Maricopa County, Arizona single audit reporting package year ended ...

              Single Audit
A REPORT
TO THE
ARIZONA LEGISLATURE
Maricopa County
June 30, 2002
Financial Audit Division
Debra K. Davenport
Auditor General
The Auditor General is appointed by the Joint Legislative Audit Committee, a bipartisan committee composed of five
senators and five representatives. Her mission is to provide independent and impartial information and specific
recommendations to improve the operations of state and local government entities. To this end, she provides financial
audits and accounting services to the State and political subdivisions, investigates possible misuse of public monies, and
conducts performance audits of school districts, state agencies, and the programs they administer.
Copies of the Auditor General’s reports are free.
You may request them by contacting us at:
Office of the Auditor General
2910 N. 44th Street, Suite 410 • Phoenix, AZ 85018 • (602) 553-0333
Additionally, many of our reports can be found in electronic format at:
www.auditorgen.state.az.us
Maricopa County
Single Audit Reporting Package
June 30, 2002
Table of Contents Page
Comprehensive Annual Financial Report
Issued separately
Reports on Compliance and Internal Control
Report on Compliance and on Internal Control over Financial Reporting
Based on an Audit of Financial Statements Performed
in Accordance with Government Auditing Standards 1
Report on Compliance with Requirements Applicable to Each Major
Program and on Internal Control over Compliance in Accordance
with OMB Circular A-133 3
Schedule of Expenditures of Federal Awards 6
Schedule of Findings and Questioned Costs
Summary of Auditors’ Results 12
Federal Award Findings and Questioned Costs 13
County Responses
Corrective Action Plan 16
Summary Schedule of Prior Audit Findings 19
2910 NORTH 44th STREET • SUITE 410 • PHOENIX, ARIZONA 85018 • (602) 553 -0333 • FAX (602) 553-0051
DEBRA K. DAVENPORT, CPA
AUDITOR GENERAL
STATE OF ARIZONA
OFFICE OF THE
AUDITOR GENERAL WILLIAM THOMSON
DEPUTY AUDITOR GENERAL
Independent Auditors’ Report on Compliance and on Internal Control over
Financial Reporting Based on an Audit of Financial Statements
Performed in Accordance with Government Auditing Standards
Members of the Arizona State Legislature
The Board of Supervisors of
Maricopa County, Arizona
We have audited the financial statements of Maricopa County as of and for the year ended June 30, 2002,
and have issued our report thereon dated January 21, 2003, which was modified as to consistency
because of the implementation of Governmental Accounting Standards Board Statement No. 34 and a
change in accounting principle affecting the reporting of compensated absences and due to our reliance
on the report of other auditors. We conducted our audit in accordance with U.S. generally accepted
auditing standards and the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller General of the United States.
Compliance
As part of obtaining reasonable assurance about whether the County’s financial statements are free of
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts, and grants, noncompliance with which could have a direct and material effect on the
determination of financial statement amounts. However, providing an opinion on compliance with those
provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The
results of our tests and the reports of the other auditors disclosed no instances of noncompliance that are
required to be reported under Government Auditing Standards. However, we noted certain immaterial
instances of noncompliance that we will report to the County’s management in a separate letter.
Internal Control over Financial Reporting
In planning and performing our audit, we considered the County’s internal control over financial reporting
in order to determine our auditing procedures for the purpose of expressing our opinion on the financial
statements and not to provide assurance on internal control over financial reporting. Our consideration of
internal control over financial reporting would not necessarily disclose all such internal control matters that
might be material weaknesses. A material weakness is a condition in which the design or operation of one
or more of the internal control components does not reduce to a relatively low level the risk that
misstatements in amounts that would be material in relation to the financial statements being audited may
occur and not be detected within a timely period by employees in the normal course of performing their
assigned functions. We and the reports of the other auditors noted no matters involving internal control
over financial reporting and its operation that we and the other auditors consider to be material
weaknesses. However, we noted other matters involving internal control over financial reporting that we will
report to the County’s management in a separate letter.
2
This report is intended solely for the information and use of the members of the Arizona State Legislature,
the Board of Supervisors, federal awarding agencies, and pass-through entities and is not intended to be
and should not be used by anyone other than these specified parties. However, this report is a matter of
public record, and its distribution is not limited.
