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Finance Committee Meeting
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Source page 41
TOWN OF CANTON
OPERATING EXPENSES BY VOTING CATEGORY
FUND 100 EXCLUDING ARTICLES
As of March 31 for Fiscal Years 2017 - 2018
FISCAL YEAR 2017
ORIGINAL REVISED EXPENDED YTD % OF TOTAL % OF REMAINING `% OF REVISED EXPENDED % OF
BUDGET BUDGET THRU BUDGET EXPENDED & BUDGET BUDGET BUDGET BUDGET Y-T-D BUDGET
FY 18 FY18 March 31 FY 18 ENCUM.1'TD FY 18 FY 18 F1' 18
914 EMPLOYER SHARE-HEALTH INS 12,082,117 12,090,467 9,174,880 75.9 9,174,880 7~.9 2,915,587 24.1 11,418,764 8,514,326 74.6
915 EMPLOYER SHARE-LIFE INS 60,000 60,000 49,988 83.3 49,988 83.3 10,012 16.7 60,000 44,701 74.5
946 TOWN INSURANCE 1,205,918 1,215,918 1,062,558 87.4 1,066,573 87.7 149,345 12.3 1,084,985 1,063,964 98.1
990 TRANSFERS 0 0 0 0.0 0 0.0 0 0.0 0 0 0.0
993 OPEB TRANSFER 1,000,000 1,000,000 1,000,000 100.0 1,000,000 100.0 0 0.0 770,000 770,000 100.0
TOTAL 15-Misc. Fixed 23,588,667 23,313,418 19,107,088 82.0 19,846,007 8~.1 3,467,41 1 14.9 22,012,504 17,837,528 81.0
TOTAL 02-FIXED EXPENSES 28,375,270 28,100,021 22,389,001 79.7 23,127,920 82.3 4,972,101 17.7 26,895,710 21,652,290 80.i
300 SCHOOL DEPARTMENT 40,221,559 42,867,439 28,538,953 66.6 44,057,366 102.8 (1,189,927) (2.8) 40,779,506 26,534,791 6~.1
TOTAL 17-School Admin 40,221,559 42,867,439 28,538,953 66.6 44,057,366 102.8 (1,189,927) (2.8) 40,779,506 26,534,791 65.1
TOTAL 03-SCHOOL 40,221,559 42,867,439 28,538,953 66.6 44,057,366 102.8 (1,189,927) (2.8) 40,779,506 26,534,791 65.1
820 CHERRY SHEET ASSESSMENTS 825,840 848,224 597,506 70.4 597,506 70.4 250,718 29.6 795,736 545,714 68.6
830 COUNTY TAX-CHERRY SHEET 209,009 209,009 104,504 X0.0 104,504 50.0 104,505 50.0 206,623 103,312 X0.0
TOTAL 19-State &County Chgs ],034; 49 1,057,233 702,010 66.4 702,010 66.4 355,223 33.6 1,002,359 649,026 64.7
TOTAL 05-STATE &COUNTY CHGS 1,03 ,8=d9 1,057,233 702,010 66.4 702,010 66.4 355,223 33.6 1,002,359 649,026 ~~.7
GRAND TOTALS: 89,550,74 92,512,602 66,087,753 71.=~ 82,648,774 89.3 9,563,828 10.7 88,212,273 62,340,631 7Q➢.7
W:~1VlunisuVlCR Library~Budget reports\Canton Expense Report.rpt Paje 4 of 4
Date: 4/26/2018Source page 42
TOWN OF CANTON, MASSACHUSETTS
MANAGEMENT LETTER
YEAR ENDED JUNE 30, 2017Source page 43
Table of Contents Transmittal letter...……………………………………………………. ...................1 Overview ...................................................................................................................2 Informational Items ................................................................................................ 3 - 5 Findings and Comments………………………………………………………….6 - 7
Source page 44
Board of Selectmen
Town of Canton
Canton, Massachusetts
In planning and performing our audit of the financial statements of the governmental
activities, business-type activities, each major fund, and the aggregate remaining fund
information of the Town of Canton, Massachusetts, (the “Town”) as of and for the year
ended June 30, 2017, in accordance with auditing standards generally accepted in the
United States of America, we considered the Town’s internal control over financial
reporting (internal control) as a basis for designing our auditing procedures 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 Town’s internal control. Accordingly,
we do not express an opinion on the effectiveness of the Town’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.
