Finding 576089 (2024-002)

Material Weakness

Requirement

Questioned Costs

Year

2024

Accepted

2025-09-10

Audit: 365992

Organization: City of Lewes, Delaware (DE)

Auditor: Pks & Company P A

AI Summary

Core Issue: The City submitted an inaccurate SLFRF Compliance P&E Annual Report, with totals not matching actual expenditures.
Impacted Requirements: The report must be filed within 30 days after the fiscal year ends, reflecting the City’s own expenditures, not those of subrecipients.
Recommended Follow-Up: The City should establish controls to ensure accurate reporting and will issue an amended report to correct the discrepancies.

Finding Text

Type of finding – Material Weakness in Internal Control over Compliance and Noncompliance Criteria – SLFRF Compliance P&E Annual Report should be submitted in accordance with the requirements of this report 30 days following the end of each fiscal year ending March 31. Condition – The totals submitted on the annual report did not match the expenditures incurred by the City. The City passed through funds to three subrecipients during the year to be used for preapproved projects allowed under the award. The City reported funds expended by the subrecipients to date, rather than the funds spent by the City. Cause – The City did not have a process in place to ensure an accurate SLFRF Compliance P&E Annual Report was filed. Effect – Required reporting and filing of the SLFRF Compliance P&E Report with accurate information will not be performed. Recommendation – The City should implement controls to be able to accurately report required reports, based on requirements of a Federal agreement. Management response and Corrective Action Plan: The City will issue an amended report to reflect the accurate totals.

Corrective Action Plan

Type of Finding: Material Weakness; Compliance Requirement: Reporting Finding Summary: The totals submitted on the SLFRF Compliance P&E Annual Report did not match the expenditures incurred by the City. The City passed through funds to three subrecipients during the year to be used for preapproved projects allowed under the award. The City reported funds expended by the subrecipients to date, rather than the funds incurred by the City. Responsible Individuals: Ellen Lorraine McCabe, City Manager Corrective Action Plan: The City has had significant turnover in management positions over the past few years. This was also the first year a single audit was required. New procedures will be implemented to controls surrounding federal programs to ensure accurate reporting. The City inquired about amending the report directly with the Treasury Department and is not required to resubmit the report. No further action is necessary. Anticipated Completion Date: August 29, 2025

Other Findings in this Audit

1152531 2024-002

Material Weakness

Programs in Audit

ALN	Program Name	Expenditures
21.027	Coronavirus State and Local Fiscal Recovery Funds	$1.42M
16.738	Edward Byrne Memorial Justice Assistance Grant Program	$14,900
20.616	National Priority Safety Programs	$7,663