Dennis L. Mattheisen, CPA
Financial Audit Director
January 21, 2003
2910 NORTH 44th STREET • SUITE 410 • PHOENIX, ARIZONA 85018 • (602) 553 -0333 • FAX (602) 553-0051
DEBRA K. DAVENPORT, CPA
AUDITOR GENERAL
STATE OF ARIZONA
OFFICE OF THE
AUDITOR GENERAL WILLIAM THOMSON
DEPUTY AUDITOR GENERAL
Independent Auditors’ Report on Compliance with Requirements
Applicable to Each Major Program and on Internal Control over Compliance in
Accordance with OMB Circular A-133
Members of the Arizona State Legislature
The Board of Supervisors of
Maricopa County, Arizona
Compliance
We have audited the compliance of Maricopa County with the types of compliance requirements
described in the U.S. Office of Management and Budget (OMB) Circular A-133 Compliance Supplement
that are applicable to each of its major federal programs for the year ended June 30, 2002, except for that
portion of the federal programs administered by the Maricopa County Housing Department, which
includes the following programs: Public and Indian Housing, Public and Indian Housing Drug Elimination
Program, Resident Opportunity and Supportive Services, Section 8 Housing Choice Vouchers, and Public
Housing Capital Fund. The Maricopa County Housing Department was audited by other auditors whose
reports have been furnished to us, and our opinion, insofar as it relates to the Department’s compliance
with the types of compliance requirements described in the OMB Circular A-133 Compliance Supplement,
is based solely on the reports of the other auditors. The County’s major federal programs are identified in
the Summary of Auditors’ Results section of the accompanying Schedule of Findings and Questioned
Costs. Compliance with the requirements of laws, regulations, contracts, and grants applicable to each of
its major federal programs is the responsibility of the County’s management. Our responsibility is to
express an opinion on the County’s compliance based on our audit and the reports of the other auditors.
We conducted our audit of compliance in accordance with U.S. generally accepted auditing standards;
the standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States; and OMB Circular A-133, Audits of States, Local Governments,
and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform
the audit to obtain reasonable assurance about whether noncompliance with the types of compliance
requirements referred to above that could have a direct and material effect on a major federal program
occurred. An audit includes examining, on a test basis, evidence about the County’s compliance with
those requirements and performing such other procedures as we considered necessary in the
circumstances. We believe that our audit and the reports of the other auditors provide a reasonable basis
for our opinion. Our audit does not provide a legal determination on the County’s compliance with those
requirements.
4
As described in item 02-103 in the accompanying Schedule of Findings and Questioned Costs, the
County did not comply with requirements regarding subrecipient monitoring that are applicable to its
Consolidated Knowledge Development and Application Program. Compliance with such requirements is
necessary, in our opinion, for the County to comply with requirements applicable to that program.
In our opinion, based on our audit and the reports of the other auditors, except for the noncompliance
described in the preceding paragraph, Maricopa County complied, in all material respects, with the
requirements referred to above that are applicable to each of its major federal programs for the year
ended June 30, 2002. The results of our auditing procedures also disclosed other instances of
noncompliance with those requirements that are required to be reported in accordance with OMB Circular
A-133 and are described in the accompanying Schedule of Findings and Questioned Costs as items 02-
101 and 02-102.
Internal Control over Compliance
The County’s management is responsible for establishing and maintaining effective internal control over
compliance with requirements of laws, regulations, contracts, and grants applicable to federal programs.
In planning and performing our audit, we considered the County’s internal control over compliance with
requirements that could have a direct and material effect on a major federal program in order to determine
our auditing procedures for the purpose of expressing our opinion on compliance and to test and report
on internal control over compliance in accordance with OMB Circular A-133.
We noted certain matters involving internal control over compliance and its operation that we consider to
be reportable conditions. Reportable conditions involve matters coming to our attention relating to
significant deficiencies in the design or operation of internal control over compliance that, in our judgment,
could adversely affect the County’s ability to administer a major federal program in accordance with
applicable requirements of laws, regulations, contracts, and grants. Reportable conditions are described
in the accompanying Schedule of Findings and Questioned Costs as items 02-101, 02-102, and 02-103.
A material weakness is a condition in which the design or operation of one or more internal control
components does not reduce to a relatively low level the risk that noncompliance with applicable
requirements of laws, regulations, contracts, and grants that would be material in relation to a major
federal program being audited may occur and not be detected within a timely period by employees in the
normal course of performing their assigned functions. Our consideration of internal control over
compliance would not necessarily disclose all such internal control matters that might be reportable
conditions and, accordingly, would not necessarily disclose all reportable conditions that are also
considered to be material weaknesses. However, of the reportable conditions described above, we
consider item 02-103 to be a material weakness.
5
Schedule of Expenditures of Federal Awards
We have audited the County’s financial statements as of and for the year ended June 30, 2002, and have
issued our report thereon dated January 21, 2003, which was modified as to consistency because of the
implementation of Governmental Accounting Standards Board Statement No. 34 and a change in
accounting principle affecting the reporting of compensated absences and due to our reliance on the
report of other auditors. Our audit was made for the purpose of forming an opinion on the financial
statements taken as a whole. The accompanying Schedule of Expenditures of Federal Awards is
presented for purposes of additional analysis as required by OMB Circular A-133 and is not a required
part of the financial statements. Such information has been subjected to the auditing procedures applied
in the audit of the financial statements and, in our opinion, based on our audit and the reports of the other
auditors is fairly stated, in all material respects, in relation to the financial statements taken as a whole.
