10/14/2010

Frequently Asked Questions concerning the municipal auditor information for the Federal Gas Tax Fund.
Audit


Our municipality will not have its auditor come in until after the March 31st deadline, should we wait to complete the Online Annual Expenditure Reporting Module?

The annual audit statement required by the Municipal Funding Agreement should be removed from the process of the annual municipal financial audit.  The two audits have different scopes. Both the annual expenditure report and annual audit statement should be completed by March 31st each year.

Is there a template for the annual audit statement?

Yes.  Click here for a sample of the annual audit statement.

Our municipal auditor would like to make changes to the annual audit statement template provided by AMO, is this acceptable?

AMO issued a sample annual audit statement at the request of a number of municipal auditors.  It is clear in indicating this is only a sample, it is the responsibility of the individual auditor to ensure it is acceptable within their scope of professional practice.  If an auditor wishes to make changes it is completely within their purview to do so.
 
What is the scope of the annual audit statement required in section 7.1 h) of the municipal funding agreement?

Click here for the scope of the annual audit statement.

Our municipal auditor is concerned that sections 3.1a, 3.1c, 3.1d, 10 within the Municipal Funding Agreement and within the scope of the compliance audit, are subjective in nature.  What is AMO’s expectation?

In all cases, AMO is looking for confirmation from the municipal auditor that the municipality undertook the action required in each of the provisions.  At no time is it expected that the auditor would provide a subjective opinion such as the adequacy of the action.

What are the tests that should be applied to a project when demonstrating incrementality?

When using the federal gas tax revenue for a project, one of the three following conditions must be met: enabled a project’s implementation; enhanced a project’s scope or accelerated a project’s timing.
 
Section 6.9 of the Municipal Funding Agreement seems contrary to the incrementality principle.  If a project was eligible for other federal funding, can it still be incremental?

All federal capital programs require incrementality.  If a project has met the test of incrementality under another funding program it has also met the test under the federal gas tax.

Our municipality did not spend any of the Federal Gas Tax money this year, do we need to complete online reporting and submit an annual audit statement?

Completing the Online Annual Expenditure Reporting Module is required every year even when there are no expenditures. 

The Amendment to the Federal Gas Tax Agreement has introduced some flexibility in the annual audit statement requirement for municipalities.  If there are no eligible costs applied to an eligible project in a municipal fiscal year, the municipality is only required to have the Municipal Treasurer submit the Treasurer’s Certificate no need for an annual audit statement.  The Municipal Auditor has no role in either the submission of the online reporting or Municipal Treasurer’s Certificate in that particular fiscal year.  Both the online reporting and Municipal Treasurer’s Certificate are due March 31 and must be received before a municipality is put in the queue for payment.

Updated: October 14, 2010