Finding Text
Finding – Delinquent Single Audit Reporting
Condition:
During our review of internal control over compliance, it was noted that the single audit was not filed in a timely manner in accordance with the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance).
Criteria:
The audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) state the Single Audit must be completed and the reporting required must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period, unless a different period is specified in a program-specific audit guide.
Effect:
The City is not in compliance with the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance).
Recommendation:
We recommend that the City implement policies and procedures to ensure compliance with Single Audit requirements in future fiscal periods.
Management Response:
For fiscal year 2022-23 the City of Hughson had expenditures over $750,000. This is the threshold that triggers the requirement for a single audit. The City did not meet this requirement for the past two fiscal years. The monies spent from the Coronavirus State and Local Fiscal Recovery Funds (Fund 380) totaled $667,147, the monies spent from the Transportation Street Projects (Fund 420) totaled $450 and Public Works Street Projects (Fund 425) totaled $21,173. The total for these expenditures was $688,770.
Initially management categorized expenditures for the replacement of Well #7 as state-funded, under the California State Water Board. However, in April of 2024 management became aware that the portion of the funding for this project considered a loan is federally funded. Armed with this new information, management directed Moss-Levy to perform a single audit for FY22-23 for the City of Hughson.
Future funding for the City of Hughson will be thoroughly vetted to determine if there are any federal funds included in the monies to be received. Each new source of funding will be documented as to the source of the funding and the restrictions on its use. A thorough review of these funds will be made at year end to determine if the City has met the $750,000 threshold to request a single audit in a timely manner.