Finding Text
SA2023 - 001 – MATERIAL WEAKNESS
FEDERAL PROGRAM: 20.106 Airport Improvement Program
SPECIFIC REQUIREMENT: Federal expenditures related to the program should be reported in the
fiscal year they are expended.
CONDITION: Adequate controls were not in place to ensure the schedule of expenditures of federal
awards was accurate at year end.
QUESTIONED COST: None noted
CONTEXT: This finding is limited to this major program and the context noted in the condition.
EFFECT: Without adequate controls or procedures in place to ensure accuracy of the schedule of
expenditures of federal awards there exists the risk of material misstatement.
CAUSE: The District did not have adequate knowledge for reporting their federal award expenditures
for compilation and reporting.
RECOMMENDATION: We recommend the District implement procedures to ensure accuracy of the
schedule of expenditures of federal awards.
VIEWS OF RESPONISBLE OFFICIALS: Though not identified specifically, there is a correlation to staff
turnover in key roles during the fiscal year under audit, and this federal award finding. Management
oversight is a key component of internal controls. The District believes with appropriate staffing at all
levels allows internal controls to function as designed. Beyond that, there are measures under
consideration which intend to mitigate this finding for the subsequent fiscal year end audit, such as:
Review and Reconciliation of Reported Expenditures – this process can be conducted on a
more frequent basis than only at closed of year end. This will function as an opportunity to for
both staff and management to become overly familiar with the transactions as they occur, the
procedure for recording, and the preparation of the schedule. Year-end preparation of the
Schedule of Expenditures of Federal Awards (SEFA) will then prove more routine and errors will
be more readily apparent.
Enhanced Controls and Processes – though the District maintains, reviews and updates the
Internal Control Document regularly, there are often opportunities to enhance controls which
when operating as designed will detect misstatement. Care will be taken to review processes
and ascertain where additional controls can be put in place to create appropriate checks and
balances in processes.
Staff Training – it is the intent of the District to ensure those charged with accounting tasks, as
well as those charged with review of accounting data and financial statements have the
appropriate experience. Assessment may be necessary to determine if opportunities exist for
additional training which will ensure appropriate accounting procedures, including financial
statement and SEFA preparation are done accurately and within generally accepted accounting
practices.
Engagement with Federal Awarding Agencies – opportunities may arise to converse federal
awarding agencies about recording and reporting guidelines; as needed, staff may need
additional training or guidance to ensure compliance with all guidelines.
Ongoing Monitoring – creating or updating existing monitoring processes and schedules can
ensure that review and validation of the accuracy of expenditure reporting remains in continuous
compliance with requirements.