This report is intended solely for the information and use of the members of the Arizona State Legislature,
the Board of Supervisors, federal awarding agencies, and pass-through entities and is not intended to be
and should not be used by anyone other than these specified parties. However, this report is a matter of
public record, and its distribution is not limited.
Dennis L. Mattheisen, CPA
Financial Audit Director
April 30, 2003, except for the
Schedule of Expenditures of Federal
Awards, for which the date is January 21, 2003
Maricopa County
Schedule of Expenditures of Federal Awards
Year Ended June 30, 2002
CFDA/
Identifying
Federal Grantor / Program Title / Number Pass-Through
Pass-Through Grantor (Note 2) Grantor's Number Expenditures
U.S. Office of National Drug Control Policy
High Intensity Drug Trafficking Areas, Pima County 07.I0PSAP549 01-11-M-124247-1097,
01-11-M-125806-1098,
01-11-M-128024-1099 $ 174,512
U.S. Department of Agriculture
Food Donation, Arizona Department of Education 10.550 KR10358 66,580
Child Nutrition Cluster
School Breakfast Program, Arizona Department of Education 10.553 KR10358 210,885
National School Lunch Program, Arizona Department
of Education 10.555 KR10358 322,146
Special Supplemental Nutrition Program for Women,
Infants, and Children, Arizona Department of Health Services 10.557 761087, 261057, 261166 6,294,334
Child and Adult Care Food Program, Arizona Department of
Education 10.558 09CH7096 152,022
State Administrative Matching Grants for Food
Stamp Program, Arizona Department of Health Services 10.561 061002, 161043, 261088 86,060
Commodity Supplemental Food Program, Arizona Department of
Health Services 10.565 761117 123,035
Schools and Roads—Grants to States, Arizona State Treasurer 10.665 None 138,882
Total U.S. Department of Agriculture 7,393,944
U.S. Department of Housing and Urban Development
Community Development Block Grants/Entitlement Grants 14.218 3,224,184
Emergency Shelter Grants Program 14.231 113,955
Supportive Housing Program, META Services, Inc. 14.235 C-86-98-031-1 194,016
HOME Investment Partnerships Program 14.239 4,536,019
Public and Indian Housing 14.850 1,547,827
Public and Indian Housing Drug Elimination Program 14.854 218,516
Resident Opportunity and Supportive Services 14.870 183,298
Section 8 Housing Choice Vouchers 14.871 8,622,922
Public Housing Capital Fund 14.872 1,856,646
Lead-Based Paint Hazard Control in Privately-Owned Housing, City of
Phoenix 14.900 92269, 81732 68,030
Total U.S. Department of Housing and Urban Development 20,565,413
U.S. Department of the Interior
Payments in Lieu of Taxes 15.226 3,004,417
Reclamation Projects 15.9-07-30-L0298 2,374,138
Taylor Grazing Act 15.unknown 11,933
Total U.S. Department of the Interior 5,390,488
U.S. Department of Justice
State Domestic Preparedness Equipment Support Program 16.007 24,986
Juvenile Accountability Incentive Block Grants, Office
of the Governor 16.523 99-JAIBG-07 1,817,530
Juvenile Justice and Delinquency Prevention—Allocation to States,
Office of the Governor 16.540 A9-0004-010, A0-007-003 2,175
Title V—Delinquency Prevention Program 16.548 99,526
Part E—State Challenge Activities, Office of the Governor 16.549 JC-GRA-01-3273-00 24,756
(Continued)
See accompanying notes to schedule.
