HomeMy WebLinkAbout2013-COH - Single Audit of Federal Financial Assistance ProgramsA Ccuit
LLP
CERTIFIED PUBLIC ACCOUNTANTS
County of Hawaii
State of Hawaii
Single Audit of Federal Financial Assistance Programs
June 30, 2013
Quality Integrity Insight
County of Hawaii
State of Hawaii
Index
June 30, 2013
Page(s)
Introduction
AuditObjectives............................................................................................................................................
1
Scopeof Audit...............................................................................................................................................2
Organizationof Report..................................................................................................................................
2
Compliance and Internal Control over Financial Reporting
Report of Independent Auditors 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
Compliance and Internal Control over Federal Awards
Report of Independent Auditors on Compliance for Each Major Program,
Internal Control Over Compliance and the Schedule of Expenditures of
Federal Awards Required by OMB Circular A-133
Schedule of Expenditures of Federal Awards.........................................................................................
8-18
Notes to Schedule of Expenditures of Federal Awards..............................................................................
19
Schedule of Findings and Questioned Costs........................................................................................
20-25
Corrective Action Plan
SECTION
Introduction
A Ccuit
LLP
CERTIFIED PUBLIC ACCOUNTANTS
December 24, 2013
To the Chair and Members of the County Council
County of Hawaii
We have completed our audit of the basic financial statements of the County of Hawaii, State of Hawaii
(the "County"), as of and for the year ended June 30, 2013. Our report containing our opinion on those
basic financial statements is included in the County's Comprehensive Annual Financial Report. We
have also audited the County's compliance with requirements applicable to its major federal financial
assistance programs. We submit herein our reports on compliance and on internal control over financial
reporting and over federal awards, the County's schedule of expenditures of federal awards, and the
schedule of findings and questioned costs.
The audit objectives and scope of the audit were as follows:
Audit Objectives
1. To provide opinions on the fair presentation of the County's basic financial statements and the
schedule of expenditures of federal awards as of and for the year ended June 30, 2013 in accordance
with accounting principles generally accepted in the United States of America.
2. To consider the County's internal control over financial reporting in order to design our auditing
procedures for the purpose of expressing our opinions on the financial statements.
3. To perform tests of the County's compliance with certain provisions of laws, regulations, contracts,
and grant agreements that could have a direct and material effect on the determination of financial
statement amounts.
4. To consider the County's internal control over compliance for each major federal program in order to
determine our auditing procedures for the purpose of expressing our opinion on compliance, to test
and report on internal control over compliance and report on the schedule of expenditures of federal
awards required by U.S. Office of Management and Budget ("OMB") Circular A-133, Audits of States,
Local Governments, and Non -Profit Organizations.
5. To provide an opinion on the County's compliance with the requirements of laws, regulations,
contracts, and grants that could have a direct and material effect on each major program.
6. To report on the status of prior year findings and questioned costs.
339 BISHOP STREET, SUITE 1900
an independent member of
HONOLULU, HAWAII 90813
BAKER T I L LY TELEPHONE: 808 5313400 FAC SIMILE : 808 5313433
INTERNATIONAL
To the Chair and Members
of the County Council
County of Hawaii
December 24, 2013
Page 2
Scoae of Audit
We performed an audit of the County's basic financial statements and schedule of expenditures of federal
awards as of and for the year ended June 30, 2013, 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; and the
provisions of OMB Circular A-133.
Organization of Report
Our report is organized into three sections as follows:
1. Section I, entitled "Introduction," describes the objectives and scope of our audit and the organization
and contents of this report.
2. Section II, entitled "Compliance and Internal Control over Financial Reporting," contains our report
on the County's internal control over financial reporting and on compliance and other matters based
upon our audit of the County's basic financial statements.
3. Section III, entitled "Compliance and Internal Control over Federal Awards," contains our report on
the County's compliance for each major program, internal control over compliance and the schedule
of expenditures of federal awards required by OMB Circular A-133, the County's schedule of
expenditures of federal awards, and the schedule of findings and questioned costs.
