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HomeMy WebLinkAbout1998-01-13; City Council; 14518 Exhibit 2; SINGLE AUDIT REPORT ON FEDERAL AWARD PROGRAMS JUNE 30, 1997e e * CITY OF CARLSBAD Carlsbad, California Single Audit Report on e Federal Award Programs Year ended June 30,1997 a 0 a a 0 CITY OF CARLSBAD Single Audit Report on Federal Award Programs Year ended June 30,1997 e e TABLE OF CONTENTS Pap Report on Compliance and on Internal Control over Financial Reporting Based on an Audit of Financial Statements e Performed in Accordance with Government Auditing Standards 1 Report on Compliance with Requirements Applicable to Each Major Program, Internal Control over Compliance and on the Schedule of Federal Awards in Accordance with OMB Circular A- 1 33 2 Schedule of Federal Awards 4 Notes to Schedule of Federal Awards 5 0 Schedule of Findings and Questioned Costs 6 7 0 Summary Schedule of Prior Audit Findings 0 0 0 e e e CERTIFIED PUBLIC ACCOUb 11 00 MAIN STREEl IRVINE, CALIFORh (71 4) CONRAD %SSOCII\TES. A PARTNERSHIP INCLUDING PROFESSIONAL CORPORATIONS L.L.p e The Honorable Members of City Council City of Carlsbad Carlsbad, California e REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIA REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMI IN ACCORDANCE WITH GOVEWMENTAUDITING STANDARDS We have audited the financial statements of the City of Carlsbad (City) as of and for the ; ended June 30, 1997, and have issued our report thereon dated October 3, 1997. We condu our audit in accordance with generally accepted auditing standards and the standards applic to financial audits contained in Government Auditing Standards, issued by the Comptrc General of the United States. e Compliance As part of obtaining reasonable assurance about whether the City’s financial statements are of material misstatement, we performed tests of its compliance with certain provisions of 1; regulations, contracts and grants, noncompliance with which could have a direct and matt effect on the determination of financial statement amounts. However, providing an opinior compliance with those provisions was not an objective of our audit and, accordingly, we do express such an opinion. The results of our tests disclosed no instances of noncompliance thal required to be reported under Government Auditing Standards. Internal Control Over Financial Reporting In planning and performing our audit, we considered City’s internal control over finan reporting in order to determine our auditing procedures for the purpose of expressing our opiI on the financial statements and not to provide assurance on the internal control over finan reporting. Our consideration of the internal control over financial reporting would necessarily disclose all matters in the internal control over financial reporting that mighi material weaknesses. A material weakness is a condition in which the design or operation of or more of the internal control components does not reduce to a relatively low level the risk misstatements in amounts that would be material in relation to the financial statements bt audited may occur and not be detected within a timely period by employees in the normal coi of performing their assigned functions. We noted no matters involving the internal control ( financial reporting and its operation that we consider to be material weaknesses. However, noted other matters involving internal control over financial reporting that we have reportel management of the City in a separate letter dated October 3, 1997. This report is intended for the information of the City’s management and federal awarc agencies and pass-through entities. However, this report is a matter of public record anc distribution is not limited. e * e 0 e &ad4 A+GG @&hb d L a A- 4 October 3, 1997 1 MEMBERS OF AlCPA AND CALIFORNIA SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS MEMBER OF AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS PRIVATE COMPANIES PRACTICE SECTION e CERTIFIED PUBLIC ACCOU 11 00 MAIN STREI IRVINE, CALIFOR (71 4 CONRAD %SSOCLZTES, A PARTNERSHIP INCLUDING PROFESSIONAL CORPORATIONS L.L.R a The Honorable Members of City Council City of Carlsbad Carlsbad, California a REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACl MAJOR PROGRAM, INTERNAL CONTROL OVER COMPLIANCE AND ON THE SCHEDULE OF FEDERAL AWARDS IN ACCORDANCE WITH OMB CIRCULAR A-133 e Compliance We have audited the compliance of the City of Carlsbad (City) with the types of compli requirements described in the L? S. Office of Management and Budget (OMB) Circular A Compliance Supplement that are applicable to each of its major federal programs for the ended June 30, 1997. The City’s major federal programs are identified in the summar auditor’s results section of the accompanying schedule of findings and questioned c Compliance with the requirements of laws, regulations, contracts and grants applicable to eac its major federal programs is the responsibility of the City’s management. Our responsibih to express an opinion on the City’s compliance based on our audit. We conducted our audit of compliance in accordance with generally accepted auditing stand: the standards applicable to financial audits contained in Government Auditing Standards, is: by the Comptroller General of the United States; and OMB Circular