Our consideration of internal control over financial reporting 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 financial reporting that might be deficiencies,
significant deficiencies, or material weaknesses. We did not identify any deficiencies in
internal control over financial reporting that we consider to be material weaknesses, as
defined above.
This communication is intended solely for the information and use of management, the
Board of Selectman, and others within the organization, and is not intended to be and
should not be used by anyone other than these specified parties.
Roselli, Clark & Associates
Certified Public Accountants
Woburn, Massachusetts
November 21, 2017
Town of Canton, Massachusetts 1 of 7 Management LetterSource page 45
I. OVERVIEW
Throughout fiscal year 2017, the local, state-wide and national economies continued to
strengthen. Unemployment rates are low and property values are rising. Approximately 22%
of the Town’s property tax levy is assessed to commercial and industrial tax payers, which is
a greater percentage than most communities of its size.
The Town ended the year with approximately $16.1 million in unassigned fund balance. This
represented a $3.1 million increase over the prior year and was the seventh straight year that
the unassigned fund balanced increased by 10% over the prior year. The increase was
primarily due lower tax refunds payable of $1.4 million from the settlement of appellate tax
cases, positive budgetary results of $3.0 million, offset by the use of free cash of $2.0 million
and $0.9 million in lower planned uses of unassigned fund balances in the subsequent years’
budget. In addition, the Town added over $0.75 million to its OPEB Trust, reflecting its
commitment to funding this long-term obligation.
These results exemplified the consistency the Town maintains in managing its reserves. More
specifically, unassigned fund balances have not been below $5.1 million during any of the
past 10 years. In doing so the Town has kept a reserve ratio trending over 10% while still
being able to (1) balance its budget on an annual basis, (2) maintain significant unused levy
capacity, and (3) attend to its capital needs.
A common budgetary flexibility test used by the rating bureaus when conducting a credit
evaluation is called a reserve ratio. The ratio is calculated by adding general fund assigned
and unassigned fund balances presented in the financial statements and dividing this by the
general fund expenditures. 15% is considered tier one and 8% - 15% is considered tier two.
The Town’s ratio is 18.0% which places the Town in tier one and is considered healthy. This
metric represents 10% of the overall credit profile.
Other metrics such as the Town’s demographics, proximity to Boston and first class
Management Team are critical components of the S&P evaluation and decision to rate
Canton’s debt as AAA investment grade. The Town’s consistency and strong management
has allowed the Town to maintain this top investment grade. Maximizing the Town’s bond
rating, will minimize the cost of future borrowing for the Town.
We are encouraged by this effort and support the Town’s efforts to continue this trend into
the future. Also, on a positive note, the Town continues to improve upon its internal control
process; in part this is done through the corrective action suggested through annual
management letters. During the fiscal year the Town implemented recommendations to
strengthen its controls over cash receipts in its Board of Health Department.
The remainder of this report is intended to provide the Town and its management with
recommendations for improvement in accounting and financial operations and informational
items. The Town should review these recommendations and informational items, and, if
determined to be cost-effective, implement these improvements.
Town of Canton, Massachusetts 2 of 7 Management LetterSource page 46
II. INFORMATIONAL ITEMS
Statement on Auditing Standards No. 115 – Audit Communications
The American Institute of Certified Public Accountants (“AICPA”) recently issued Statement
on Auditing Standards No. 115, Communicating Internal Control Related Matters Identified
in an Audit (“SAS 115”). SAS 115 establishes standards and provides guidance on
communicating matters related to an entity’s internal control over financial reporting
identified in an audit of financial statements. In particular, SAS 115 provides guidance on
evaluating the severity of deficiencies in internal control identified in an audit of financial
statements in the following order:
1. Deficiency in internal control
2. Significant deficiency
3. Material weakness
Deficiencies identified as significant deficiencies or material weaknesses are required to be
communicated to those charged with governance. Deficiencies in internal control are not
required to be communicated; however we have chosen to also report these types of
deficiencies in this report.