Our report on the basic financial statements of the County as of and for the year ended June 30, 2013 is
included under a separate cover. A separate management letter containing our observations regarding
the County's internal controls dated December 24, 2013 has also been issued to the County Council.
We would like to take this opportunity to express our appreciation to the personnel of the County of
Hawaii for the cooperation and assistance extended to us during our audit. We will be pleased to
discuss any questions that you or your associates may have regarding our recommendations.
Very truly yours,
�� � LLQ
SECTION II
Compliance and Internal Control
Over Financial Reporting
A Ccuit
LLP
CERTIFIED PUBLIC ACCOUNTANTS
Report of Independent Auditors 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 Chair and Members of the County Council
County of Hawaii
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, the discretely presented component unit, each major fund, and the
aggregate remaining fund information of the County of Hawaii, State of Hawaii (the "County") as of and
for the year ended June 30, 2013, and the related notes to the financial statements, which collectively
comprise the County's basic financial statements, and have issued our report thereon dated
December 24, 2013.
Internal Control over Financial Reaortin
In planning and performing our audit of the financial statements, we considered the County's internal
control over financial reporting ("internal control") to determine the 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 County's internal control. Accordingly,
we do not express an opinion on the effectiveness of the County'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 that a material
misstatement of the entity's financial statements will not be prevented, or detected and corrected 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 purpose described in the first paragraph of this
section and was not designed to identify all deficiencies in internal control that might be material
weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may
exist that were not identified. Given these limitations, 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. We did identify a deficiency in internal control, described in Finding No.
2013-001 in the accompanying schedule of findings and questioned costs that we consider to be a
significant deficiency.
339 BISHOP STREET, SUITE 1900
an independent member of
HONOLULU, HAWAII 90813
BAKER T I L LY TELEPHONE: 808 5313400 FAC SIMILE : 808 5313433
INTERNATIONAL
Comaliance and Other Matters
As part of obtaining reasonable assurance about whether the County's financial statements are free from
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts, and grant agreements, noncompliance with which could have a direct and material effect on the
determination of financial statement amounts. However, providing an opinion on compliance 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 required to be
reported under Government Auditing Standards.
County's Response to Finding
The County's response to the finding identified in our audit is described in the accompanying corrective
action plan. The County's response was not subjected to the auditing procedures applied in the audit of
the financial statements and, accordingly, we express no opinion on it.
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 result of that testing, and not to provide an opinion on the effectiveness of the entity's internal
control or on compliance. This report is an integral part of an audit performed in accordance with
Government Auditing Standards in considering the entity's internal control and compliance. Accordingly,
this communication is not suitable for any other purpose.
l�CZG��-�-�
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Honolulu, Hawaii
December 24, 2013
SECTION III
Compliance and Internal Control
Over Federal Awards
A Ccuit
LLP
CERTIFIED PUBLIC ACCOUNTANTS
Report of Independent Auditors on Compliance for Each Major Program, Internal Control Over
Compliance and the Schedule of Expenditures of Federal Awards Required by OMB Circular A-133
To the Chair and Members of the County Council
County of Hawaii
Resort on Comaliance for Each Maior Federal Proaram
We have audited the County of Hawaii, State of Hawaii's (the "County") compliance with the types of
compliance requirements described in the OMB CircularA-133 Compliance Supplement that could have a
direct and material effect on each of the County's major federal programs for the year ended June 30,
2013. The County's major federal programs are identified in the summary of auditors' results section of
the accompanying schedule of findings and questioned costs.
Management's Responsibility
Management is responsible for compliance with the requirements of laws, regulations, contracts, and
grants applicable to its federal programs.
Auditors' Responsibility
Our responsibility is to express an opinion on compliance for each of the County's major federal programs
based on our audit of the types of compliance requirements referred to above. 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; and OMB Circular A-133, Audits of States, Local Governments,
and Non -Profit Organizations. Those standards and OMB Circular A-133 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 occurred. An audit includes examining, on a test basis, evidence about the County'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 on compliance for each major
federal program. However, our audit does not provide a legal determination of the County's compliance.
