Coconino County Arizona single audit reporting package

              COCONINO COUNTY, ARIZONA
Single Audit Reporting Package
June 30, 2001
Table of Contents Page
Report on Audit of General Purpose Financial Statements
Issued separately
Reports on Compliance and Internal Control
Report on Compliance and on Internal Control over Financial Reporting
Based on an Audit of General Purpose 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 .......................................................................................5
Notes to Schedule of Expenditures of Federal Awards ....................................................................7
Schedule of Findings and Questioned Costs
Summary of Auditors’ Results.....................................................................................................8
Federal Award Findings and Questioned Costs..............................................................................9
County Responses
Corrective Action Plan.................................................................................................................... 10
Summary Schedule of Prior Audit Findings ....................................................................................... 12
1
Independent Auditors’ Report on Compliance and on Internal Control over Financial
Reporting Based on an Audit of General Purpose Financial Statements
Performed in Accordance with Government Auditing Standards
The Auditor General of the State of Arizona
The Board of Supervisors of Coconino County, Arizona
We have audited the general purpose financial statements of Coconino County as of and for the
year ended June 30, 2001, and have issued our report thereon dated January 18, 2002. 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 general purpose 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 general purpose 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 disclosed no
instances of noncomplia nce that are required to be reported under Government Auditing
Standards. However, we noted certain immaterial instances of noncompliance, which we have
reported to the management of Coconino County in a separate letter dated January 18, 2002.
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 general purpose financial statements and not to provide assurance on internal control over
financial reporting. However, we noted a certain matter involving internal control over financial
reporting and its operation that we consider to be a reportable condition. Reportable conditions
involve matters coming to our attention relating to significant deficiencies in the design or
operation of internal control over financial reporting that, in our judgment, could adversely affect
the County’s ability to record, process, summarize, and report financial data consistent with the
assertions of management in the general purpose financial statements. The reportable condition is
described in the accompanying schedule of findings and questioned costs as item 01-01.
2
Page Two
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 general purpose 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. Our consideration of internal control over financial
reporting 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, we believe the reportable condition described
above is not a material weakness. We also noted other matters involving internal control over
financial reporting that we have reported to the County’s management in a separate letter dated
January 18, 2002.
This report is intended solely for the information and use of the members of the Arizona State
Legislature, the Auditor General of the State of Arizona, 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.
January 18, 2002
3
Independent Auditors’ Report on Compliance with Requirements
Applicable to Each Major Program and on Internal Control ove r Compliance in
Accordance with OMB Circular A-133
The Auditor General of the State of Arizona
The Board of Supervisors of Coconino County, Arizona
Compliance
We have audited the compliance of Coconino 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,
2001. The County’s major federal programs are identified in the summary of the 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 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.
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 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
provides a reasonable basis for our opinion. Our audit does not provide a legal determination on
the County’s compliance with those requirements.
In our opinion, Coconino 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, 2001. However, the results of our auditing procedures disclosed one instance of
noncompliance with those requirements that is required to be reported in accordance with OMB
Circular A-133 which is described in the accompanying schedule of findings and questioned costs
as item 01-101.
4
Page Two
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 a certain matter involving internal control over compliance and its operation that we
considered to be a reportable condition. 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. The reportable condition is described in the accompanying schedule of findings and
questioned costs as item 01-101.
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,
we believe the reportable condition described above is not a material weakness.
Schedule of Expenditures of Federal Awards
We have audited the County’s general purpose financial statements as of and for the year ended
June 30, 2001, and have issued our report thereon dated January 18, 2002. Our audit was made
for the purpose of forming an opinion on the general purpose 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
general purpose financial statements. Such information has been subjected to the auditing
procedures applied in the audit of the general purpose financial statements and, in our opinion, is
fairly stated, in all material respects, in relation to the general purpose 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 Auditor General of the State of Arizona, 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 matter of public record and its
distribution is not limited.