We did not deem any of the findings in this report to be categorized as either a significant
deficiency or a material weakness.
New Financial Statement Disclosures – OPEB Part 1
The Town adopted Governmental Accounting Standards Board, or GASB, issued Statement
No. 74, Financial reporting for Postemployment Benefit Plans Other Than Pensions, in fiscal
year 2017. Other postemployment benefits is commonly referred to as “OPEB” and includes
health and welfare plans and other similar benefits provided to Town retirees exclusive of
pension benefits. The Town’s current policy is to contribute 75% of the cost of retiree health
insurance costs, plus an annual appropriation of approximately $800,000.
The adoption of this accounting standard resulted in additional disclosures within the Town’s
financial statements and the inclusion of the effects of retiree benefits paid and received (both
from the Town and its retirees) in the Town’s fiduciary funds financial statements.
FY 2018 New Accounting Principle – OPEB Part 2
As discussed in previous letters to management, the Town will be required to report the full
amount of its net OPEB liability in its government-wide and proprietary funds financial
statements in fiscal year 2018. The Town currently reports a net OPEB obligation in its
government-wide financial statements calculated under GASB 45.
The Town’s net OPEB liability is significantly greater than its net OPEB obligation. The
Town’s independent actuary determined that the Town’s net OPEB liability at June 30, 2017
was approximately $87.5 million versus a net OPEB obligation of approximately $50.7
million.
Town of Canton, Massachusetts 3 of 7 Management LetterSource page 47
The Town’s independent actuary will remeasure the Town’s net OPEB liability at June 30,
2018. The Town will present this figure in its fiscal year 2018 affected financial statements.
This will result in a further reduction in the Town’s unrestricted net position.
The Town established an OPEB trust fund several years ago and has accumulated nearly $3
million in the fund from its inception to June 30, 2017. As it stands at June 30, 2017, the
OPEB trust fund is approximately 3.3% funded.
As we have indicated in several previous letters to management, the Town should continue to
include OPEB in its long-term planning.
Changes to Single Audit Requirements – Need for Internal Control Framework
In our previous two letters to management, we notified the Town that there were a number of
changes made to single audits. One of the requirements under the new Uniform Guidance
(the successor to the OMB A-133 compliance supplement) is that all federal award recipients
are required to establish an internal control system based on a recognized internal control
framework such as the Green Book or COSO.
While the majority of the Town’s federal awards pertain to educational grants, the Town has
been the recent recipient of federal awards in other areas, particularly in public safety. Many
Massachusetts municipalities of similar size to the Town are focusing their efforts solely at
the school level, for which the MASBO provides significant guidance, including policies and
procedures templates. The proper implementation of any internal control system requires
coordination or resources between not only the Town Accountant, but the School Business
Office (the primary recipient of federal awards) and the Town Finance Director.
Documented policies and procedures, while critical to any internal control system, is but one
of a series of components to an internal control system. We recommend that the Town
evaluate the Green Book internal control system and document the Town’s compliance with
this recognized control framework. The Town should plan to complete this task during
calendar 2018.
Student Activities in the News
On November 27, 2017, the Boston Globe reported on the Boston Public Schools’ use of
student activity accounts to pay employees “under the table” and for purposes unrelated to
student activities. These violations of federal and state tax law and Massachusetts General
Laws were uncovered by an IRS audit. The Boston Globe article spotlights the need for
continued oversight of the operation of a school district’s use of student activity accounts as
well as the risks associated with their misuse. Furthermore, as these matters were made
public in the state’s most widely circulated daily newspaper, this may lead to additional rules
and regulations being issued by the Commonwealth related to student activity accounts.
We are pleased to report that the Town’s schools undergo independent reviews of their
student activity accounts in accordance with recommendations set forth by the Massachusetts
Department of Elementary and Secondary Education and the Massachusetts Association of
School Business Officials, or MASBO. In our report on the Town’s student activities dated
October 1, 2015, there were a number of areas in need of improvement at both the High
School and Middle School. The next scheduled period of independent review of the Town’s
schools is scheduled for the spring of 2018.
