FEDERAL AND STATE SINGLE AUDIT REPORTS Fiscal Year Ended September 30, 2004
TABLE OF CONTENTS FEDERAL AND STATE SINGLE AUDIT REPORTS Fiscal Year Ended September 30, 2004 Independent Auditor s Report on Compliance and Internal Control over Compliance Applicable to each Major Federal Program and Major State Project... 1 Schedule of Findings and Questioned Costs... 3 Schedule of Expenditures of Federal Awards and State Financial Assistance... 5 Notes to Schedule of Expenditures of Federal Awards and State Financial Assistance... 8
1870 Aloma Avenue, Suite 120 Winter Park, Florida 32789 TEL 407-599-7055 FAX 407-599-7054 INDEPENDENT AUDITOR S REPORT ON COMPLIANCE AND INTERNAL CONTROL OVER COMPLIANCE APPLICABLE TO EACH MAJOR FEDERAL PROGRAM AND MAJOR STATE PROJECT Honorable Mayor and City Council City of Orlando, Florida: Compliance We have audited the compliance of the City of Orlando, Florida (the City ) with the types of compliance requirements described in the U.S. Office of Management and Budget (OMB) Circular A-133 Compliance Supplement, and the requirements described in the Executive Office of the Governor s State Projects Compliance Supplement, that are applicable to each of its major federal programs and major state projects for the year ended September 30, 2004. The City s major federal programs and major state projects are identified in the summary of auditor s results section of the accompanying schedule of findings and questioned costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to its major federal programs and major state projects is the responsibility of the City s management. Our responsibility is to express an opinion on the City s compliance based on our audit. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations; and Chapter 10.550, Rules of the Auditor General. Those standards, OMB Circular A-133 and Chapter 10.550 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 or major state project occurred. An audit includes examining, on a test basis, evidence about the City 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 City s compliance with those requirements. In our opinion, the City complied, in all material respects, with the requirements referred to above that are applicable to each of its major federal programs and major state projects for the year ended September 30, 2004. Internal Control Over Compliance The management of the City is responsible for establishing and maintaining effective internal control over compliance with the requirements of laws, regulations, contracts, and grants applicable to federal programs and state projects. In planning and performing our audit, we considered the City s internal control over compliance with requirements that could have a direct and material effect on a major federal program or major state project in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on the internal control over compliance in accordance with OMB Circular A-133 and Chapter 10.550, Rules of the Auditor General. 1
Internal Control Over Compliance - Continued Our consideration of the internal control over compliance would not necessarily disclose all matters in the internal control 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 noncompliance with applicable requirements of laws, regulations, contracts and grants that would be material in relation to a major federal program or major state project being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses. Schedule of Expenditures of Federal Awards and State Financial Assistance We have audited the schedule of expenditures of federal awards and state financial assistance (the Schedule ) of the City for the year ended September 30, 2004. This Schedule is the responsibility of the City s management. Our responsibility is to express an opinion on this Schedule based on our audit. We conducted our audit of the Schedule in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations; and Chapter 10.550, Rules of the Auditor General. Those standards, OMB Circular A-133 and Chapter 10.550 require that we plan and perform the audit to obtain reasonable assurance about whether the Schedule is free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the Schedule. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall Schedule presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the Schedule referred to above presents fairly, in all material respects, the federal program expenditures and the state project expenditures of the City for the year ended September 30, 2004 in accordance with accounting principles generally accepted in the United States of America. This report is intended solely for the information and use of the Mayor, City Council, management, and specific legislative or regulatory bodies and is not intended to be and should not be used by anyone other than these specified parties. March 11, 2005 2