January 18, 2002
COCONINO COUNTY
Schedule of Expenditures of Federal Awards
Year Ended June 30, 2001
CFDA Pass-Through
Federal Grantor/Pass-Through Number Grantor's
Grantor/Program Title (Note 2) Number Expenditures
U.S. Department of Agriculture
Passed through:
Arizona Department of Education
National School Lunch Program 10.555 KR00-0475 $ 7,870
Arizona Department of Health Services
Special Supplemental Food Program for
Women, Infants, and Children 10.557 761090 #4 427,207
Commodity Supplemental Food Program 10.565 76115 #4 9,121
Northern Arizona Council of Governments
Nutrition Program for the Elderly (Commodities) 10.570 86 66000441BA 127,021
Arizona State Treasurer
Schools and Roads - Grants to States 10.665 None 642,213
Total U.S. Department of Agriculture 1,213,432
U.S. Department of Housing and Urban Development
Passed through:
Arizona Department of Economic Security
Emergency Shelter Grants Program 14.231 E6301004 190,941
Arizona Department of Commerce
Community Development Block Grant 14.228 095-98 122,895
Total U.S. Department of Housing and Urban
Development 313,836
U.S. Department of the Interior
Payment in Lieu of Taxes 15.226 820,879
U.S. Department of Justice
Violence Against Women Formula Grants 16.588 106,183
Grants to Encourage Arrest Policies 16.590 285,466
Local Law Enforcement Block Grants Program 16.592 21,150
Public Safety Partnership and Community Policing Grants 16.710 123,766
Executive Office for Weed and Seed 16.595 124,075
Passed through:
Arizona Governor's Division for Children
Coordinated Community Response Team/Rural Domes 16.589 97-WR-VX-004 35,101
Arizona Criminal Justice Commission
Juvenile Accountability Incentive Block 16.523 JAIBG-03 42,227
National Criminal History Improvement Project 16.554 NCH-01-093 263,959
Byrne Formula Grant Program 16.579 CRI-00-019 76,674
Total U.S. Department of Justice 1,078,601
U.S. Department of Labor
Passed through the Arizona Department of Economic
Security
Senior Community Service Employment Program 17.235 E6201060 117,806
Workforce Investment Act 17.255 E5701006/E5702003 771,114
Total U.S. Department of Labor 888,920
(Continued)
See accompanying notes to schedule
5
COCONINO COUNTY
Schedule of Expenditures of Federal Awards
Year Ended June 30, 2001
CFDA Pass-Through
Federal Grantor/Pass-Through Number Grantor's
Grantor/Program Title (Note 2) Number Expenditures
U.S. Department of Transportation
Public Transportation for Urbanized Areas 20.507 $ 335,459
Interagency Hazardous Materials Transport 20.703 23,167
Total U.S. Department of Transportation 358,626
U.S. Federal Emergency Management Agency
Passed through the Arizona Department of
Emergency and Military Affairs
Emergency Management - State and Local Assistance 83.534 None 46,298
Federal Emergency Management Vouchers 83.503 None 21,525
Total U.S. Federal Emergency Management Agency 67,823
U.S. Department of Education
Passed through the Arizona Department of Health Services
Special Education - Grants for Infants and Families
with Disabilities 84.181 161004 43,624
U.S. Department of Health and Human Services
Passed through:
Northern Arizona Council of Governments
Respite Care 93.004 866000441ba 13,940
Special Programs for the Aging - Title III, Part B -
Grants for Supportive Services and Senior Centers 93.044 866000441ba 121,482
Arizona Department of Health Services
Immunization Grants 93.268 152037 32,363
HIV Care Formula Grants 93.917 652042 #6 293,285
Well Woman Health Check 93.919 852018 36,746
Title III HIV Planning grants 93.918 1 P06 HA 00283-01 29,507
HIV Prevention Activities - Health Department Based 93.940 852037, 852038 103,816
Preventative Health and Health Services Block Grant 93.991 952015 79,809
Maternal and Child Health Services Block Grant to
the States 93.994 761103, 761007
961122, 761141 180,144
Arizona Department of Economic Security
Temporary Assistance for Needy People 93.558 E6301035 E5900007 E6301004 204,681
Title IVD Child Support 93.563 None 4,690
Low-Income Home Energy Assistance 93.568 E6301035 / E6301004 79,834
Community Services Block Grant 93.569 E6301004
E6301004/E2309036/866000441BA 61,321
Social Services Block Grant 93.667 86 6000441BA 100,697
Total U.S. Department of Health and Human Services 1,342,315
U.S. Corporation for National and Community Service
Passed through Arizona National and Community Service
Division
Americorps 94.006 94-ASC-AZ-003 37,574
Total Expenditures of Federal Awards $ 6,165,630
See accompanying notes to schedule
6
7
COCONINO COUNTY
Notes to Schedule of Expenditures of Federal Awards
Year Ended June 30, 2001
Note 1 – Basis of Accounting
The accompanying schedule of expenditures of federal awards includes the federal
grant activity of Coconino County and is presented on the modified accrual basis of
accounting. 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.
