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Accept the Solano County Single Audit Report for the fiscal year ended June 30, 2023
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Published Notice Required? Yes ____ No _X _
Public Hearing Required? Yes ____ No _X _
DEPARTMENTAL RECOMMENDATION:
The Auditor-Controller’s Office (ACO) recommends that the Board of Supervisors accept the Solano County Single Audit Report for the fiscal year ended June 30, 2023 (FY2022/23).
SUMMARY:
In accordance with the Office of Management and Budget (OMB) Uniform Guidance, the County is required to have a Single Audit of the County’s compliance with Federal grant agreements. The Auditor-Controller’s Office presents to the Board of Supervisors Solano County’s Single Audit Report for FY2022/23.
Eide Bailly, L.L.P., CPA, conducted the Single Audit for the FY2022/23 pursuant to the contract terms approved by the Board of Supervisors on April 28, 2020.
FINANCIAL IMPACT:
None.
DISCUSSION:
Single Audit Report
The County incurred total expenditures of Federal Awards of $154,472,189 (which includes $24,309,059 to subrecipients). As a result, Solano County is required to have a Single Audit to determine Solano County’s compliance with Federal grant agreements.
Solano County contracts with Eide Bailly, LLP, CPA, to perform the Single Audit. As a result of the Single Audit, Eide Bailly issued the Single Audit Report which is comprised of two reports:
1) Independent Auditors’ Report on Internal Control over Financial Reporting and on Compliance and Other Matters based on an Audit of Financial Statements performed in accordance with Government Auditing Standards. The County received an unmodified opinion (clean opinion) on its financial statements previously presented to the Board of Supervisors on March 12, 2024. However, the auditors identified a material weakness in internal control over financial reporting due to audit adjustments for the correction of revenues and expenditures.
Additionally, the auditor’s report on compliance disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards.
2) Independent Auditors’ Report on Compliance for Each Major Federal program; Report on Internal Control over Compliance; Report on Schedule of Expenditures of Federal Awards (SEFA) required by the Uniform Guidance; and Supplemental Schedule of Office of California State Department of Aging Grants.
The County received an unmodified opinion (clean opinion) for all major programs except for the Section 8 Housing Choice Vouchers Program, Highway Planning and Construction, and the Medicaid Cluster Programs. These three programs received a qualified opinion:
a. Section 8 Housing Choice Vouchers - The County needs to strengthen its policies and procedures over subrecipient monitoring to ensure that a risk assessment is completed prior to the start of the annual award and reviewed timely and must document its review and results. The County did not report the grant as required under the Federal Funding Accountability and Transparency Act of 2006 (FFATA) which is a repeat finding from the FY2021/22 Single Audit.
Resource Management staff will update the risk assessment annually and will retain documentation to support monitoring activities. Also, the County spent many months contacting multiple agencies trying to report through the FSRS system on the multiple Housing Voucher awards, with no success. The County is unable to complete FFATA reporting for reasons outside of the County’s control.
b. Highway Planning and Construction - The County did not have documented policies and procedures over subrecipient monitoring in order to determine the difference between a contractor or a subrecipient arrangement.
Resource Management will include Public Works in its policies and procedures in its determination of whether a vendor is a contractor or subrecipient, a practice already followed for the other divisions within the departments.
c. Medicaid Cluster - The County needs to strengthen its policies and procedures with regards to eligibility redeterminations, required documentation, and maintenance of participant file and ensure that such policies and procedures are formally documented.
Health and Social Services will perform annual eligibility determinations and redeterminations including obtaining documentation and verifications evaluations. The department has pending County budget requests to address staff issues and also participates in State level discussions related to advocacy and IHSS administrative funding.
Management has responded to the findings and submitted a Corrective Action Plan. A copy of the Corrective Action Plan is included as Attachment B. The Plan reflects an updated response to finding 2023-008 following submission to the Single Audit Clearinghouse.
The report identified material weaknesses as described in the schedule of findings. None of the findings in the programs reviewed resulted in any disallowed costs to the grantor.
ALTERNATIVES:
The Board could elect not to accept the audit report as presented; however, this alternative is not consistent with sound public policy and is therefore not recommended.
OTHER AGENCY INVOLVEMENT:
The ACO serves as the liaison between the external auditors, Eide Bailly, L.L.P. and the County departments. The ACO coordinated test work and meetings with County departments, facilitated access to the financial system (Finance Enterprise) reports and supporting documentation, etc.
The ACO would like to acknowledge our staff, Katie Golemis and Matthew Fong, and thank the County departments for their cooperation and support during the Single Audit.
CAO RECOMMENDATION:
APPROVE DEPARTMENTAL RECOMMENDATION