Finding Text
Finding # 2023-002 (Repeat Finding 2022-002)
Type: Material weakness over property records
Assistance Listing Number:
14.218/14.228 Community Development Block Grants/ Entitlement Grants
Requirement:
Equipment should be used in the program or project for which it was
acquired, and all purchases of equipment and other capital assets (fixed
assets) with federal funds shall be approved, in advance and in writing, by the
County.
Condition/Context:
Equipment capitalization approvals could not be substantiated, and property
and equipment listings associated with federal funds were not reviewed.
Cause:
There are no formal policies for fixed asset capitalization and tracking
method for federal funding source.
Effect:
Improper or inaccurate amounts could be paid or charged to contracts.
Recommendation:
We recommend developing appropriate controls to account for proper
capitalization of fixed assets. Procedures should be put in place to ensure
reviews are completed timely as well.
Management’s Response:
Management has developed a fixed asset tracking schedule and intend to
modify the schedule to maintain details of federally purchased fixed assets.
Management also plan to implement an annual physical inventory of fixed
assets.