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 2001 Catalog of Federal Domestic Assistance Update.
8
COCONINO COUNTY
Schedule of Findings and Questioned Costs
Year Ended June 30, 2001
Summary of Auditors’ Results
Financial Statements
Type of auditors’ report issued: Unqualified
YES NO
Material weakness identified in internal control over financial reporting? X
Reportable condition identified not considered to be material weakness? X
Noncompliance material to the financial statements noted? X
Federal Awards
Material weakness identified in internal control over major programs? X
Reportable condition identified not considered to be material weakness? X
Type of auditors’ report issued on compliance for major programs: Unqualified
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
10.557 Special Supplemental Nutrition Program for Women, Infants, and Children
10.665 Schools and Roads – Grants to States
15.226 Payment in Lieu of Taxes
17.255 Workforce Investment Act
20.507 Public Transportation for Urbanized Areas
93.994 Maternal and Child Health Services Block Grant to the States
Dollar threshold used to distinguish between Type A and Type B programs: $ 300,000
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
9
COCONINO COUNTY
Schedule of Findings and Questioned Costs
Year Ended June 30, 2001
Financial Statement Findings
01-01
The County did not reconcile amounts reported on the financial
statements to the official budget approved by the Board of Supervisors
Budgeted revenue and expenditure amounts that are entered into the County’s general
ledger system by the Budget Director’s staff do not agree with the official adopted budget
approved by the County Board of Supervisors. As a result, the finance department does
not have the information necessary to prepare budget and actual financial statements that
agree to the current board-approved budget. This condition impairs the usefulness of the
financial statements to their users and we consider this to be a reportable condition.
The County should implement measures that help ensure the balances entered into the
general ledger system agree with, or can be reconciled to, the budget that is approved by
the County Board of Supervisors.
Federal Award Findings and Questioned Costs
01-101
CFDA No.: 93.994 Maternal and Child Health Services Block Grant to the States
U.S. Department of Health and Human Services
Pass-through Entity: Arizona Department of Health Services
Award Year: July 1, 1999 through June 30, 2000
Award Numbers: 761103, 761007, 961122, 761141
Questioned Cost: N/A
The Coconino County Department of Health Services did not establish and maintain
written internal control policies and procedures that conform to the allowable costs/cost
principle and eligibility compliance requirements of the Maternal and Child Health
Services Block Grant to the States program. Our auditing procedures determined that the
County appeared to be in compliance with laws, regulations and the provisions of grant
agreements that had a direct and material effect on the program. Therefore, we consider
this to be a reportable condition, but not a material weakness, and not a material instance
of noncompliance.
In order to help ensure compliance with the provisions of OMB Circular A-133, Audits
of States, Local Governments, and Non-Profit Organizations, Subpart C, Section .300 (b),
the County should take steps to establish and maintain written internal control policies
and procedures that conform to the compliance requirements of the Maternal and Child
Health Services Block Grant to the States program.
10
September 5, 2002
Debbie Davenport
Auditor General
2910 N. 44th Street, Suite 410
Phoenix, AZ 85018
Dear Ms. Davenport:
The following 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,
Michael F. Townsend
Finance Director
11
COCONINO COUNTY
Corrective Action Plan
Year Ended June 30, 2001
Financial Statement Findings
01-01
The County did not reconcile amounts reported on the financial
statements to the official budget approved by the Board of Supervisors
Contact Person: Mike Townsend
Phone Number: (928)-779-6895
Anticipated completion date: Completed
The County Budget department has implemented procedures to reconcile the budget
entered into the County’s general ledger system for the fiscal year 2003 budget entered in
August 2002. This is to ensure the balances entered into the general ledger system agree
with, or can be reconciled to, the budget that is approved by the County Board of
Supervisors.
Federal Award Findings and Questioned Costs
01-101
CFDA NO.: 93.994 Maternal and Child Health Services Block Grant to the States
Contact Person: Laura Talavera
Phone Number: (928)-522-7950
Anticipated completion date: 12/31/2002
The Health Department’s Clinical Services Unit is currently in the process of developing
written internal control policies and procedures for all programs. For those programs,
which are grant funded, there will be grant or contract specific policies and procedures
which cover allowed costs/activities and eligibility.
