022-004

Significant Deficiency Repeat
370149 2022-005

Material Weakness
370150 2022-006

Material Weakness Repeat
370152 2022-006

Material Weakness Repeat
370153 2022-007

Significant Deficiency Repeat
370154 2022-006

Material Weakness Repeat
370155 2022-007

Significant Deficiency Repeat
946589 2022-003

Material Weakness Repeat
946590 2022-004

Significant Deficiency Repeat
946591 2022-005

Material Weakness
946592 2022-006

Material Weakness Repeat
946593 2022-007

Significant Deficiency Repeat
946594 2022-006

Material Weakness Repeat
946595 2022-007

Significant Deficiency Repeat
946596 2022-006

Material Weakness Repeat
946597 2022-007

Significant Deficiency Repeat

Programs in Audit

ALN	Program Name	Expenditures
10.760	Water and Waste Disposal Systems for Rural Communities	$1.37M
21.027	Coronavirus State and Local Fiscal Recovery Funds	$974,271
66.458	Capitalization Grants for Clean Water State Revolving Funds	$444,559