Finding 553590 (2024-002)

Finding 2024-002 - Significant Deficiency and Noncompliance – Lack of Required Uniform Guidance Policies and Procedures Program Information: Water and Waste Disposal Systems for Rural Communities, U.S. Department of Agriculture, 92-06 / 92-07, 2022, ALN #10.760 Criteria: Written procedures specific to federal awards are required to comply with Uniform Guidance, including written procedures for financial management systems, payments, allowable costs, period of performance, matching or cost sharing, program income, procurement, equipment and real property, supplies, copyrights, subawards or debarred and suspended parties, monitoring and reporting program performance, financial reporting, retention and access requirements for records, cash management, and payroll or federal timekeeping. Condition: The City did not update their federal policies and procedures to be in full compliance with Uniform Guidance. Questioned Costs: None. Cause and Effect: The City has not historically received a significant amount of federal funding, therefore they have not implemented written policies and procedures specific to Uniform Guidance. While no noncompliance was noted during the audit, the lack of written federal policies and procedures that are in compliance with Uniform Guidance increases the risk of noncompliance within federal programs. Recommendation: We recommend that the City develop and adopt written policies and procedures that are in compliance with Uniform Guidance. Views of responsible officials: Management is in agreement with the finding. Corrective action plan: See attached.