Section I - Summary of Auditor's Results Financial Statements Type of auditor's report issued: Unqualified Internal control over financial reporting:. Material weakness(es) identified? Yes X No. Reportable condition(s) identified that are not considered to be material weaknesses? Yes X None reported Noncompliance material to financial statements noted. Yes X No Federal Awards and State Financial Assistance Internal control over major federal programs and state projects:. Material weakness(es) identified? Yes X No. Reportable condition(s) identified that are not considered to be material weaknesses? Yes X None reported Type of auditor's report issued on compliance for major federal programs and state projects: Unqualified Any audit findings disclosed that are required to be reported in accordance with the Rules of the Auditor General? Yes X No Identification of major federal and state programs: CITY OF ORLANDO, FLORIDA SCHEDULE OF FINDINGS AND QUESTIONED COSTS For the Year Ended September 30, 2004 CFDA Number Name of Federal Program 16.000 & 21.000 Equitable Sharing of Federal Forfeited Property Program 20.205 Highway Planning and Construction 97.036 FEMA Public Assistance Grant CSFA Number Name of State Program 52.901 State Housing Initiatives Partnership Program Dollar threshold used to distinguish between type A and type B Programs: Federal $ 628,022 State $ 300,000 Does auditee qualify as low-risk? X Yes No Section II - Financial Statement Findings None 3
SCHEDULE OF FINDINGS AND QUESTIONED COSTS For the Year Ended September 30, 2004 Section III - Findings and Questioned Costs - Major Federal and State Award Programs State: None Federal: Finding # 1 - Repeat of Prior Year Finding CFDA #20.205 - Highway Planning and Construction During our review and testing of the Department of Transportation Highway Planning and Construction Program, we observed that the City's Public Works Department did not request reimbursements for capital expenditures incurred for all projects on a timely basis. However, substantial improvement was made in this area over the prior year. We noted no instances whereby projects tested had not been submitted for reimbursement. Furthermore, we noted that billings to the state were becoming more current as the fiscal year progressed. Our testing revealed no violations of the provisions of any of the contracts and agreements tested or noncompliance with the compliance requirements set forth in OMB's Compliance Supplement. In addition, the Management, Budget and Accounting Department properly accrued amounts due from FDOT at year end to properly reflect a receivable at year end and recognize the related revenue. The finding is related to the City's internal policies regarding billing and collections of amounts due from federal and state agencies on capital projects reimbursable under contracts and agreements with such agencies. We recommend that the City's Public Works Department continue its efforts to improve the billing and collection activities of project managers with regard to projects funded by federal or state grants. Grantee Response Public Works management concurs with the finding. Additional procedures were implemented during the current fiscal year to monitor project managers with regard to billing and collections. Management believes this will no longer be an issue in the next fiscal year. 4
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE FINANCIAL ASSISTANCE Year Ended September 30, 2004 FEDERAL PROGRAMS Federal Federal Identification CFDA Federal Federal Grantor/Pass-through Grantor/Program Title Number Number Expenditures U.S. Department of Agriculture: Summer Food Service Program 12-3539-0-1-605 10.559 $ 120,653 U.S. Department of HUD: Community Development Block Grant B-02MC-12-0015 14.218 2,185,441 B-03MC-12-0015 14.218 681,631 2,867,072 HOME Investment Partnership Program M-02-MC-12-0214 14.239 401,271 M-01-MC-12-0214 14.239 3,842 401,271 Housing Opportunities for Persons with AIDS FL29H01-F002 14.241 1,008,513 (Amount paid to subrecipients $1,526,137) FL29H02-F002 14.241 625,693 1,634,206 Emergency Shelter Grant S-02-MC-12-0008 14.231 34,531 S-03-MC-12-0008 14.231 53,206 87,737 Fair Housing Assistance FF204K034001 14.401 10,198 U.S. Department of Justice: Local Law Enforcement Block Grant 2002-LB-BX-0737 16.592 681,474 (Amount paid to subrecipients $231,432) 2003-LB-BX-1023 16.592 359,482 1,040,956 Weed and Seed Program 2003-WS-QX-0017 16.595 90,122 C.O.P.S 2001-UL-WX-0011 16.710 93,774 2001-SH-WX-0350 16.710 41,667 2001-CL-WX-0018 16.710 2,811 2002-UL-WX-0074 16.710 475,961 2002-CK-WX-0249 16.710 13,310 627,523 Federal Equitable Sharing Agreement NA 16.000 196,646 HIDTA 13-PCFP-512 16.001 21,406 14-PCFP-512Z 16.001 79,467 100,873 Metro-medical - DHHS Grant 233-02-0031 16.002 58,317 Continued 5
