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Consent
Item No. 5.8.
| MEETING DATE: 07/18/2022 |
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| TO: | HONORABLE MAYOR AND COUNCILMEMBERS |
| FROM: | JIM SADRO, CITY MANAGER By: Mel Shannon, Director of Finance |
| SUBJECT: | RECEIVE AND FILE THE FISCAL YEAR 2020-2021 SINGLE AUDIT OF FEDERALLY ASSISTED GRANT PROGRAMS REPORT
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RECOMMENDATION:
That the City Council receive and file the audited Fiscal Year 2020-2021 Single Audit of Federally Assisted Grant Programs (Single Audit) Report for the City of La Habra.
DISCUSSION:
At its regular meeting of May 2, 2022, City Council received and filed the following audited reports:
a) Fiscal Year 2020-2021 Annual Comprehensive Financial Report (ACFR) and;
b) Fiscal Year 2020-2021 Annual Financial Report for the La Habra Utility Authority.
At that time, the audit of the Single Audit report had not been completed due to a delay in the release of audit guidance by the Federal Office of Management and Budget. The Single Audit report has since been completed and is included herein as Attachment 1.
Cliffton Larson Allen LLP, an independent audit firm, reports “unmodified opinions” as it pertains to both the Financial Statements and to Federally Assisted Grant Programs. An unmodified opinion on financial statements means that financial statements are presented, in all material respects, in accordance with applicable accounting standards and regulations.
AUDIT FINDINGS
There were two audit findings with respect to the City’s Fiscal Year 2020-21 financial statements:
1. Auditors recommended that the City allocate the amount related to the Other Post-Employment Benefits (OPEB) plan each fiscal year to the enterprise funds.
2. Auditors recommended that the City evaluate the net realizable value of land held for resale and adjust the value of land held for resale to the lesser value of cost or net realizable value.
There were four audit findings with respect to the Fiscal Year 2020-2021 Federally Assisted Grant Programs:
1. Auditors recommend that the City implement controls to ensure the tier determination for day care homes is done every five years.
2. Auditors recommend that the City implement controls to ensure the age of children at day care homes meets program requirements.
3. Auditors recommend that the City improve controls to ensure that reimbursements are disbursed within five days of receipt from the Child Development State agency.
4. Auditors recommend that the City implement procedures to verify that an entity with which it plans to enter into a covered transaction is not debarred, suspended, or otherwise excluded, and design controls to ensure that the procedure is done for all covered transactions.
City staff agrees with the auditor’s findings and will implement their recommendations in the Fiscal Year 2021-2022 Financial Statements and Federally Assisted Grant Programs.
a) Fiscal Year 2020-2021 Annual Comprehensive Financial Report (ACFR) and;
b) Fiscal Year 2020-2021 Annual Financial Report for the La Habra Utility Authority.
At that time, the audit of the Single Audit report had not been completed due to a delay in the release of audit guidance by the Federal Office of Management and Budget. The Single Audit report has since been completed and is included herein as Attachment 1.
Cliffton Larson Allen LLP, an independent audit firm, reports “unmodified opinions” as it pertains to both the Financial Statements and to Federally Assisted Grant Programs. An unmodified opinion on financial statements means that financial statements are presented, in all material respects, in accordance with applicable accounting standards and regulations.
AUDIT FINDINGS
There were two audit findings with respect to the City’s Fiscal Year 2020-21 financial statements:
1. Auditors recommended that the City allocate the amount related to the Other Post-Employment Benefits (OPEB) plan each fiscal year to the enterprise funds.
2. Auditors recommended that the City evaluate the net realizable value of land held for resale and adjust the value of land held for resale to the lesser value of cost or net realizable value.
There were four audit findings with respect to the Fiscal Year 2020-2021 Federally Assisted Grant Programs:
1. Auditors recommend that the City implement controls to ensure the tier determination for day care homes is done every five years.
2. Auditors recommend that the City implement controls to ensure the age of children at day care homes meets program requirements.
3. Auditors recommend that the City improve controls to ensure that reimbursements are disbursed within five days of receipt from the Child Development State agency.
4. Auditors recommend that the City implement procedures to verify that an entity with which it plans to enter into a covered transaction is not debarred, suspended, or otherwise excluded, and design controls to ensure that the procedure is done for all covered transactions.
City staff agrees with the auditor’s findings and will implement their recommendations in the Fiscal Year 2021-2022 Financial Statements and Federally Assisted Grant Programs.
FISCAL IMPACT/SOURCE OF FUNDING:
There is no fiscal impact associated with receiving and filing the City’s Fiscal Year 2020-2021 Single Audit Report (Attachment 1).
GENERAL PLAN RELEVANCE/CITY COUNCIL GOALS & OBJECTIVES:
General Plan Relevance:
D 9 Fiscal Strength-Stability
City Council Goals & Objectives:
Goal 2-Management of Public Revenues and Fiscal Assets, Objective G-OMB Uniform Guidance provides a government-wide framework for federal grants management.
D 9 Fiscal Strength-Stability
City Council Goals & Objectives:
Goal 2-Management of Public Revenues and Fiscal Assets, Objective G-OMB Uniform Guidance provides a government-wide framework for federal grants management.