Opinion on Each Major Federal Program
In our opinion, the County complied, in all material respects, with 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, 2013.
339 BISHOP STREET, SUITE 1900
an independent member of
HONOLULU, HAWAII 90813
BAKER T I L LY TELEPHONE: 808 5313400 FAC SIMILE : 808 5313433
INTERNATIONAL
Resort on Internal Control Over Comaliance
Management of the County is responsible for establishing and maintaining effective internal control over
compliance with the types of compliance requirements referred to above. In planning and performing our
audit of compliance, we considered the County's internal control over compliance with the types of
requirements that could have a direct and material effect on each major federal program to determine the
auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on
compliance for each major federal program and to test and report on internal control over compliance in
accordance with OMB Circular A-133, but not for the purpose of expressing an opinion on the
effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the
effectiveness of the County's 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 management or employees, in the normal course of performing their assigned
functions, to prevent, or detect and correct, noncompliance with 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 combination of deficiencies, in internal control over compliance, 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 with a type of compliance requirement of a federal program 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 the limited purpose described in the first
paragraph of this section and was not designed to identify all deficiencies in internal control over
compliance that might be material weaknesses or significant deficiencies. We did not identify any
deficiencies in internal control over compliance that we consider to be material weaknesses. However,
material weaknesses may exist that have not been identified.
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 testing based on the requirements of
OMB Circular A-133. Accordingly, this report is not suitable for any other purpose.
Report on Schedule of Expenditures of Federal Awards Required by OMB Circular A-133
We have audited the financial statements of the governmental activities, the business -type activities, the
discretely presented component unit, each major fund, and the aggregate remaining fund information of
the County as of and for the year ended June 30, 2013, and the related notes to the financial statements,
which collectively comprise the County's basic financial statements. We have issued our report thereon
dated December 24, 2013, which contained unmodified opinions on those financial statements. Our audit
was conducted for the purpose of forming opinions on the financial statements that collectively comprise
the basic financial statements. The accompanying schedule of expenditures of federal awards is
presented for purposes of additional analysis as required by OMB Circular A-133 and is not a required
part of the financial statements. As described in Note 1 to the schedule of expenditures of federal
awards, the accompanying schedule of expenditures of federal awards was prepared on the cash basis of
accounting, which is a comprehensive basis of accounting other than accounting principles generally
accepted in the United States of America. 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
financial statements. The information has been subjected to the auditing procedures applied in the audit
of the 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
financial statements as a whole.
Honolulu, Hawaii
December 24, 2013
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County of Hawaii
State of Hawaii
Notes to Schedule of Expenditures of Federal Awards
Year Ended June 30, 2013
1. Basis of Presentation
The accompanying schedule of expenditures of federal awards includes the federal grant activity
of the County of Hawaii, State of Hawaii (the "County") and its discretely presented component
unit, the Department of Water Supply (the "Department") and is presented on the cash basis of
accounting. The information in this schedule is presented in accordance with the requirements
of OMB Circular A-133, Audits of States, Local Governments, and Non -Profit Organizations.
Therefore, some amounts presented in this schedule may differ from amounts presented in,
or used in the preparation of, the basic financial statements.