6
Maricopa County
Schedule of Expenditures of Federal Awards
Year Ended June 30, 2002
(Continued)
CFDA/
Identifying
Federal Grantor / Program Title / Number Pass-Through
Pass-Through Grantor (Note 2) Grantor's Number Expenditures
U.S. Department of Justice (continued)
National Criminal History Improvement Program (NCHIP), Arizona
Criminal Justice Commission 16.554 NCH-01-089 $ 54,050
Crime Victim Assistance, Arizona Department of Public Safety 16.575 2001-939, 2000-902, 98-923,
2001-VA-GX-0004 181,730
Crime Victim Compensation, Arizona Criminal Justice Commission 16.576 None 237,410
Byrne Formula Grant Program, Arizona Criminal Justice Commission 16.579 AC-020-02, AC-020-01,
PC-020-02, PC-020-01 1,306,576
Edward Byrne Memorial State and Local Law Enforcement Assistance
Discretionary Grants Program 16.580 584,411
Drug Court Discretionary Grant Program 16.585 169,567
Violence Against Women Formula Grants, Office of the Governor 16.588 A0-0025-010, AD010270-005 92,481
Local Law Enforcement Block Grants Program 16.592 574,003
Residential Substance Abuse Treatment for State Prisoners,
Arizona Criminal Justice Commission 16.593 SAT-02-108 301,375
State Criminal Alien Assistance Program 16.606 8,700,138
Bulletproof Vest Partnership Program 16.607 38,374
Community Prosecution and Project Safe Neighborhoods 16.609 22,688
Public Safety Partnership and Community Policing Grants 16.710 545,408
Enforcing Underage Drinking Laws Program, Governor's Office of
Highway Safety 16.727 2001-OJJDP-002, 2001-OJJDP-015 67,869
Federal Equitable Sharing Program 16.unknown 29,282
Total U.S. Department of Justice 14,874,335
U.S. Department of Labor
Welfare-to-Work Grants to States and Localities, Arizona Department
of Economic Security 17.253 E5709062 42,200
Welfare-to-Work Grants to States and Localities, National
Association Private Industry Council 17.253 None 2,433
WIA Cluster
WIA Adult Program, Arizona Department of Economic Security 17.258 E5701001, E5702007 1,705,375
WIA Youth Activities, Arizona Department of Economic Security 17.259 E5701001, E5702007 2,944,453
WIA Dislocated Workers, Arizona Department of Economic Security 17.260 E5701001, E5702007 1,282,896
Employment and Training Administration Pilots, Demonstrations, and
Research Projects 17.261 24,300
Total U.S. Department of Labor 6,001,657
U.S. Department of Transportation
Highway Planning and Construction, Arizona Department of
Transportation 20.205 JPA 97-09, JPA 99-171,
JPA 98-131 869,869
Highway Planning and Construction, Maricopa Association of
Governments 20.205 MAG#0098 876,794
Federal Transit—Formula Grants, City of Phoenix 20.507 AZ-90-X045, AZ-90-X049, AZ-90-X050 401,718
Job Access—Reverse Commute, City of Phoenix 20.516 AZ-37-X001 715,658
State and Community Highway Safety, Governor's Office of Highway
Safety 20.600 2000-AL-027, 200-410-010 40,402
Total U.S. Department of Transportation 2,904,441
(Continued)
See accompanying notes to schedule.
7
Maricopa County
Schedule of Expenditures of Federal Awards
Year Ended June 30, 2002
(Continued)
CFDA/
Identifying
Federal Grantor / Program Title / Number Pass-Through
Pass-Through Grantor (Note 2) Grantor's Number Expenditures
U.S. Environmental Protection Agency
Air Pollution Control Program Support 66.001 $ 950,984
U.S. Department of Energy
Weatherization Assistance for Low-Income Persons, Arizona
Department of Commerce 81.042 193-00 299,191
U.S. Federal Emergency Management Agency
Emergency Food and Shelter National Board Program, United Way 83.523 19025600 76,540
Emergency Management Performance Grants, Arizona Department of
Emergency and Military Affairs 83.552 None 250,961
Total U.S. Federal Emergency Management Agency 327,501
U.S. Department of Education
Adult Education—State Grant Program, Arizona Department of
Education 84.002 00-FAE-ABE-0706940-2A,
01-FAE-INF-170694-02A,
01-SAE-ABE-170694-01A 117,500
Title I Grants to Local Educational Agencies, Arizona Department of
Education 84.010 02FASDEL-260704-13A 88,494
Special Education—Grants to States, Arizona Department of
Education 84.027 00FESCBG-070692-01A,
00FESEJF-070692-02A,
01FESPTA-170692-01A 63,707
Even Start—State Educational Agencies, Arizona Department of
Education 84.213 01FAEEVS170694-03C,
F6-0001-02 145,135
Total U.S. Department of Education 414,836
U.S. Department of Health and Human Services
Special Programs for the Aging—Title III, Part B—Grants for
Supportive Services and Senior Centers, Area Agency on Aging 93.044 20027-MHS 286,622
Project Grants and Cooperative Agreements for Tuberculosis
Control Programs, Arizona Department of Health Services 93.116 30-4023 187,878
Health Center Grants for Homeless Populations 93.151 1,762,790
Coordinated Services and Access to Research for Women,
Infants, Children, and Youth 93.153 420,318
Hansen's Disease National Ambulatory Care Program 93.215 42,153
Family Planning—Services, Arizona Family Planning Council 93.217 761111 312,634
Demonstration Cooperative Agreements for Development and
Implementation of Criminal Justice Treatment Networks,
Arizona Department of Health Services 93.229 4UD8TI11210-05-2,
5UD8TI11210-04,
6UD8TI11210-04 291,864
Consolidated Knowledge Development and Application (KD&A)
Program 93.230 430,161
Innovative Food Safety Projects 93.245 4,345
Immunization Grants, Arizona Department of Health Services 93.268 152043 3,846,930
Promoting Safe and Stable Families, Child and Family Resources, Inc. 93.556 C-86-01-015-1, C8698030102,
C8698052102, C8698052103 55,129
Temporary Assistance for Needy Families, Arizona Department of
Economic Security 93.558 E5900018, E5900043, E6301006 1,111,111
(Continued)
See accompanying notes to schedule.
