Finding Text
Finding 2022-04 ? Fiscal Management System (Material Weakness) Criteria: CFR Part 200.302.b Auditee Responsibilities includes the requirement that the financial manage-ment system of each non-Federal entity provide the following. Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. Accurate, cur-rent, and complete disclosure of the financial results of each Federal award or program. Condition: During the audit of Umpqua Public Transportation District for Fiscal Year 2021-2022, the dis-trict provided auditor with Separate and Identifiable General Ledger reports that showed a clear division be-tween Federal, State and Local expenditures and revenues. However, the separation was done retroactivity and was not been completed for the entire fiscal year or life of grants. This deficiency was instrumental in causing the general ledger to be inadequate for financial and Federal Award Reporting. Cause: The District had originally relied on unskilled individuals for structuring and recording activities in their general ledger. District management did not have sufficient staff or monitoring policies to recognize and correct the deficiency. While trained staff have been hired at Umpqua Public Transportation District, and improvements made to the general ledger and recording of Federal grants, improvements are still nec-essary to meet the full requirements of CFR Part 200.302.b Auditee Responsibilities. Effect or Potential Effect: Potential for incorrect financial reporting, and untimely results, with the inabil-ity to rely on the general ledger for correct and timely information. Questioned Cost: No Context: While federal grant revenues and expenditures are now tracked using the general ledger ?jobs? indicators, additional recording is needed to track the matching portions of the costs and revenues of those federal grants. The lack of completed effort at separating revenues or expenditures by grant may lead to er-rors in reporting expenditures for Federal Awards. Repeat of a Prior-Year Finding: Yes, Findings and Questioned Costs 2021-11 Recommendation: We recommend that Umpqua Public Transportation District improve their general ledg-er structure to meet the requirement for separate accounts for Federal awards for program revenues and program expenditures. We also recommend that the district establish policies and procedures to ensure that all program revenues and expenditures are reported in the correct fiscal year. In addition, we recommend that the district establish a training program and policies and procedures for staff and management to re-ceive appropriate training for administering and recording Federal Grant revenues and expenditures. District's Response: The District concurs with the recommendation. General ledger accounts separating Federal, State, and Local revenues and related expenditures will be designed and implemented. Corrective Action Plan: The District has hired a Finance Manager to oversee the day-to-day financial operations of the district. The Finance Manager has developed an accounting system for separating Feder-al, State, and Local revenues and related expenditures. This will allow the activities of the district to be rec-orded in a manner that allows for reporting in compliance with federal requirements. Planned Implementation Date: July 1, 2022 Responsible Person: General Manager, Umpqua Public Transit District