2. Subrecipients
Of the federal expenditures presented in the schedule, the County provided federal awards to
subrecipients as follows:
Program Title
U.S. Department of Housing and Urban Development
Community Development Block Grant/State's Program and
Non -Entitlement Grants in Hawaii
HOME Investment Partnerships Program
Total U.S. Department of Housing and
Urban Development
U.S. Department of Justice
Juvenile Accountability Incentive Block Grant
Juvenile Justice and Delinquency Prevention — Allocation to States
Crime Victim Assistance
Total U.S. Department of Justice
U.S. Department of Labor
WIA Adult Program
WIA Youth Activities
WIA Dislocated Workers
ARRA — Program of Competitive Grants for Worker Training and
Placement in High Growth and Emerging Industry Sectors
Total U.S. Department of Labor
U.S. Department of Health and Human Services
Substance Abuse and Mental Health Services — Projects of
Regional and National Significance
Total U.S. Department of Health and
Human Services
Total Provided to Subrecipients
19
16.523
16.540
16.575
17.258
17.259
17.278
17.275
93.243
58,900
19,800
455733
124,433
466,385
3555552
317,857
65,103
1,204,897
815702_
815702
$
159715259
Amount
CFDA
Provided to
Number
Subrecipients
14.228
$ 755763
14.239
4845464
560.227
16.523
16.540
16.575
17.258
17.259
17.278
17.275
93.243
58,900
19,800
455733
124,433
466,385
3555552
317,857
65,103
1,204,897
815702_
815702
$
159715259
County of Hawaii
State of Hawaii
Schedule of Findings and Questioned Costs
Year Ended June 30, 2013
Section I — Summary of Auditors' Results
Financial Statements
Type of auditors' report issued Unmodified
Internal control over financial reporting
• Material weaknesses identified? yes X no
• Significant deficiencies identified? X yes none reported
Noncompliance material to financial statements noted? yes X no
Federal Awards
Internal control over major programs
• Material weaknesses identified? yes X no
• Significant deficiencies identified? yes X none reported
Type of auditors' report issued on compliance for major programs Unmodified
Any audit findings disclosed that are required to be reported
in accordance with section 510(a) of Circular A-133? yes X no
Identification of major programs
CFDA
Numbers Name of Federal Program or Cluster
14.228 Community Development Block Grants/State's
Program and Non -Entitlement Grants in Hawaii
17.258/17.259/17.278 WIA Cluster
20.205 Highway Planning and Construction
66.458 Capitalization Grants for Clean Water State Revolving Funds
66.468 Capitalization Grants for Drinking Water State Revolving Funds
Dollar threshold used to distinguish between type A and
type B programs $113071000
Auditee qualified as low-risk auditee? X yes no
20
County of Hawaii
State of Hawaii
Schedule of Findings and Questioned Costs
Year Ended June 30, 2013
Section II — Financial Statement Findings
Finding No. 2013-001: Information Technology (Significant Deficiency)
Condition
Information technology ("IT") is a strategic element of the operations of the County of Hawaii (the
"County") and the Department of Water Supply (the "Department"), a component unit of the County.
Because of the high volume of transactions at the County and the Department, the establishment of
internal controls over processes incorporating IT is critical to its operations. As part of our financial
statement audits for the year ended June 30, 2013, we performed IT general controls reviews of the
following systems operated by the County and the Department:
Count
• Windows Domain
• Eden
• Integrated Assessment System
• Revenue Collection
Department
• Windows Domain
• Select Financial System
• Public Utility Billing System
• ARB N_Sight Mobile System
Our review resulted in several IT control deficiencies in the areas of physical and logical security, change
management, and IT operations as follows:
Physical and logical security
• Lack of formal security administration policies and procedures addressing:
o New, transferred and terminated user account administration
o Maintenance of audit evidence to support approval of employee access to the system
o Identification of terminated employees who continue to have access to the system
o Identification of employees whose access to system resources are not commensurate
with their job responsibilities
o Minimum password security settings
o Network security reviews
o Minimum environmental security requirements
o Physical access to the servers
• Weak password security settings or the lack of system functionality to enforce strong password
policies for certain applications.
• System databases are not appropriately restricted and monitored for unauthorized changes.
• Appropriate user access reviews are not performed for certain applications and security groups.
Cage management
• Lack of a formalized change management process for certain applications and firewall configuration
settings.
• Lack of segregation of duties for developers and security administrators.
IT Operations
• Test restorations not performed.
