Finding Text
Criteria: The City is required to file quarterly Project and Expenditure reports that detail financial data, projects funded, expenditures, and contracts and subawards over $50,000, that were paid with the Coronavirus State and Local Fiscal Recovery Funds (CSLFRF). Condition: The Project and Expenditure report filed by the City for the quarter ended June 30, 2022, reported that there were no current or cumulative expenditures in the Replace Lost Revenue category. The City recognized $3,554,003 in expenditures to Replace Lost Revenue during the year ended June 30, 2022, and $2,547,800 in expenditures to Replace Lost Revenue during the year ended June 30, 2021. Cause: A deficiency in the operation of internal controls resulted in the City not reporting expenditures in the Replace Lost Revenue category on their Project and Expenditure report. Effect: As a result, total expenditures in the CSLFRF grant were understated on the June 30, 2022, Project and Expenditure report by approximately $6,102,000. Recommendation: We recommend that the City improve its process for completing and approving the Project and Expenditure reports. The total expenditures on the Project and Expenditure reports should be reconciled to current and cumulative expenditures reported by the City in the ARPA fund. Management?s Response: Management acknowledges that there have been deficiencies in processes. The City intends to enhance its internal controls over ARPA reporting. These efforts will be accomplished through improved internal communication and training of staff to ensure proper reporting of the Replace Lost Revenue category.