MInutes 02-06-2024 - Business Meeting

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10 Slide#13 Orange Coufrty, North Caraifr'fra Audit Findinrf • 2023-DUI Reporting of Ern piayee Costs to NCDHHS In our testing of employee costs charged to the Medicaid and SNAP prograims,we noted four 141 total instances tthrcee t3)out of forty�40)for Medicaid and one(1)out of forty(40)For SNAP]where the employee's day sheet twheretime is tracked by servicecode in 6-minute increments)included more time than the employeesapproved timesheet for the week. No questioned casts noted. Management Points(Recommendations) Capitalization Thresholds for Right-to•Vse Assets - over the last two(4 fiscal perlods,the County was required to Implement the provlslons of two 12)Hero accounting standards 1GASB statement No.97.teoSeS and Casa statement No.96,5065crpdon-basedJx40MOt10r1 Techrlaggy Arrorlgemenrs) that have slgnlflcondy changed the way local governments account for leasing acdvliles and Information technology ffl contracts. These new standards have created a new class of asset that Is recorded In the Countys statement of net poslilon known as a'rlghrto-use"asset. similar to capltal assets,these rlghrto-use assets are capltallxed and amortlnd aver the Ilfe of the underlying agreementl&]or underlying asset`&usefui life lwhlchever Is shortel. We recommend the Coumy adapt a capltallzadon threshold far recording rlghrto-use assets In the same way that the County has a caplullzadon threshold for recording tangible capltal assets. Establishing a threshold will make It easlef for the County to more effioendy evaluate agreements that could give rise to the recording of right-to-use assets and ellminate what could be tlme spent on Items that are Imrnmerlal ro the coumys fmnclal statements. Aurdbr'3 Nswssko it AnatySfS fAD June 30,2023 Slide #14 Orange County, North Carafinn Management Polnts(Recommendations) County Reimbursement for Sales Taxes Paid During our testng of the amounts recelved by the county from the North Carollne Department of Revenue tNCDoft]during the f]scal year ended]une 30..Zu23�we noted the county did not re€elve a relenbursement of sales taxes p revlou&ly palo. Based an ou r dlscu&slon with management of the county,the NCDOR submittal Is normally a part of year-end processing that has been delayed such that the County has not eecelved tnew funds from NCDOR yet. Management Is In the process of pfeparing the applIcatlon for relmbursement that is requlred to be sent to NCDOR before the funds are released. Addldonally,we have noted that management has implemented addlilortal Internal controls to ensure ihls Is not overlooked during the annual closeout process in future rascal years. Accounting for Special Revenue Funds During our review of the Countys financial statements,we noted the DSS Payee Fund did not have any revenue or expenditure activity for the fiscal year under audit. Based on our review of the general ledger activity,it appears the County is still accouming for this Fund as if it was still a custodial fund of the County where all amounts are received as cash and offset with a corresponding liability. With the change in accounting standard that was brought about by GASB Statement No.94,RdudaryActitdties,this fund was reclassified to a special revenue Fund in previous years and should be reflecting the inflows it receives during the fiscal year as revenues and conversely,the outflows as expenditures. Due to the fact that the activity for the fiscal year ended June 30,2021 was not material,an audit adjustment to reclassify the activity was not required. However,we recommend County staff implement additional internal controls or additional annual closeout procedures to the ensure the amounts are properly recorded in accordance with generally accepted accounting principles(GAAP). Au&W'S Dkscussthm 9 Antifysfs WU) JWna 3a 2023