12
September 5, 2002
Debbie Davenport
Auditor General
2910 N. 44th Street, Suite 410
Phoenix, AZ 85018
Dear Ms. Davenport:
The following 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,
Michael F. Townsend
Finance Director
13
COCONINO COUNTY
Summary Schedule of Prior Audit Findings
Year Ended June 30, 2001
Status of Federal Award Findings and Questioned Costs
96-102
CFDA No. 93.994 – Maternal and Child Health Service Block Grant to the States
U.S. Department of Health and Human Services, 1996
Arizona Department of Health Services
Finding: The Family Planning Services Program’s number of provided service units was
overstated on the Contractor’s Expenditure Reports for fiscal year 1995-96. Amounts
claimed for reimbursement are based on a fixed rate per unit of service provided, as
specified in the ADHS grant agreement. As a result, the amount claimed and reimbursed
was overstated by $1,170.
Status: Not corrected
Family planning staff are in the process of researching this questioned cost and will be
meeting with officials from ADHS to resolve this issue by December 31, 2002.
98-102
CFDA No. 93.994 – Maternal and Child Health Service Block Grant to the States
U.S. Department of Health and Human Services, 1997 and 1998
Arizona Department of Health Services
Finding: The Coconino County Department of Health Services did not maintain adequate
supporting documentation to comply with the Maternal Child Health Services Block
Grant to the States program for the Family Planning Services program requirements.
Status: Corrected
A client listing by month that organizes participant data to allow for eligibility testing has
been kept since January of 2001.
14
COCONINO COUNTY
Summary Schedule of Prior Audit Findings
Year Ended June 30, 2001
99-103
CFDA No. 16.590 – Grants to Encourage Arrest Policies
U.S. Department of Justice, 1998 and 1999
Finding: The Coconino County Attorney’s Office (the County) did not establish policies
and procedures to properly monitor the activities of Victim/Witness Services for
Coconino County, Inc. (VWS), the subrecipient of the Grants to Encourage Arrest
Policies program. Quarterly expenditure reports and program narratives were not
obtained in a timely manner for the subrecipient. As a result, the County was not able to
verify that federal funds drawn down by VWS were properly disbursed and federal
monies were expended within budget limitations. Also, under the subrecipient agreement
VWS was responsible for completing the County’s quarterly financial status reports.
However, the County failed to maintain a copy of these reports and we were unable to
verify if they were accurately completed. Furthermore, the County failed to determine if
VWS required a single audit.
We consider this to be a material instance of noncompliance and a material weakness.
Status: Not corrected
The Grants to Encourage Arrest Policies was discontinued in FY 2001. However, the
County plans to develop internal control policies and procedures to help ensure proper
monitoring of federal award program subrecipients.
00-101 and 98-101
CFDA No. 93.994 – Maternal and Child Health Service Block Grant to the States
U.S. Department of Health and Human Services, 1997, 1998,
and 2000
Arizona Department of Health Services
Finding: The Coconino County Department of Health Services did not establish and
maintain written internal control policies and procedures by June 30, 2002, applicable to
the Maternal and Child Health Services Block Grant to the States program.
Status: Not corrected
The Health Department’s Clinical Services Unit is currently in the process of developing
written internal control policies and procedures for all programs. For those programs,
which are grant funded, there will be grant or contract specific policies and procedures
which cover allowed costs/activities and eligibility.
15
COCONINO COUNTY
Summary Schedule of Prior Audit Findings
Year Ended June 30, 2001
00-102
CFDA No.: 93.994 Maternal and Child Health Services Block Grant to the States
U.S. Department of Health and Human Services
Pass-through Entity: Arizona Department of Health Services
Award Year: July 1, 1999 through June 30, 2000
Award Number: 761103
Questioned Cost: $84,370
The Coconino County Department of Health Services (the Department) did not maintain
adequate supporting documentation to comply with the Maternal and Child Health
Services Block Grant to the States program for the Family Planning Services program
requirements as evidenced by the following deficiencies.
• A complete population of the Family Planning Services program awards was not
available because the department did not maintain a listing of participants.
Therefore, we were unable to determine if federal monies were awarded only to
eligible participants.
• Supporting documentation for the Family Planning Services program monthly
Contractor Expenditure Reports was organized in a manner that precluded audit
testing. Therefore, we were unable to verify the information submitted on the
reports.
Status: Corrected
A listing of participants has been kept since January 2001 and all supporting
documentation has been organized and filed to facilitate testing.