8
Maricopa County
Schedule of Expenditures of Federal Awards
Year Ended June 30, 2002
(Continued)
CFDA/
Identifying
Federal Grantor / Program Title / Number Pass-Through
Pass-Through Grantor (Note 2) Grantor's Number Expenditures
U.S. Department of Health and Human Services (continued)
Child Support Enforcement, Arizona Department of Economic
Security 93.563 E7207025, E7208025,
E7202313, E7202213 $ 1,315,136
Low-Income Home Energy Assistance, Arizona Department of
Economic Security 93.568 E6301006 1,164,952
Community Services Block Grant, Arizona Department of Economic
Security 93.569 E6307001, E6301006 729,466
Community Services Block Grant—Discretionary Awards 93.570 20,351
Refugee and Entrant Assistance—Discretionary Grants, Arizona
Department of Economic Security 93.576 None 130,805
Refugee and Entrant Assistance—Targeted Assistance, Arizona
Department of Economic Security 93.584 E6308022 143,159
Head Start 93.600 16,819,009
Runaway and Homeless Youth, Arizona Department of Economic
Security 93.623 E4371585 1,577
Children's Justice Grants to States, Office of the Governor 93.643 CJAG 99-55, CJAG 2000-75 48,517
Social Services Block Grant, Arizona Department of Economic
Security 93.667 E4311433, E6301006 1,377,891
HIV Emergency Relief Project Grants 93.914 6,129,351
HIV Care Formula Grants, Arizona Department of Health Services 93.917 152065 49,862
Grants to Provide Outpatient Early Intervention Services with
Respect to HIV Disease 93.918 777,003
Cooperative Agreements for State-Based Comprehensive Breast
and Cervical Cancer Early Detection Programs, Arizona Department
of Health Services 93.919 653017 275,517
HIV Prevention Activities—Health Department Based, Arizona
Department of Health Services 93.940 152031, 152033, 152022,
152004, 152008 534,592
Human Immunodeficiency Virus (HIV)/Acquired Immunodeficiency
Virus Syndrome (AIDS) Surveillance, Arizona Department of Health
Services 93.944 152069 128,412
Preventive Health Services—Sexually Transmitted Diseases
Control Grants, Arizona Department of Health Services 93.977 052010, 052011, 052012, 252025 433,465
Preventive Health and Health Services Block Grant, Arizona
Department of Health Services 93.991 95-2018 142,449
Maternal and Child Health Services Block Grant to the States,
Arizona Department of Health Services 93.994 761006, 961111, 16-1026,
152069, 952004, 961083 999,802
Total U.S. Department of Health and Human Services 39,973,251
Social Security Administration
Social Security—Disability Insurance, Arizona Department of
Economic Security 96.001 E5342528 7,375
Total Expenditures of Federal Awards $99,277,928
See accompanying notes to schedule.
9
Maricopa County
Notes to Schedule of Expenditures of Federal Awards
Year Ended June 30, 2002
10
Note 1 - Basis of Accounting
The accompanying schedule of expenditures of federal awards includes the federal grant
activity of Maricopa County and is presented on the modified accrual basis of accounting,
except for Schools and Roads—Grants to States (10.665), Payments in Lieu of Taxes (15.226),
Taylor Grazing Act (15.unknown), and State Criminal Alien Assistance Program (16.606). For
these programs, revenues received during the fiscal year are considered earned and are
reported as expenditures. The information in this schedule is presented in accordance with the
requirements of OMB Circular A-133, Audits of States, Local Governments, and Non-Profit
Organizations. Therefore, some amounts presented in this schedule may differ from amounts
presented in, or used in the preparation of, the financial statements.
The amount reported on the schedule for Food Donation (10.550) and $3,093,066 of the
Immunization Grants (93.268) are the value of noncash assistance expended for each of the
federal programs.
Note 2 - Catalog of Federal Domestic Assistance (CFDA) Numbers
The program titles and CFDA numbers were obtained from the federal or pass-through grantor
or the 2002 Catalog of Federal Domestic Assistance. When no CFDA number had been
assigned to a program, the federal contract number was used.