A-133, Audits of St, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A require that we plan and perform the audit to obtain reasonable assurance about whc noncompliance with the types of compliance requirements referred to above that could ha direct and material effect on a major federal program occurred. An audit includes examining a test basis, evidence about the City’s compliance with those requirements and performing other procedures as we considered necessary in the circumstances. We believe that our i provides a reasonable basis for our opinion. Our audit does not provide a legal determinatio the City’s compliance with those requirements. In our opinion, the City complied, in all material respects, with the requirements referre above that are applicable to each of its major federal programs for the year ended June 30, 1 However, we noted certain immaterial instances of noncompliance that we have reporte management of the City in a separate letter dated October 3, 1997. Internal Control Over Compliance The management of the City is responsible for establishing and maintaining effective inte control over compliance with requirements of laws, regulations, contracts and grants applic to federal programs. In planning and performing our audit, we considered the City’s inte control over compliance with requirements that could have a direct and material effect on a m federal program in order to determine our auditing procedures for the purpose of expressing opinion on compliance and to test and report on internal control over compliance in accord; with OMB Circular A-1 33. e e e e a e 2 MEMBERS OF AICPA AND CALIFORNIA SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS MEMBER OF AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS PRIVATE COMPANIES PRACTICE SECTION e e The Honorable Members of City Council City of Carlsbad Page Two 0 Our consideration of the internal control over compliance would not necessarily disclosl matters in the internal control that might be material weaknesses. A material weakness condition in which the design or operation of one or more of the internal control compor does not reduce to a relatively low level the risk that noncompliance with applic requirements of laws, regulations, contracts and grants that would be material in relation major federal program being audited may occur and not be detected within a timely perioc employees in the normal course of performing their assigned functions. We noted no ma involving the internal control over compliance and its operation that we consider to be mat1 Schedule of Federal Awards We have audited the financial statements of the City as of and for the year ended June 30, 1 and have issued our report thereon dated October 3, 1997. Our audit was performed for purpose of forming an opinion on the financial statements taken as a whole. The accompan, schedule of federal awards is presented for purposes of additional analysis as required by 0 Circular A-133 and is not a required part of the financial statements. Such information has 1 subjected to the auditing procedures applied in the audit of the financial statements and, in opinion, is fairly stated, in all material respects, in relation to the financial statements taken whole. This report is intended for the information of the City’s management and federal aware agencies and pass-through entities. However, this report is a matter of public record anc distribution is not limited. 0 e weaknesses. * 0 &&l/$q 4dUC?kb, L4.4 0 October 3, 1997 0 0 0 3 0 CITY OF CARLSBAD Schedule of Federal Awards Year ended June 30, 1997 e Catalog of Federal Federal Grantor/ Domestic Program Federal Federal A Pass-through Grantor/ Assistance Identification Awards Awards Prc Program Title Number Number Received Expenditures Sub e U.S. Department of Housing and Urban Development Direct Assistance: e Section 8 Housing Certificate Program 14.857 CA16E077006/016 $1,889,253 2,090,679* Section 8 Housing Voucher Program 14.855 CA16V007002/006 656,150 638,624* Community Development Block Grant 14.2 18 B93MC060563 607,406 572,187 465 Subtotal 3,152.809 3,301,490 465 e U.S. Department of Health and Human Services Pass-through from the County of San Diego: Senior Nutrition Program 93.045 34111 30,820 69,057 - U.S. Department of Agriculture Pass-through from the County of San Diego: 0 Senior Nutrition Program 10.558 34111 25,605 25,605 - U.S. Department of Education Pass-through from the California State Library: Library Services . 84.034 40-4300 5,000 - U.S. Department of Justice Direct Assistance: e 21,282 - 83,130 Law Enforcement Block Grant 16.592 96-LB-VX-2840 U.S. Department of Interior-National Fish and Wildlife Foundation Direct Assistance: Habitat Management Plan (WS) 15.608 14-48-001 -94586 23,507 23,477 e Pass-through from the San Diego Association of Governments (SANDAG): Habitat Management Plan (WF) 15.608 14-16-0001-9 1546 4,322 - Subtotal 23,507 27,799 - e U.S. Department of Transportation Pass-through from the California Department of Transportation: Highway Bridge Repair and Replacement 20.205 11-1 17264 9,837 Internodal Surface Transportation Efficiency Act - Bike Lanes 20.205 11-1199914 395,734 421,302 - a Subtotal 405,571 421,302 L Federal Emergency Management Agency Direct Assistance: Harmony Grove Disaster Assistance 83.516 073-1 1194 318,533* - Hosp Grove Fire Hazard Mitigation 83.01 1 58-0101-0-1-999 49,632 2 Subtotal 368,165 : e $3,726,442 4,234,700 465, - Total federal financial awards * Major program See accompanying notes to schedule of federal awards. 