21
County of Hawaii
State of Hawaii
Schedule of Findings and Questioned Costs
Year Ended June 30, 2013
Criteria
When IT is used to initiate, record, process, and report on transactions included in the financial
statements, the systems and related processes should include internal controls to prevent or detect
potential misstatements.
Effect
Internal controls in the following areas address the following risks:
Physical and logical security
Unauthorized access to these systems could result in either the destruction or theft of data, unauthorized
or nonexistent transactions being made or transactions being inaccurately recorded.
Cage management
Unauthorized or untested changes promoted to the production environment could cause the systems
to either process data differently than intended or unexpectedly compromise the integrity of the data
maintained.
IT Operations
Lack of restoration testing could result in the inability to recover from data loss, corruption, or data
integrity concerns.
Causes
The primary cause of the internal control deficiencies identified was due to the lack of IT policies and
procedures which include internal controls to address the IT risks discussed above.
Recommendation
We recommend that the County perform the following:
• Develop and implement IT policies and procedures to include internal control procedures addressing
the IT risks above.
• Indentify procedures to ensure that IT policies and procedures are consistently followed.
• Implement change management detective controls.
• Perform annual test restoration exercises.
22
County of Hawaii
State of Hawaii
Schedule of Findings and Questioned Costs
Year Ended June 30, 2013
Section III — Federal Award Findings and Questioned Costs
None
23
County of Hawaii
State of Hawaii
Schedule of Findings and Questioned Costs
Year Ended June 30, 2013
Section IV — Status of Prior Year Findings and Questioned Costs
Financial Statement Findings
Finding No. 2012-01: Information Technology (Significant Deficiency)
During our prior audits, we performed IT general controls reviews of the following systems operated by
the County and the Department:
Count
• Windows Domain
• Eden
• Integrated Assessment System
• Revenue Collection
Department
• Windows Domain
• Select Financial System
• Public Utility Billing System
• ARB N_Sight Mobile System
Our review resulted in several IT control deficiencies over physical and logical security and change
management.
Status
Partially resolved. In fiscal year 2013, the County and the Department took the following actions to
address the control deficiencies listed above:
• The County installed software designed to monitor its systems for unauthorized activity and was in
the process of testing the software at June 30, 2013.
• The County implemented a software program to generate reports for user access reviews of the
Windows domain and was developing a process to distribute the reports for review at June 30, 2013.
• The Department implemented formal backup and restore policies for the Public Utility Billing System.
• The Department moved the Public Utility Billing System to a physically secure server room.
• The Department performed a terminated user access review for the Select Financial System and the
Public Utility Billing System.
The remaining IT control deficiencies have not been resolved; however, the County and the Department
are in the process of developing policies and procedures to address them. As the unresolved
deficiencies are reported in current year Finding 2013-001, this finding will not carry forward.
24
County of Hawaii
State of Hawaii
Schedule of Findings and Questioned Costs
Year Ended June 30, 2013
Finding No. 2009-01: Activities Allowed and Unallowed — Calculation of
Federal Expenditures
Federal Agency:
CFDA Number and Title:
Award Number and Award
Year:
U.S. Department of Homeland Security
97.036 — Disaster Grants — Public Assistance
(Presidentially Declared Disasters): Kiholo
Earthquake
FEMA -1664 -DR -HI 10/15/06 — 10/15/10
Questioned
Cost
$ 27,965
Per the prior auditor's testing of the activities allowed and unallowed compliance requirement, it
was noted that the County overstated the federal share of eligible costs related to the Ikuo Hisaoka
Gymnasium by $27,965. The amount the County reported was based on the actual expenditures,
however, as the Ikuo Hisaoka Gymnasium was insured at the time of loss, the expenditures should
have been based on the insurance deductible in accordance with Title 44 Code of Federal Regulations
(44 CFR) §206.250(c).
Status
Unresolved. We understand that the County has sought the assistance of the Hawaii State Civil Defense
in determining the correct portion eligible for federal aid and is still awaiting a response.