Note 3 - Subrecipients
From the federal expenditures presented in the schedule, the County awarded the following to
subrecipients:
Program Title CFDA Number Amount
Community Development Block Grants/
Entitlement Grants 14.218 $ 2,456,342
Emergency Shelter Grants Program 14.231 81,333
HOME Investment Partnerships Program 14.239 4,310,902
Byrne Formula Grant Program 16.579 81,867
Edward Byrne Memorial State and Local Law
Enforcement Assistance Discretionary Grants
Program 16.580 343,810
WIA Youth Activities 17.259 1,817,564
Highway Planning and Construction 20.205 558,289
Weatherization Assistance for Low-Income
Persons 81.042 286,118
(Continued)
Maricopa County
Notes to Schedule of Expenditures of Federal Awards
Year Ended June 30, 2002
(Continued)
Note 3 - Subrecipients (Concluded)
11
Program Title CFDA Number Amount
Special Programs for the Aging—Title III, Part B—
Grants for Supportive Services and Senior
Centers 93.044 $ 161,234
Coordinated Services and Access to Research
for Women, Infants, Children, and Youth 93.153 355,960
Consolidated Knowledge Development and
Application (KD&A) Program 93.230 241,754
Temporary Assistance for Needy Families 93.558 516,853
Community Services Block Grant 93.569 274,809
Community Services Block Grant—Discretionary
Awards 93.570 10,400
Refugee and Entrant Assistance—Targeted
Assistance 93.584 70,883
Head Start 93.600 5,982,191
Social Services Block Grant 93.667 180,170
HIV Emergency Relief Project Grants 93.914 3,322,877
Cooperative Agreements for State-Based
Comprehensive Breast and Cervical Cancer
Early Detection Programs 93.919 180,264
Maternal and Child Health Services Block Grant
to the States 93.994 8,264
Total Passed Through to Subrecipients $21,241,884
Maricopa County
Schedule of Findings and Questioned Costs
Year Ended June 30, 2002
12
Summary of Auditors’ Results
Financial Statements
Type of auditors’ report issued: Unqualified
Yes No
Material weaknesses identified in internal control over financial reporting? X
Reportable conditions identified not considered to be material weaknesses? X
Noncompliance material to the financial statements noted? X
Federal Awards
Material weaknesses identified in internal control over major programs? X
Reportable conditions identified not considered to be material weaknesses? X
Type of auditors’ report issued on compliance for major programs: Qualified
Any audit findings disclosed that are required to be reported in accordance with
Circular A-133 (section .510[a])? X
Identification of major programs:
CFDA Number Name of Federal Program or Cluster
14.218 Community Development Block Grants/Entitlement Grants
14.239 HOME Investment Partnerships Program
14.850 Public and Indian Housing
14.871 Section 8 Housing Choice Vouchers
14.872 Public Housing Capital Fund
16.606 State Criminal Alien Assistance Program
20.507 Federal Transit—Formula Grants
93.230 Consolidated Knowledge Development and Application (KD&A) Program
93.268 Immunization Grants
93.940 HIV Prevention Activities—Health Department Based
93.977 Preventive Health Services—Sexually Transmitted Diseases Control Grants
Dollar threshold used to distinguish between Type A and Type B programs: $2,978,338
Auditee qualified as low-risk auditee? X
Other Matters
Auditee's summary schedule of prior audit findings required to be reported in
accordance with Circular A-133 (section .315[b])? X
Maricopa County
Schedule of Findings and Questioned Costs
Year Ended June 30, 2002
13
Federal Award Findings and Questioned Costs
02-101
CFDA No.: 16.606 State Criminal Alien Assistance Program
U.S. Department of Justice
Award Year: July 1, 1999 through June 30, 2000
July 1, 2000 through June 30, 2001
Award Number: 2001-F0910-AZ-AP and 2002-F0291-AZ-AP
Eligibility
Questioned Cost—Unknown
The State Criminal Alien Assistance Program (SCAAP) required the County to submit an online application
to the U.S. Department of Justice, Bureau of Justice Assistance in order to receive SCAAP grant monies.
Maricopa County’s Office of Management and Budget (OMB) completed these applications in fiscal year
2002 for the reporting periods of July 1, 1999 through June 30, 2000 (SCAAP 2001), and July 1, 2000
through June 30, 2001 (SCAAP 2002), using information provided by the Sheriff’s Office. Auditors noted
that management in the Sheriff’s Office did not properly review some of the information provided to OMB
to determine if it was accurate and complete. However, OMB did review the information for reasonability
and consistency with prior year amounts before completing the application. In addition, the Sheriff’s Office
failed to retain some of the supporting documentation used to complete these applications. As a result,
the Sheriff’s Office recreated the necessary detailed documentation to support the amounts submitted on
the applications. We noted differences in several amounts reported, and determined that the total number
of correctional officer positions reported as employed by the Sheriff’s Office was understated by 248 and
164 for the 2001 and 2002 SCAAP applications, respectively. All other differences were determined to be
insignificant. Additionally, the total salary costs reported for correctional officers employed during the
reporting periods were overstated due to the inclusion of employee benefits and other payroll-related
costs included in the calculations that are not allowable in the program guidelines. We determined that the
County’s calculated costs were overstated by approximately $5,659,439 and $5,788,408 due to the
inclusion of these costs on the 2001 and 2002 SCAAP applications, respectively. In addition to the
reported understatement of correctional officer positions, the County could have claimed additional
correctional officer salary costs of approximately $2,546,145, and $3,348,829 on the 2001 and 2002
SCAAP applications, respectively. Since the County received federal funding based on a percentage of
eligible inmate data, correctional officer salary costs, and facility data for all entities requesting federal
assistance, we were unable to calculate the amount of questioned costs or determine if these errors were
significant to program monies received.