Town of Canton, Massachusetts 4 of 7 Management LetterSource page 48
We recommend that the Town revisit our October 1, 2015 report and ensure that progress has
been made in areas in need for improvement. Furthermore, we recommend that the Town
provide a copy of this article to all school principals and student activity administrators as a
training tool and to continue its diligence in managing this fiduciary activity.
Town of Canton, Massachusetts 5 of 7 Management LetterSource page 49
III. FINDINGS AND RECOMMENDATIONS
Employee Reimbursement Policy (repeated from prior year)
In response to prior auditor comments regarding a policy for employee reimbursements, the
Town drafted a policy for such activity. We understand that this policy has yet to be adopted
and suggest the Town follow-through with these final steps to help remove any risk
associated with this activity.
Planning Board Escrow Deposits (repeated from prior year)
Prior year audits have highlighted several issues with respect to the Planning Board
Accounts. These include payment of services when funds are not available and maintaining
deficit account balances which are the results of a lack of monitoring developers’ available
balances. While progress is ongoing we noted the same conditions existed during fiscal year
2017.
Capital Asset Maintenance
The Town Accountant’s Office maintains the Town’s capital asset detail using automated
capital asset software. We noted that there are many fully depreciated vehicles and
equipment that are maintained in the system and that are recorded on the Town’s financial
statements. We recommend that the Town Accountant review these assets with the
individual departments to determine if the assets are still in service. Those that are not should
be disposed in the asset software and assets that are still in service should be analyzed to
determine if there is a significant remaining useful life that warrants updating the system.
Recreation Department Review
In fiscal year 2017 over $350,000 was collected through the recreation revolving fund to pay
for its programs that are offered throughout the year. The Department utilizes specifically
designed software to record participation and payments for its programs. Participant rosters
and receipt reports by program are available from the system that support the funds that are
turned over to the Town Treasurer/Collector’s Office.
The Department policy is that all users must pay for programs or the use of fields up front.
The Department indicated that local field users do not always pay timely which causes the
administrative staff to spend resources making collection calls to obtain payment. The
Department staff expends significant personnel and material resources to prepare the fields
each season and require the funds timely in order to maintain them properly. The Department
should consider a late fee or other means of encouraging timely payments.
Town of Canton, Massachusetts 6 of 7 Management LetterSource page 50
We also noted that the Department charges $3 - $4 daily fees for children and adults to use
the Town pool during the summer, in addition to offering season passes. The one-day pass
users are not expected to give their information or complete the liability waivers that is
required of season pass holders. This could be a liability and safety issue should someone get
injured while at the pool. The Department should encourage visitors to complete a one-time
account sign up and waiver completion through the Department’s website so that they can be
properly checked in by staff when utilizing the pool.
Town of Canton, Massachusetts 7 of 7 Management LetterSource page 51
TOWN OF CANTON, MASSACHUSETTS
SINGLE AUDIT REPORTS
PURSUANT TO THE
UNIFORM GUIDANCE
JUNE 30, 2017Source page 52
TOWN OF CANTON, MASSACHUSETTS
TABLE OF CONTENTS
JUNE 30, 2017
Page
Independent Auditor’s 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 ...................................... 1-2
Independent Auditor’s Report on Compliance for Each Major Program and on
Internal Control Over Compliance Required by the Uniform Guidance ............................ 3-5
Schedule of Expenditures of Federal Awards .......................................................................... 6-7
Notes to Schedule of Expenditures of Federal Awards .............................................................. 8
Schedules of Findings and Questioned Costs .......................................................................... 9-10Source page 53
INDEPENDENT AUDITOR’S 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 Board of Selectmen
Town of Canton, Massachusetts
We have audited, in accordance with 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 Town of
Canton, Massachusetts, as of and for the year ended June 30, 2017, and the related notes to the financial
statements, which collectively comprise the Town of Canton, Massachusetts’s basic financial statements and
have issued our report thereon dated November 21, 2017.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the Town’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 Town’s internal control. Accordingly, we do not express
an opinion on the effectiveness of the Town’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. 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.
