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City auditor: single audit tested grant compliance; no missing funds found
Summary
The auditor told Brentwood aldermen that the single-audit process tests compliance with federal grant requirements and that their testing found no missing items; the timing/cutoff correction was separate from grant compliance testing.
Alderman Tice asked the auditor to explain what a single audit covers and why the timing correction surfaced now. Auditor Adam told the board that a single audit is a test of compliance for federal grant funding and is triggered when a governmental entity spends more than $1,000,000 in federal funds in a year.
"A single audit is required for any entity that's spends, over 1000000 dollars in federal funding in a given year," Adam said. "That was something that the city had last year, and was subject to that single audit. And what that is is our testing then of the city's compliance with federal grant requirements." He added, "As it relates to the single audit ... nothing was missed. It was all there."
Adam distinguished that compliance testing from the financial audit timing issue that led to the $1,794,000 recognition shift: the single-audit testing covered grant compliance and did not identify the revenue recognition cutoff error, which the auditors later found and corrected.
The exchange clarified for aldermen that federal-grant compliance testing had not revealed any noncompliance, while the timing/cutoff correction related to governmental accounting recognition rules rather than grant misuse. The board voted to accept the revised audit after that explanation.