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE FINANCIAL ASSISTANCE - Continued Year Ended September 30, 2004 Federal Federal Identification CFDA Federal Federal Grantor/Pass-through Grantor/Program Title Number Number Expenditures U.S. Department of Treasury: GREAT Grant ATC03000214 21.053 26,578 Federal Equitable Sharing Agreement NA 21.000 972,647 (Amount paid to subrecipients $743,168) Equal Opportunity Employment Commission: Employment Discrimination - Title VII 4FPSLP0157 30.001 65,250 U.S. Department of Transportation: Passed through the Florida Department of Transportation: Shingle Creek Trail (Phase I) 405163-1-58-01/AJ878 20.205 389,767 SR 527 & Grant Avenue Mast Arms 239521-2-58-01/AL897 20.205 22,273 Conway Road (CR 506) 241699-1-38-01/AI861 20.205 169,067 Alden Road Bike Path 405240-1-58-01/AJ879 20.205 48,531 Bicycle Traffic Signals 410772-1-A8-01/AL202 20.205 60,599 Congestion Management Study 408428-1-28-01/AL201 20.205 215,315 Orange/Colonial Beautification Grant 413698-3-74-01/AM306 20.205 70 Boggy Creek/Landstreet Intersection 412986-1-58-01/AM144 20.205 56,704 962,326 National Foundation on the Arts and the Humanities Cultural Affairs Grant E04-7007 45.002 17,949 U.S. Department of Education: TAPS 799-1914A-4PCT1 84.002 39,669 U.S. Department of Health and Human Services: Medical Reserve Corps Coordinator Grant US25G-03042-02 93.008 7,072 Corporation for National and Community Service: Retired & Senior Volunteer Program 02SVHFL004-2002 YR 94.002 36,907 02SVHFL004-2003 YR 94.002 337,338 U.S. Department of Homeland Security: 374,245 Domestic Preparedness Equipment Program 00-EO-B4-13-00-22-003 97.004 66,785 Passed through the Florida Department of Community Affairs: Citizen's Corp CERT 03CC-96-06-58-02-427 97.004 8,422 Hispanic Citizens CERT 04-CT-IL-O6-58-02-227 97.004 16,180 91,387 FEMA Public Assistance Grant 095-53000-00 97.036 11,141,372 TOTAL EXPENDITURES OF FEDERAL PROGRAMS $ 20,934,069 Continued 6
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE FINANCIAL ASSISTANCE - Continued Year Ended September 30, 2004 STATE PROJECTS State State Identification CSFA State Grantor/Pass-through Grantor/Program Number Number Expenditures Florida Housing Finance Corporation: State Housing Initiatives Partnership Program FY 1999-2004 52.901 $ 2,290,136 Florida Department of Transportation: State-Joint Participation Agreement - Regional Traffic Management Center Relocation NA NA 252,229 Conway Road Beautification 239218-1-54-01 NA 2,095 Conser II - Reclaimed Water Turnout - Siedel Road 403498-3-56-01 NA 852,901 Florida Department of Environmental Protection: Clear Lake Park Trail T21028 NA 80,000 Florida Department of Law Enforcement: Domestic Violence Grant 04-CJ-J3-06-58-01-214 71.004 32,021 TOTAL EXPENDITURES OF STATE PROJECTS $ 3,509,382 NA - Not Available See accompanying notes to the schedule. 7
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE FINANCIAL ASSISTANCE Year Ended September 30, 2004 Note 1 - Basis of Presentation This schedule summarizes the expenditures incurred under all federal programs and state projects by the City of Orlando, Florida for the fiscal year ended September 30, 2004. For purposes of this schedule, federal programs and state projects include all grants and contracts entered into directly between the City and agencies and departments of federal or state governments. Federal programs and state projects passed through other government agencies, if any, are also included in the schedule. Expenditures for federal programs and state projects are recognized on the accrual basis of accounting, except for the FEMA Public Assistance Grant that is described in the next note. Note 2 - FEMA Public Assistance Grant Expenditures The City s comprehensive annual financial report shows $20.2 million in hurricane costs were incurred as of September 30, 2004. Of that amount, the City estimates it will receive reimbursements totaling $18.6 million from the FEMA Public Assistance Grant ($17.8 million) and the State of Florida s matching share ($.8 million). As of March 1, 2005, the City received actual reimbursements for approved Project Worksheets as follows: Hurricane Charley 05-PA-C%-06-58-02-809 Frances 05-PA-G%-06-58-02-759 Jeanne 05-PA-E=-06-58-02-642 Approved Project Reimbursements Received Worksheet Total Federal - State - Admin Fee Total - $7,478,803 $6,746,507 $354,773 $73,394 $7,174,674 $118,264 $115,997 $1,133 $3,365 $120,495 $66,297 $65,165 $565 $1,989 $67,719 Total $7,663,364 $6,927,669 $356,471 $78,748 $7,362,888 Actual Reimbursement as a Percentage of the Total Approved Project Worksheet Amount 90.40% 4.65% 1.03% 96.08% 8
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE FINANCIAL ASSISTANCE Year Ended September 30, 2004 Note 2 - FEMA Public Assistance Grant Expenditures, continued Applying those same reimbursement percentages to the project worksheets that were submitted to the State through March 1, 2005, an estimate of the total expenditures related to the FEMA Public Assistance Grant as of that date is computed as follows: Hurricane Charley 05-PA-C%-06-58-02-809 Frances 05-PA-G%-06-58-02-759 Jeanne 05-PA-E=-06-58-02-642 Submitted Project Estimate of Reimbursements to be Received Worksheet Total Federal - State - Admin Fee Total - $9,606,556 $8,684,327 $446,705 $98,948 $9,229,980 $2,546,212 $2,301,775 $118,399 $26,225 $2,446,399 $171,759 $155,270 $7,987 $1,769 $165,026 Total $12,324,527 $11,141,372 $573,091 $126,942 $11,841,405 Estimated Reimbursement as a Percentage of the Project Worksheets Submitted to the State 90.40% 4.65% 1.03% 96.08% Note 3 - Payments to Sub-recipients Amounts remitted to sub-recipients are shown parenthetically under the program title. 9