Finding Text
Federal program: Water and Waste Disposal Systems for Rural Communities
Assistance listing number: 10.760
Federal agency: U.S. Department of Agriculture
Pass-through entity: n/a – direct award
Pass-through entity identification number: n/a
Type of Finding: Significant deficiency in internal control over compliance.
Criteria: Per 2 CFR Section 200.302(b)(6), and 200.302(b)(7), a non-federal agency must establish written procedures related to the following: receipt of payment of federal funds and determination of allowability of costs in accordance with Subpart E – Cost Principles, respectively.
Condition: The Town has not formally adopted certain required written financial management policies as outlined in the Code of Federal Regulations.
Cause: Town personnel were unaware of this requirement.
Effect: Transactions could occur that did not comply with federal regulations.
Questioned costs: None
Repeat finding: The Town of Bridgewater, Vermont was not required to have a Single Audit for its prior fiscal year. Accordingly, this is not a repeat finding.
Perspective information: The finding was based on requesting the Town’s written financial policies related to federal compliance and therefore was not the result of a statistical sample.
Recommendation: The auditor recommends that the Town obtain an understanding of the required written policies in the Code of Federal Regulations as applicable to its federal programs, create and formally adopt those required policies.