CONEJOS COUNTY, COLORADO

Finding 2024-003: Local Assistance and Tribal Consistency Fund, Assistance Listing No. 21.032, U.S. Department of Treasury Compliance Requirements: Reporting Grant No.: N/A Type of finding: Internal Control (material weakness) and Compliance (material noncompliance) Criteria: The Reporting Guidance for the Local Assistance and Tribal Consistency Fund (LACTF) requires the County as the recipient to submit an Obligation and Expenditure Report annually. This report should include aggregate obligations and expenditures by governmental purpose reporting category which should match County LATCF grant expenditures reported in the financial statements within 10 percent. Condition: The County overreported current period LATCF obligations and expenditures by $482,368 which is greater than a 10% difference on the annual 2024 Obligation and Expenditure Report. Cause: The County does not have a complete system of internal controls that provides for the review of the Obligation and Expenditure Report. Questioned Costs: None Effect: The Obligation and Expenditure Report contained errors and was not in compliance with the financial reporting requirements of the Reporting Guidance. Recommendation: The County should strengthen its internal controls with adopted policies and procedures to ensure accurate financial reporting in compliance with the Reporting Guidance for the Local Assistance and Tribal Consistency Fund. Management’s Response: See corrective action plan.

Finding 2024-004: Internal Control over Compliance Type of finding: Internal Control (material weakness) and Compliance (material noncompliance) Criteria: The Report submission portion of the Uniform Administrative Requirements, Cost Principles, and Audit Requirements (Subpart F: 2 CFR 200.512) requires that an auditee submit the Single Audit reporting package and data collection form earlier of nine months after the end of the audit period or 30 calendar days after the County received the Auditors’ report. Condition: The County did not submit the Single Audit reporting package to the Federal Audit Clearinghouse and data collection form by the due date of September 30, 2025. Cause: The County does not have a system of internal control in place to perform year-end financial close and reporting in a timely manner. Effect: The County is not in compliance with Uniform Administrative Requirements, Cost Principles, and Audit Requirements (Subpart F: 2 CFR 200.512). Recommendation: The County should strengthen its internal controls over year-end financial close and reporting with adopted policies and procedures to ensure compliance with the Report submission portion of the Uniform Administrative Requirements, Cost Principles, and Audit Requirements section. Management’s Response: See corrective action plan.

Finding 2023-003: Forest Service Schools and Roads Cluster, Federal Assistance Listing No. 10.665 U.S. Department of Agriculture Passed-through Colorado Department of Treasury Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Grant No.: Title I and III Type of finding: Internal Control (significant deficiency) and Compliance (noncompliance) Criteria: The authorized uses portion of the Title III – County Funds section (16 USC 7141-7144) states that Title III funds shall only be used to 1) carry out activities under the Firewise Communities program, 2) reimburse the County for search and rescue and other emergency services, or 3) develop community wildfire protection plans. Condition: Title III funds were incorrectly included with the Title I funds computation for distribution to the local school districts and the Road and Bridge Fund. Cause: The County does not have a complete system of internal controls to ensure that federal funds are used for allowable purposes. Questioned Costs: None Effect: Title III funds were not separately identified and tracked to ensure compliance with activities allowed or unallowed and allowable costs/cost principles requirements. Recommendation: The County should strengthen its internal controls with adopted policies and procedures to ensure compliance with the authorized uses portion of the Title III – County Funds section. Management’s Response: See corrective action plan.