CITY OF RIVERSIDE, CALIFORNIA
JUNE 30, 2021 SINGLE AUDIT REPORT
CITY OF RIVERSIDE, CALIFORNIA
SINGLE AUDIT REPORT
JUNE 30, 2021
CITY OF RIVERSIDE
SINGLE AUDIT REPORT
JUNE 30, 2021
TABLE OF CONTENTS
Page
Number
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 ...................................................................... 1
Independent Auditors’ Report on Compliance for Each Major Program and on Internal Control Over Compliance; and Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance ........................................................................................ 3
Schedule of Expenditures of Federal Awards for the
Fiscal Year Ended June 30, 2021 ........................................................................................................ 6
Notes to the Schedule of Expenditures of Federal Awards .................................................................... 8
Schedule of Findings and Questioned Costs for the
Fiscal Year Ended June 30, 2021 ........................................................................................................ 9
Schedule of Prior Year Findings and Questioned Costs for the Fiscal Year Ended June 30, 2020 ...................................................................................................... 11
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
To the Honorable Mayor and Members of the City Council
City of Riverside, California
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Riverside, California (the City), as of and for the year ended June 30, 2021, and the related notes to the financial statements, which collectively comprise the Ci t y ’ s b a s i c f i n a n c i a l s t a t e m e n t s, and have issued our report thereon dated November 9, 2021.
Internal Control over Financial Reporting
In planning and performing our audit of the financial statement s, we considered the City’s internal control over financial reporting (inter nal control) as a basis for desi gning audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility t hat a material misstatement of the entity’s financial statements will not be prevented, or detected and cor rected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpo se described in the first paragraph of this section and was not designed to identify all deficiencies in in ternal control that might be material weaknesses or, significant deficiencies. Given these limitation s, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City’s financial statements are free from material misstatement, we performed tests of its compliance wit h certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on complian ce with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are require d to be reported under Government Auditing Standards.
203 N. Brea Blvd., Suite 203
Brea, CA 92821 Lance, Soll & Lunghard, LLP Phone: 714.672.0022
To the Honorable Mayor and Members of the City Council
City of Riverside, California
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control or on compliance. This report is an integral part of an audit p erformed in accordance with Government Auditing Standards in considering the City ’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Brea, California
November 9, 2021
2 INDEPENDENT AUDITORS’ REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM
AND ON INTERNAL CONTROL OVER COMPLIANCE AND REPORT ON SCHEDULE OF
EXPENDITURES OF FEDERAL AWARDS REQUIRED BY THE UNIFORM GUIDANCE To the Honorable Mayor and Members of the City Council
City of Riverside, California
Report on Compliance for Each Major Federal Program
Opinion on Each Major Federal Program
We have audited the City of Riverside (the City), California ’ s compli an ce wi th the types of comp li ance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of the City ’s major federal programs for the year ended June 30, 2021. The City’s major federal programs are identified in the summary of auditor’s results section of the accompanying schedule of findings and questioned costs.
In our opinion, the City, complied, in all material respects, w ith the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2021.
Basis for Opinion
We conducted our audit of compliance in accordance with auditin g standards generally accepted in the United States of America (GAAS); the standards applicable to fin ancial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and t he audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Our responsibilities under those standards and the Uniform Guidance are further described in the Auditor’s Responsibilities for the Audit of Compliance section of our report.
We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with relevant ethical requirements relating to our audit. We believe the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Our audit does not provide a legal determination of the City’s compliance with the compliance requirements referred to above.
Responsibilities of Management for Compliance
Management is responsible for compliance with the requirements referred to above and for the design, implementation, and maintenance of effective internal control o ver compliance with the requirements of laws, statutes, regulations, rules, and provisions of contracts or grant agreements applicable to the City’s government programs.
203 N. Brea Blvd., Suite 203
Brea, CA 92821 Lance, Soll & Lunghard, LLP Phone: 714.672.0022
To the Honorable Mayor and Members of the City Council
City of Riverside, California
Auditor’s Responsibilities for the Audit of Compliance
Our objectives are to obtain reasonable assurance about whether material noncompliance with the compliance requirements referred to above, whether due to fraud or error, and express an opinion on the City’s compliance based on our audit. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS, Government Auditing Standards, and the Uniform Guidance will always detect material noncompl iance when it exists. The risk of not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Noncompliance with the compl iance requirements referred to above is considered material if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgment made by a reasonable user of the report on compliance about the City’s compliance with the requirements of the government program as a whole.
In performing an audit in accordance with GAAS, Government Auditing Standards , and Uniform Guidance, we:
x Exercise professional judgment and maintain professional skept icism throughout the audit.
x Identify and assess the risks of material noncompliance, wheth er due to fraud or error, and design and perform audit procedures responsive to those risks. Such p rocedures include examining, on a test basis, evidence regarding the City’s compliance with the compliance requirements referred to above and performing such other procedures as we considered necessary in the circumstances.
x Obtain an understanding of the City’s internal control over compliance relevant to the audit in order to design audit procedures that are appropriate in the circumst ances and to test and report on internal control over compliance in accordance with Uniform Gui dance, but not for the purpose of expressing an opinion on the effectiveness of the City’s intern al control over compliance.