4 e 0 CITY OF CARLSBAD Notes to the Schedule of Federal Awards Year ended June 30, 1997 0 0 (1) Summary of Significant Accounting; Policies Applicable to the Schedule of Fed Awards (a) Scope of Presentation The accompanying schedule presents only the expenditures incurred (and reli awards received) by the City of Carlsbad (City) that are reimbursable UI programs of federal agencies providing financial assistance. For the purposes of. schedule, financial assistance includes both federal financial assistance recei directly fiom a federal agency, as well as federal funds received indirectly by City from a non-federal agency or other organization. Only the portion of progi expenditures reimbursable with such federal funds are reported in the accompany schedule. Program expenditures in excess of the maximum federal reimbursem authorized or the portion of the program expenditures that were funded with st local or other non-federal funds are excluded fi-om the accompanying schedule. 0 4D (b) Basis of Accounting 0 The expenditures included in the accompanying schedule were reported on modified accrual basis of accounting. Under the modified accrual basis accounting, expenditures are incurred when the City becomes obligated for payrr as a result of the receipt of the related goods and services. Expenditures repoi included any property or equipment acquisitions incurred under the federal progra 0 (c) Cash Receipts Cash receipts reported in the accompanying schedule include the total amounl awards actually received from the funding agency on a cash basis during the fi: year reported on, which is July 1 , 1996 through June 30, 1997. 0 (d) Subrecipients During the fiscal year ended June 30, 1997, the City disbursed $465,979 of Community Development Block Grant to various subrecipients to be used for allowable expenditures as provided in this grant agreement. 0 e 5 0 a CITY OF CARLSBAD Schedule of Findings and Questioned Costs Year ended June 30,1997 e a (A) Summary of Auditors’ Results 1. An unqualified report was issued by the auditors on the financial statements o audi tee. There were no material weaknesses in internal control over financial reportiq were there any reportable conditions, based upon our audit of the fina statements of the auditee. The audit disclosed no noncompliance which is material to the financial staten of the auditee. There were no material weaknesses or other reportable conditions in internal co. over major programs of the auditee. An unqualified report was issued by the auditors on compliance for major progra The audit disclosed no audit findings required by the auditors to be reported u paragraph .510(a) of OMB Circular A-133. The major programs of the auditee were CFDA No. 14.857 and 14.855 Department of Housing and Urban Development - Section 8 Housing Certificate Voucher programs; and CFDA No. 83.516 Federal Emergency Management Ag - Harmony Grove - Disaster Assistance. The dollar threshold used to distinguish Type A and Type B programs was $300,1 The auditee was not considered as a low risk auditee for the year ended June 1997. 2. e 3. a 4. 5. 6. a 7. e 8. 9, a ) Findings Related to the Financial Statements which are Required to be Reportel Accordance with GAGAS There were no auditors’ findings required to be reported in accordance with GAGAS. Findings and Ouestioned Costs for Federal Awards as Defined in Paramaph .510(a OMB Circular A-133 There were no auditors’ findings to be reported in accordance with paragraph .5 1 O(a OMB Circular A-133. e IC) a 6 e e CITY OF CARLSBAD Summary Schedule of Prior Audit Findings Year ended June 30,1997 e e The following is the status of the audit findings for the year ended June 30, 1997: 96-1 Improve Accuracy of Housing Authority Forms - partial resolution occurred on finding. The first two areas of the recommendation were not resolved, however, au has determined that this portion of the prior year finding is not a material instanc noncompliance and therefore not required to be reported in this report and has reported to the City’s management in a separate letter dated October 3, 1997. corrective action that the City did take was in regard to the miscalculation of a ten total annual income. This error originally resulted in the tenant paying an additj $84.00 for her rent which she did not owe. The City rectified their mistake and remit check in the amount of $84.00 to the tenant for her over-payment of rent. Strengthen Controls Over Family Self-Sufficiency (FSS) Program - the recommenda- suggested have been implemented for the fiscal year ended June 30, 1997. Intemretation of Ambiguous Grant Contract - the recommendation suggested has implemented for the fiscal year ended June 30, 1997. Need to Submit Quarterly ReDorts to FEMA - the recommendation suggested has been implemented, however, auditor has determined that this portion of the prior finding is not a material instance of noncompliance and therefore not required tc reported in this report and has been reported to the City’s management in a separate 1 dated October 3, 1997. e e 96-2 96-3 e 96-4 e e e e 7 e