25
Corrective Action Plan
CORRECTIVE ACTION PLAN
Financial Statement Findings:
Finding 2013-001 Information Technology (Significant Deficiency)
Recommendation: We recommend that the County and/or the Department perform the following:
• Develop or update IT policies and procedures to include internal control procedures addressing
the IT risks above.
• Identify procedures to ensure that IT policies and procedures are consistently followed.
• Implement change management detective controls.
• Perform annual test restoration exercises.
General Comment: Not all the comments applied to both entities which have separate IT
environments and staff. We have broken out the response into two pieces and have done our best to
respond fully to the comment. We acknowledge the importance of good internal controls especially
in the area of information technology.
Water Department's Comment: The Department has addressed the IT related concerns as follows:
1) Physical Security —The Department migrated its billing and accounting applications to a new
server located in a secured office. Backups are performed daily with off-site storage updated
weekly.
2) Logical Security —The Department strengthened password settings for those systems that
allowed it by requiring users to change passwords every 90 days. In addition, unique user
ID's were issued to all ARB users.
3) Change Management —The Department implemented a reporting system to monitor all
access to the financial server by outside parties.
4) Restoration Testing —The Department is unable to conduct restoration tests due to the
absence of hardware on which to restore our applications and because recovery of the system
also requires coordination and the associated costs of the Department's software provider to
reestablish licensing.
County's Comment: The County has deployed "Tripwire", a change management software package
used to monitor and alert on access and changes to the Eden and IAS applications. Test restoration is
performed on a regular basis for the Eden application, as part of the normal testing of updates to the
system, prior to deploying those updates to the production system. As of January 2014, the
Department's new management staff was finally in place and a review of the existing policies and
procedures has begun to ensure that that they are current and to better address internal control
procedures.
Anticipated Completion Date: Some items have already been implemented, others will be
implemented by June 30, 2014 and for a few items this will be an ongoing effort as we strive to
improve our internal controls over information technology.
Contact People: Rick Sumada, Waterworks Controller
Department of Water Supply
Don Jacobs, Director of Information Technology
County of Hawaii
Page 1
Status of Prior Year Findings:
Finding 2012-01 Information Technology (Significant Deficiency)
Recommendation: We recommend that the County and the Department perform the following:
• Develop or update IT policies and procedures to include internal control procedures addressing
the IT risks above.
• Identify procedures to ensure that IT policies and procedures are consistently followed.
County's Comment: Refer to County's comment to Current Year Finding 2013-001 for status
update.
Anticipated Completion Date: Some items have already been implemented, others will be
implemented by June 30, 2014 and for a few items this will be an ongoing effort as we strive to
improve our internal controls over information technology.
Contact People: Rick Sumada, Waterworks Controller
Department of Water Supply
Don Jacobs, Director of Information Technology
County of Hawaii
Federal Award Findings:
U.S. Department of Homeland Security
Disaster Grants —Public Assistance (Presidentially Declared Disasters): Kiholo Earthquake
CFDA No. 97.036 Federal Award No.: FEMA -1664 -DR -HI
Award Period: July 1, 2008 to June 30, 2009
Finding 2009-01 Activities Allowed and Unallowed — Calculation o f Federal Expenditures
Recommendation: We recommend that the County be more cognizant of deviations in the
calculation of the federal share to ensure that the expenditures are accurately reported, including
applying the applicable guidance.
County's Comment: The County continues to strive to be more diligent in meeting its activities
allowed and unallowed requirements, including the accurate reporting of the federal expenditures.
Repairs to the facility in question have now been completed and we have received our final insurance
proceeds — the amount of which impacts the allowed federal expenditures. The County has submitted
all of the required documents pertaining to the project in question to the State Civil Defense and we
are still awaiting the final review by the Hawaii State Civil Defense in determining the final eligible
portion for federal aid.
Anticipated Completion Date: June 30, 2014
Contact Person: Kay Oshiro, Controller
County of Hawaii
Page 2