To comply with program requirements, the County should establish the necessary controls to ensure that
the Sheriff’s Office properly reviews all required information on the SCAAP application for completeness
and accuracy prior to its submission to OMB. In addition, to ensure compliance with 28 Code of Federal
Regulations §66.42, all supporting documentation used to complete the application must be retained.
Furthermore, OMB should verify that all data was reviewed for accuracy prior to completing the SCAAP
application.
Maricopa County
Schedule of Findings and Questioned Costs
Year Ended June 30, 2002
14
02-102
CFDA No.: 93.151 Health Center Grants for Homeless Populations
U.S. Department of Health and Human Services
Award Year: November 1, 2000 through October 31, 2001
Award Number: 5H66CS00459-14
Period of Availability
Questioned Cost—$13,226
The Department of Public Health did not establish specific controls to ensure that all program costs
charged to the award period resulted from obligations incurred during such period. The lack of these
controls resulted in $13,226 of expenditures, incurred from November 2001 through January 2002, that
were charged to an expired award period. To help ensure compliance with the grant contract, Public
Health should establish and implement control policies and procedures that will ensure that all obligations
charged to an award were incurred during the period of availability and are liquidated no later than 90
days after the award period.
02-103
CFDA No.: 93.230 Consolidated Knowledge Development and Application (KD&A) Program
U.S. Department of Health and Human Services
Award Year: October 1, 2000 through September 30, 2001
October 1, 2001 through September 30, 2002
Award Number: 1H79TI12401-01 and 1H79TI12401-02
Subrecipient Monitoring
Questioned Cost—Unknown
During fiscal year 2001-2002, the Adult Probation Department passed through $241,754 to a subrecipient,
but did not have a written contract with the subrecipient to advise the subrecipient of the imposed
requirements. In addition, the Department did not have specific written policies and procedures for
subrecipient monitoring, including policies and procedures requiring formal site visits, review of
subrecipient detailed expenditure data, and an evaluation of subrecipient audit requirements. As a result,
the Department did not comply with certain subrecipient monitoring policies and procedures prescribed
by OMB Circular A-133, Subpart D, §.400(d). Specifically, the Department did not perform and document
specific site visits and did not evaluate whether subrecipients expended greater than $300,000 in federal
awards to ensure they received an A-133 audit. As a result, the Department could not ensure that the
subrecipient is complying with all applicable program requirements.
To ensure proper monitoring of subrecipients, the Department should follow the policies and procedures
prescribed by OMB Circular A-133, Subpart D, §.400(d) and establish specific subrecipient monitoring
policies and procedures, which include:
· A signed contract that details the specific award and grant program requirements;
· Monitoring subrecipients’ activities as necessary to ensure compliance with program requirements.
Such procedures should consist of specific site visits that include review of detailed expenditure
supporting documentation;
· Evaluating whether each subrecipient meets the thresholds requiring an A-133 audit.
Maricopa County
Schedule of Findings and Questioned Costs
Year Ended June 30, 2002
15
This finding is considered to be a material internal control weakness and material noncompliance with the
program’s subrecipient monitoring requirement. It was not practical to extend our auditing procedures
sufficiently to determine questioned costs, if any, that may have resulted from this finding.
Maricopa County
Department of Finance
Tom Manos
Chief Financial Officer
301 West Jefferson Street
Suite 950
Phoenix, AZ 85003-2278
Phone: 602.506-3561
Fax: 602.506-4451
www.maricopa.gov
May 15, 2003
Debbie Davenport
Auditor General
2910 North 44th Street, Suite 410
Phoenix, AZ 85018
Dear Ms. Davenport:
The accompanying corrective action plan has been prepared as required by
U.S. Office of Management and Budget Circular A-133. Specifically, we are
providing you with the names of the contact persons responsible for
corrective action, the corrective action planned, and the anticipated
completion date for each audit finding included in the current year’s schedule
of findings and questioned costs.
Sincerely,
Shelby Scharbach
Deputy Finance Director
16
Maricopa County
Corrective Action Plan
Year Ended June 30, 2002
Federal Award Findings and Questioned Costs
02-101
CFDA No.: 16.606 State Criminal Alien Assistance Program
Contact Person: Loretta Barkell, Sheriff’s Chief Financial Officer, 602-256-1300 ext.
