Finding 508428 (2023-005)

Material Weakness Repeat Finding
Requirement
B
Questioned Costs
-
Year
2023
Accepted
2024-11-20
Audit: 329052
Organization: Town of Livermore Falls (ME)

AI Summary

  • Core Issue: The Town lacks proper internal controls, leading to missing approvals for expenses before issuing checks.
  • Impacted Requirements: This violates 2 CFR 200.303, risking improper allocation of expenses and potential reimbursement issues with federal funds.
  • Recommended Follow-Up: The Town should create and enforce a documented approval process to ensure only allowable costs are charged to the program.

Finding Text

2023-005 - Allowable Costs/Cost Principles Federal Program Information: ALN - 66.458 - Clean Water State Revolving Funds Criteria: The following CFR(s) apply to this finding: 2 CRF 200.303 Condition: During audit procedures, it was identified that the Town does not have invoices and board warrants approved before issuing checks. Cause: The Town does not have the necessary internal controls over compliance. Lack of supervisory oversight. Effect: Expenses may not be properly allocated to the grant; this could result in unallowable expenses being charged and subsequently improperly reimbursed by federal funds Identification of Questioned Costs: None identified. Context: The population consisted of 12 out of 38 transactions. Of the 12 samples, 4 did not have consistent document approvals from the Town Manager to ensure that only allowable costs were being charged to the program and 7 out of 12 were lacking Select Board approvals. Repeat Finding: This is a repeat finding of 2022-006. Recommendation: It is recommended that the Town develop and implement policies and procedures for documented approval process to ensure that only allowable costs are charged to the program. 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

CORRECTIVE ACTION PLAN (Concerning Finding 2023-005) Contact Person Responsible for Corrective Action: Carrie Castonguay, Town Manager Corrective Action: The Treasurer, Town Manager and Select Board will take the following actions to address finding 2023-005 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, had approved and us using the new Internal Controls Policy that addresses this deficiency. Additionally, Department Heads are required to turn in no later than Thursday by 9 am, invoices to be paid on that week’s warrant. The Treasurer has been given authority by the Town Manager to contact Department Heads and request that they come to the office weekly to turn in invoices. All invoices must have the appropriate expense code and be signed by the Department Head. Anticipated Completion Date: This was completed January 23, 2024.

Categories

Allowable Costs / Cost Principles Internal Control / Segregation of Duties

Other Findings in this Audit

  • 508426 2023-003
    Material Weakness Repeat
  • 508427 2023-004
    Significant Deficiency Repeat
  • 508429 2023-006
    Significant Deficiency Repeat
  • 508430 2023-007
    Significant Deficiency
  • 508431 2023-005
    Material Weakness Repeat
  • 508432 2023-006
    Significant Deficiency Repeat
  • 508433 2023-007
    Significant Deficiency
  • 508434 2023-005
    Material Weakness Repeat
  • 508435 2023-006
    Significant Deficiency Repeat
  • 508436 2023-007
    Significant Deficiency
  • 508437 2023-005
    Material Weakness Repeat
  • 508438 2023-006
    Significant Deficiency Repeat
  • 508439 2023-007
    Significant Deficiency
  • 1084868 2023-003
    Material Weakness Repeat
  • 1084869 2023-004
    Significant Deficiency Repeat
  • 1084870 2023-005
    Material Weakness Repeat
  • 1084871 2023-006
    Significant Deficiency Repeat
  • 1084872 2023-007
    Significant Deficiency
  • 1084873 2023-005
    Material Weakness Repeat
  • 1084874 2023-006
    Significant Deficiency Repeat
  • 1084875 2023-007
    Significant Deficiency
  • 1084876 2023-005
    Material Weakness Repeat
  • 1084877 2023-006
    Significant Deficiency Repeat
  • 1084878 2023-007
    Significant Deficiency
  • 1084879 2023-005
    Material Weakness Repeat
  • 1084880 2023-006
    Significant Deficiency Repeat
  • 1084881 2023-007
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
10.760 Water and Waste Disposal Systems for Rural Communities $1.34M
21.027 Coronavirus State and Local Fiscal Recovery Funds $25,729
66.458 Clean Water State Revolving Fund $12,689