Rachlin, Cohen & Holtz # 1 - Laserfiche WebLink

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CITY OF A BC, FLORIDA SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) R eCOfllflle IIdatioll We believe that a review and evaluation of transactions recorded at year end should be performed to ensure the validity of amounts recorded, as well as reduce audit time. We recommend that a detailed general ledger account analysis be performed on a monthly basis and reviewed by supervisory Finance Depart ment staff to ensure accurate recordi ng of transact ions. Procedures should be implemented to ensure that City departments submit information on a timely basis to the Finance Depar1ment to ensure proper recording of transactions. We also suggest that the Finance Depar1ment perform an analytical review of account balances with the prior year balances prior to closing the books and records to facilitate determining if adjustments are required. The Finance Department should evaluate the current process utilized to prepare the City's financial statements. The process could be simplified by preparing a conversion worksheet and formal adjustments to determine the amounts to be reported as governmental activities. The City should consider developing formal year end closing procedures. These procedures should include timetables outlining appropriate due dates and instructions for schedules that should be prepared. The closing procedures should be documented in a formal checklist that indicates the individual responsible for the task, when it is due to be completed and when it is accomplished. The procedures should also assign a supervisory Finance Depar1ment individual to review the schedules. 05-()2 Grallt Accoulltillg alld Reimbursemellts Criteria Grant accounting provides that since expenditures are the prime factor for determining eligibility. revenue should be recognized when the expenditure is incurred. If revenues are received in excess of grant expenditures, those revenues should be deferred. In order to maximize cash tlow, and enhance investment income, claim forms for reimbursement should be filed on a timely basis. The various City departments responsible for filing for grant reimbursements should submit claim forms to the Finance Depa[1ment on a timely basis to ensure that the receivables are properly recorded on the books and records. Co 11 d i t i 0 11 . We noted that, in numerous instances, claim forms for reimbursements of costs incurred were not filed on a timely basis. We noted that for certain projects, reimbursements for costs incurred in the 2004 and 2005 fiscal years, were not requested until 2006. In most instances, the Finance Department was not provided with information from the depar1ments requesting the reimbursements until March 2006, at which time journal entries were proposed to record the related receivables. · We noted that receivables were not recorded when eligible grant expenditures were incurred in excess of funding received by the City. Receivables for FEMA, the Urbanized Area Security Initiatives (UASI), and Urban Search and Rescue (USAR) grants were not calculated and recorded on the hooks and records. We also noted that for grants where the funding received exceeded expenditures incurred, deferred revenues were not recorded. · We noted payments received by the City for the UASI grants, as well as payments made to Miami Dade County. a subrecipient of the granl, were not properly rellected on the books and records. We noted that these transactions were recorded in a balance sheet account. rather than heing rellected as reV~llue and an exp~llcliture. -10-