5436
Anticipated Completion Date: June 30, 2003
We concur that internal controls for proper review could have been stronger during the
audit period covered.
Effective with the 2003 application, the Maricopa County Sheriff’s Office will assume
responsibility for gathering the correct data for the application submission and for
following records retention requirements according to SCAAP Guidelines. Sheriff’s
Office Management will verify that all the data was reviewed for accuracy prior to
completing the SCAAP application.
02-102
CFDA No.: 93.151 Health Center Grants for Homeless Populations
Contact Person: Scot Pitcairn, Finance & Budget, Department of Public Health, 602-
506-6963
Anticipated Completion Date: October 31, 2003
For the award period ending October 31, 2002, the Public Health Department
established and implemented policies and procedures to ensure that all obligations
charged to an award were incurred during the period of availability and are liquidated no
later than 90 days after the award period. The finding is a result of issues defined
during March 2002. The Department will review the grant activity for fiscal year 2002
and make all the necessary corrections.
02-103
CFDA No.: 93.230 Consolidated Knowledge Development and Application (KD&A)
Program
Contact Person: Jeff Trollinger, Program Manager, Adult Probation Department, (602)
506-6456
Anticipated Completion Date: September 1, 2003
This issue occurred primarily for two reasons. The original contract with this agency
had expired and the classification of the agency as a vendor by Adult Probation was
found to be incorrect during this audit.
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Maricopa County
Corrective Action Plan
Year Ended June 30, 2002
The Adult Probation Department will take the following actions to ensure compliance
with the audit finding. A new contract that details the specific award and grant program
compliance requirements will be developed for the subrecipient. Any new grants with
subrecipients will have a similar contract in place. Policies and procedures for
subrecipient monitoring including formal site visits, reviews of subrecipient detailed
expenditure data, and an evaluation of subrecipient audit requirements will be written.
A site visit will be immediately scheduled with this subrecipient to review expenditure
data and to determine if they meet the thresholds requiring an Office of Management
and Budget Circular A-133 audit.
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Maricopa County
Department of Finance
Tom Manos
Chief Financial Officer
301 West Jefferson Street
Suite 950
Phoenix, AZ 85003-2278
Phone: 602.506-3561
Fax: 602.506-4451
www.maricopa.gov
May 15, 2003
Debbie Davenport
Auditor General
2910 North 44th Street, Suite 410
Phoenix, AZ 85018
Dear Ms. Davenport:
The accompanying summary schedule of prior audit findings has been
prepared as required by U.S. Office of Management and Budget Circular A-
133. Specifically, we are reporting the status of audit findings included in the
prior audit’s schedule of findings and questioned costs related to federal
awards. This schedule also includes audit findings reported in the prior
audit’s summary schedule of prior audit findings that have not been
corrected.
Sincerely,
Shelby Scharbach
Deputy Finance Director
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Maricopa County
Summary Schedule of Prior Audit Findings
Year Ended June 30, 2002
Status of Federal Award Findings and Questioned Costs
CFDA No. 16.579 – Byrne Formula Grant Program
Finding No. 00-102
Status: Fully corrected.
CFDA No. 16.579 – Byrne Formula Grant Program
Finding No. 00-103
Status: Fully corrected.
CFDA No. 20.205 – Highway Planning and Construction
Finding No. 00-105
Status: Partially corrected.
OMB Circular A-133 Subpart b, 210(e) requires a pass through entity to describe all
applicable compliance requirements and the subrecipient's compliance responsibilities
in its contracts with subrecipients. During fiscal year 01-02 the Department of
Transportation only included Suspension and Debarment and Davis-Bacon Act
compliance requirements in the contracts with subrecipients. The Department of
Transportation will include all applicable compliance requirements in fiscal year 02-03
contracts with subrecipients. Contact person is Helen Ortiz-Silva, Contract Specialist
(602) 506-4108.
CFDA No. 93.153 – Coordinated HIV Services and Access to Research for Children,
Youth, Women, and Families
Finding No. 00-106
Status: Fully corrected.
CFDA No.: 93.151 – Health Center Grants for Homeless Populations
Finding No. 01-101
Status: Partially corrected.
The Public Health Department implemented controls to ensure that all program costs
charged to the award period resulted from obligations incurred during the period. The
grantor was contacted and advised of the issue. Public Health will send a letter to the
grantor to confirm the verbal agreement made between Public Health and the grantor
regarding the questioned amount. Contact person is Scot Pitcairn, Finance Manager
(602) 506-6963.
CFDA No.: 93.151 – Health Center Grants for Homeless Populations
Finding No. 01-102
Status: Fully corrected.
CFDA No. 93.153 – Coordinated HIV Services and Access to Research for Children,
Youth, Women, and Families
Finding No. 01-103
Status: Fully corrected.
20