Finding Text
Finding 2022-002, Requirement L (Reporting) U.S. Department of Treasury COVID-19? Coronavirus State and Local Fiscal Recovery Funds (ARPA) ? ALN 21.027 Federal Award Year 2022 Finding: The City did not have sufficient controls to properly identity, track and report expenditures for the required quarterly reports for ALN 21.027 and proper reporting of Schedule of expenditures of federal awards (SEFA). Criteria: The City should be reporting in a timely manner (30 days after quarter end) all ARPA expenditures and reporting them on the SEFA based on when expended. Condition: The City recorded all dollars transferred out of the special revenue fund created for the program as expenditures on the SEFA and the required reports even if the dollars were not truly expended. The SEFA was subsequently adjusted to accurately report the expenditures. The City reported expenditures based on Council approval of dollars and not when the funds were expended. Cause: The City?s controls were not operating effectively to ensure that the ARPA expenditures were being identified, tracked, and reported. Effect: Potential for improper reporting can result in actions taken by oversight agencies which could impact future funding. Questioned costs: None Context: Two quarterly reports were tested and one included expenditures that had not been properly identified. Recommendation: We recommend that the City implement controls to ensure that the ARPA expenditures are properly identified, tracked and reported. City management?s response: Management agrees with this finding.