Town of Canton, Massachusetts 1 of 10 Uniform Guidance Single Audit ReportSource page 54
Town of Canton, Massachusetts Page Two Compliance and Other Matters As part of obtaining reasonable assurance about whether the Town’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. We noted certain other matters that we reported to management of the Town in a separate letter dated November 21, 2017. 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 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. Roselli, Clark and Associates Certified Public Accountants Woburn, Massachusetts November 21, 2017 Town of Canton, Massachusetts 2 of 10 Uniform Guidance Single Audit Report
Source page 55
INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE FOR EACH MAJOR
PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY
THE UNIFORM GUIDANCE
To the Honorable Board of Selectmen
Town of Canton, Massachusetts
Report on Compliance for Each Major Federal Program
We have audited the Town of Canton, Massachusetts’ compliance with the types of compliance
requirements described in the OMB Compliance Supplement that could have a direct and material effect
on each of the Town of Canton, Massachusetts’ major federal programs for the year ended June 30, 2017.
The Town of Canton, Massachusetts’ major federal programs are identified in the summary of auditor’s
results section of the accompanying schedule of findings and questioned costs.
Management’s Responsibility
Management is responsible for compliance with federal statutes, regulations, and the terms and conditions
of its federal awards applicable to its federal programs.
Auditor’s Responsibility
Our responsibility is to express an opinion on compliance for each of the Town of Canton, Massachusetts’
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 the 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). Those standards and the Uniform Guidance
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
Town of Canton, Massachusetts’ 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 Town of Canton,
Massachusetts’ compliance.
Opinion on Each Major Federal Programs
In our opinion, the Town of Canton, Massachusetts 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, 2017.
Town of Canton, Massachusetts 3 of 10 Uniform Guidance Single Audit ReportSource page 56
Town of Canton, Massachusetts Page Two Report on Internal Control Over Compliance Management of the Town of Canton, Massachusetts 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 Town of Canton, Massachusetts’ 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 the Uniform Guidance, 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 Town of Canton, Massachusetts’ 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 efficiencies. 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 the Uniform Guidance. Accordingly, this report is not suitable for any other purpose. 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 Town of Canton, Massachusetts, as of and for the year ended June 30, 2017, and the related notes to the financial statements, which collectively comprise the Town of Canton, Massachusetts’s basic financial statements. We have issued our report thereon dated November 21, 2017, 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 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 Town of Canton, Massachusetts 4 of 10 Uniform Guidance Single Audit Report
Source page 57
Town of Canton, Massachusetts Page Three underlying accounting and other records used to prepare the basic 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 basic financial statements as a whole. Roselli, Clark & Associates Certified Public Accountants Woburn, Massachusetts November 21, 2017 Town of Canton, Massachusetts 5 of 10 Uniform Guidance Single Audit Report
Source page 58
TOWN OF CANTON, MASSACHUSETTS
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2017
Federal Grantor / Passed
Pass-Through Grantor / CFDA Pass-Through Through to Federal
Program Title Number Number Subrecipients Expenditures
U.S. Department of Agriculture
Child Nutrition Cluster
Passed through the Commonwealth of Massachusetts -
Department of Elementary and Secondary Education
School Breakfast Program 10.553 11-050 $ - $ 47,975
National School Lunch Program: 10.555 11-050
Cash Assistance - 305,091
Non-Cash Assistance (Commodities) - 77,868
Total Child Nutrition Cluster - 430,934
U.S. Department of Justice
Direct Award
Federal Equitable Sharing Grant 16.922 - 188,354
Total U.S. Department of Justice Programs - 188,354
U.S. Department of Education
Special Education Cluster (IDEA)
Passed through the Commonwealth of Massachusetts -
Department of Elementary and Secondary Education
Special Education - Grants to States 84.027 240-101155-2017-0050 - 733,110
Special Education - Grants to States 84.027 240-012-6-0050-Q - 50,318
Special Education - Grants to States 84.027 274-095-7-0050-R - 1,920