Accordingly, no such opinion is expressed.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and any significant deficiencies and material weaknesses in internal control over compliance that we identified during the audit.
Report on Internal Control over Compliance
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow manage ment or employees, in the norma l course of performing their assigned functions, to prevent, or detect and correct, noncompliance wit h a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over comp liance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for t he limited purpose described in the Auditor’s Responsibilities for the Audit of Compliance section above and was not designed to identify all deficiencies in internal control over compliance. Given these limitations, during our audit we did not identify any deficiencies in internal control over compliance that we consider to be a material weakness, as defined above.
However, material weaknesses or significant deficiencies in internal control over compliance may exist that have not been identified.
4 To the Honorable Mayor and Members of the City Council City of Riverside, California
Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, no such opinion is expressed.
Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance
We have audited the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City, as of and for the year ended June 30, 2021, and the related notes to the financial statement s, which collectively comprise the City ’s basic financial statements. We issued our report thereon dated November 9, 2021, which contained unmodified opinions on those financial statements. Our audit wa s conducted for the purpose of forming opinions on the financial statem ents that collectively comprise t h e b a s i c f i n a n c i a l s t a t e m e n t s . T h e accompanying schedule of expenditures of federal awards is presented for purposes of additional analysis as required by the Uniform Guidance and is not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financia l statements. The information has been subjected to the auditing procedures applied in the audit of th e financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the schedule of expenditures of federal awards is fairly stated in all material respects in relation to the basic financial statements as a whole.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that tes ting based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose.
Brea, California
December 13, 2021 (except for the schedule of Expenditures of F ederal Awards which is as of November 9, 2021).
5 CITY OF RIVERSIDE
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
Assistance Pass-Through Passed
Listing Entity Identifying Through to
Federal Grantor/Pass-Through Grantor/Program Title Number Number Subrecipients Expenditures CDBG - Entitlement Grants Cluster
U.S. Department of Housing and Urban Development
Direct Programs:
Community Development Block Grants/Entitlement Grants 14.218 N/A 1,165,581$ 3,582,407$ CDBG Loans Program with Compliance Requirements 14.218 N/A - 118,399 Total CDBG - Entitlement Grants Cluster 1,165,581 3,700,806 Federal Transit Cluster
U.S. Department of Transportation
Direct Programs:
Federal Transit - Formula Grants * 20.507 N/A - 190,228 COVID-19 -- Federal Transit - Formula Grants * 20.507 N/A - 5, 433,880 Bus and Bus Facilities Formula Program 20.526 N/A - 1,459 Total Federal Transit Cluster - 5,625,567 Highway Planning and Construction Cluster
U.S. Department of Transportation
Pass-through the California Department of Transportation:
Highway Planning and Construction * 20.205 various - 2, 124,075 Total Highway Planning and Construction Cluster - 2,124,075 Highway Safety Cluster
U.S. Department of Transportation
Pass-through State of California Office of Traffic Safety:
State and Community Highway Safety 20.600 various - 199,444 National Priority Safety Programs 20.616 OP1507 - 36,691 Total Highway Safety Cluster - 236,135 Other Programs
U.S. Department of Housing and Urban Development:
Direct Programs:
Emergency Solutions Grants Program 14.231 N/A 549,057 549,057 Home Investment Partnerships Program * 14.239 N/A - 774,649 HOME Loans Program with Compliance Requirements 14.239 N/A - 1, 104,927 Total Home Investment Partnerships Program - 1, 879,576 Housing Opportunities for Persons with AIDS 14.241 N/A 2,776,414 2,825,338 Continuum of Care Program 14.267 N/A - 194,628 Total U.S. Department of Housing and Urban Development 3,325,471 5, 448,599 U.S. Department of Justice
Direct Programs:
Missing Children's Assistance 16.543 N/A - 224,871 Bulletproof Vest Partnership Program 16.607 N/A - 27,008 Edward Byrne Memorial Justice Assistance Grant Program 16.738 N/A 92,339 231,289 Body Worn Camera Policy and Implementation 16.835 N/A - 8,186 Equitable Sharing Program 16.922 N/A - 247,005 Total U.S. Department of Justice 92,339 738,359 U.S. Department of Transportation
Direct Programs:
Airport Improvement Program 20.106 N/A - 109,328 Pass-through State of California Office of Traffic Safety:
Minimum Penalties for Repeat Offenders for Driving While Intoxicated 20.608 various - 195,176 Total U.S. Department of Transportation - 304,504 U.S. Department of Treasury
Direct Programs:
Asset Forfeiture 21.U01 N/A - 51,630 COVID-19 -- Coronavirus Relief Fund * 21.019 N/A 15,835,723 31,986,432 Total U.S. Department of Treasury 15,835,723 32, 038,062 6 CITY OF RIVERSIDE
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
Assistance Pass-Through Passed
Listing Entity Identifying Through to
Federal Grantor/Pass-Through Grantor/Program Title Number Number Subrecipients Expenditures Executive Office of the President - Office of National Drug Control Policy Pass-through State of California:
High Intensity Drug Trafficking Areas Program 95.001 07-I5PLAP540 Z- 295,912 Total Executive Office of the President - Office of National Drug Control Policy - 295,912
U.S. Department of Homeland Security
Direct Programs:
National Urban Search and Rescue (US&R) Response System 97.025 N/A- $ 1 ,652,988$ Assistance to Firefighters Grant 97.044 N/A - 142,588 Pass-through State of California:
Homeland Security Grant Program * 97.067 065-62000 567,770 1,190,560 Pass-through Riverside County:
Homeland Security Grant Program 97.067 various - 126,951 Emergency Management Performance Grants 97.042 2011-0048 - 2,432 Total U.S. Department of Homeland Security 567,770 3,115,519 Total Other Programs 19,821,303 41, 940,955
Total Federal Expenditures 20,986,884$ 53,627,538 $
Assistance Pass-Through Passed
Listing Entity Identifying Through to
Federal Grantor/Pass-Through Grantor/Program Title Number Number Subrecipients Expenditures U.S. Department of Transportation
Direct Programs:
Federal Transit - Formula Grants * 20.507 N/A - $ 5 ,433,880$ Total U.S. Department of Transportation - 5, 433,880 U.S. Department of Treasury
Direct Programs:
Coronavirus Relief Fund * 21.019 N/A 15,835,723 31,986,432 Total U.S. Department of Treasury 15,835,723 31, 986,432 Total Coronavirus Emergency Acts Funding 15,835,723$ 37,420,312 $ * Denotes major program
Note a: Refer to Note 1 to the schedule of expenditures of federal awards for a description of significant accounting policies used in preparing this schedule.
Note b: There were no federal awards expended in the form of noncash assistance and insurance in effect during the year.
CORONAVIRUS EMERGENCY ACTS FUNDING RECONCILIATION
7 CITY OF RIVERSIDE
NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED JUNE 30, 2021
Note 1: Summary of Significant Ac counting Policies Applicable to the Schedule of Expenditures of Federal Awards
a. Scope of Presentation
The accompanying schedule presents only the expenditures incurr ed by the City of Riverside, California, that are reimbursable under federal programs of federal financial assistance. For the purposes of this schedule, federal awards include both federal financial assistance received directly from a federal agency, as well as federal funds received indirectly by the City from a non-federal agency or other organ ization. Only the portion of program expenditures reimbursable with such federal funds is reported in the accompanying schedule. Program expenditures in excess of the maximum federal reimbursement authorized or the portion of the program expenditures that were funded with state, local or other non-federal funds are excluded from the accompanying schedule.
b. Basis of Accounting
The expenditures included in the accompanying schedule were rep orted on the modified accrual basis of accounting. Under the modified accrual basis of accounting, expenditures are incurred when the City becomes obligated for payment as a result of the receipt of the related goods and services. Expenditures reported included any property or equipment acquisitions incurred under the federal program.
c. Indirect Cost Rate
The City has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance.
Note 2: Federal Loan Programs with Compliance Requirements
Loans outstanding at the beginning of the year and loans made during the year are included in the federal expenditures presented in the accompanying schedule . The balance of loans outstanding with compliance requirements at June 30, 2021, consists of:
Assistance
Listing Number Program Name
Balance at
June 30, 2021
14.218 CDBG Loans Program 117,274$
14.239 HOME Loans Program 898,907
Total loans subject to continuing compliance requirements 1,016,181$
8 CITY OF RIVERSIDE
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
SECTION I - SUMMARY OF AUDITORS' RESULTS
Financial Statements
Type of auditors' report issued: Unmodified Opinion
Internal control over financial reporting:
x Significant deficiencies identified? yes X no
x Material weaknesses identified? yes X none repo rted
Noncompliance material to financial
statements noted? yes X no
Federal Awards
Internal control over major programs:
x Significant deficiencies identified? yes X no
x Material weaknesses identified? yes X none repo rted
Type of auditors' report issued on compliance for major programs: Unmodified Opinion
Any audit findings disclosed that are required to be
reported in accordance with Title 2 U.S. Code of
Federal Regulations (CFR) Part 200, Uniform
Administrative Requirements, Cost Principles, and
Audit Requirements for Federal Awards (Uniform
Guidance)? yes X no
Identification of major programs:
Assistance Listing Number Name of Federal Program or Cluster
14.218 CDBG – Entitlement Grants Cluster
20.526, 20.507 Federal Transit Cluster
20.205 Highway Planning and Construction Cluster
21.019 Coronavirus Relief Fund
97.067 Homeland Security Grant Program
Dollar threshold used to distinguish
between type A and type B program $1,608,826
Auditee qualified as low-risk auditee? X yes _ n o 9 CITY OF RIVERSIDE
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
SECTION II - FINANCIAL STATEMENT FINDINGS
No matters were reported.
SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
No matters were reported.
10 Finance
Department
3900 Main Street, Riverside, CA 92522 | Phone: (951) 826-5553 | Fax: (951) 826-5470 | RiversideCA.gov
SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2020
SECTION II - FINANCIAL STATEMENT FINDINGS
No matters were reported
SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported.
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