Finding Text
Finding 2023-001 Equipment and Real Property Management - Significant Deficiency in Internal
Controls over Compliance
Agency Department of Transportation
ALN and Program
Name
20.106 – Airport Improvement Program, COVID-19 Airports Programs and
Infrastructure Investment and Jobs Act Programs
Criteria or Specific
Requirement
The regulations in 2 CFR Sections 200.313(d)(1) notes equipment and real
property records must be maintained that include ultimate disposition data
including the date of disposal and sales price of the property (2 CFR section
200.313(d)(1)).
Condition During the year, the City disposed of an asset related to the airport that had
been purchased with federal funding and applied the proceeds towards eligible
grant expenditures. However, the disposal was not initially recorded in the
accounting system and inventory records.
Cause The City did not have an appropriate control in place to ensure timely
maintenance of records for disposals of federal equipment and real property.
Effect or Potential
Effect
The City was not in compliance with Equipment and Real Property requirements
outlined in 2 CRF Sections 200.313, which could affect future awards.
Questioned costs Not applicable.
Context There was only one disposal during the year. The asset original cost was
$259,140; net book value at the time of the disposal was $25,914. The proceeds
from the sale of $8,100 were properly recorded in the books and records.
Identification as a
repeat finding
Not a repeat finding.
Recommendation We recommend the City reconcile disposals against sales at least annually and
continue to conduct asset inventory procedures at least biannually.
Views of
Responsible
Officials
Management agrees with the finding and plans to complete and review an
annual reconciliation of disposals against sales of assets.