Total Special Education - Grants to States - 785,348
Special Education - Preschool Grants 84.173 298-891-7-0050-R - 1,400
Passed through the Commonwealth of Massachusetts -
Department of Early Education and Care
Special Education - Preschool Grants 84.173 26217Cantonpublicsch - 30,484
Special Education - Preschool Grants 84.173 26216Cantonpublicsch - 1,123
Total Special Education - Preschool Grants - 31,607
Total Special Education Cluster (IDEA) - 818,355
(continued)
See notes to Schedule of Expenditures of Federal Awards
Town of Canton, Massachusetts 6 of 10 Uniform Guidance Single Audit ReportSource page 59
TOWN OF CANTON, MASSACHUSETTS
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2017
Federal Grantor / Passed
Pass-Through Grantor / CFDA Pass-Through Through to Federal
Program Title Number Number Subrecipients Expenditures
Passed through the Commonwealth of Massachusetts -
Department of Elementary and Secondary Education
Title I Grants to Local Educational Agencies 84.010 305-094029-2017-0050 - 199,741
Title I Grants to Local Educational Agencies 84.010 305-070731-2016-0050 - 13,781
Total Title I Grants to Local Educational Agencies - 213,522
Supporting Effective Instruction State Grant 84.367 140-094140-2017-0050 - 45,399
Supporting Effective Instruction State Grant 84.367 140-075294-2016-0050 - 3,994
Total Supporting Effective Instruction State Grants - 49,393
Passed through the Town of Milton, Massachusetts -
English Language Acquisition Grants 84.365 - 5,283
Total U.S. Department of Education - 1,086,553
U.S. Department of Homeland Security
Direct Award
Homeland Security Grant Program 97.067 - 1,960
Passed through the Commonwealth of Massachusetts -
Massachusetts Emergency Management Agency
Disaster Grants: Public Assistance (Presidentially Declared) 97.036 CT FEMA 4214 - 5,625
Emergency Management Performance Grants 97.042 FY17EMPG16CANTON - 3,025
Total U.S. Department of Homeland Security - 10,610
TOTAL FEDERAL GRANT EXPENDITURES $ - $ 1,716,451
(concluded)
See notes to Schedule of Expenditures of Federal Awards
Town of Canton, Massachusetts 7 of 10 Uniform Guidance Single Audit ReportSource page 60
TOWN OF CANTON, MASSACHUSETTS
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED JUNE 30, 2017
A. Basis of Presentation
The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal
award activity of the Town of Canton, Massachusetts (the Town) under programs of the federal
government for the year ended June 30, 2017. The information in this Schedule is presented in
accordance with the 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). Because the Schedule presents only a selected portion of the operations of
the Town, it is not intended to and does not present the financial position, changes in net position,
or cash flows of the Town.
B. Summary of Significant Accounting Policies
Accounting policies and financial reporting practices permitted for municipalities in
Massachusetts are prescribed by the Uniform Municipal Accounting System (UMAS)
promulgated by the Commonwealth of Massachusetts Department of Revenue.
The accompanying Schedule includes the federal grant transactions of the Town, although some
of these programs may be supplemented with state and other revenue, only federal activity is
shown. Expenditures reported on the Schedule are reported on the modified accrual basis of
accounting. Such expenditures are recognized following the cost principles contained in the
Uniform Guidance.
The Town has elected not to use the 10 percent de minimis indirect cost rate allowed under the
Uniform Guidance.
C. Non-Cash Commodities
The Town receives non-cash commodities from the U.S. Department of Agriculture as a part of
the School Lunch program. In fiscal year 2017, $77,868 was received; however, this amount is
not included in the financial statements.
Town of Canton, Massachusetts 8 of 10 Uniform Guidance Single Audit ReportSource page 61
TOWN OF CANTON, MASSACHUSETTS
SCHEDULES OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2017
A. Summary of Audit Results
1. The auditor’s report expresses an unmodified opinion on the financial statements of the Town
of Canton.
2. No significant deficiencies disclosed during the audit of the financial statements are reported
in the Independent Auditor’s 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.
3. No instances of noncompliance material to the financial statements of the Town of Canton
which would be required to be reported in accordance with Government Auditing Standards
were disclosed during the audit.
4. No reportable conditions relating to the audit of the major federal award programs are
reported in the Independent Auditor’s Report on Compliance for Each Major Program and on
Internal Control Over Compliance Required By the Uniform Guidance.
5. The auditor’s report on compliance for the major federal award programs for the Town of
Canton expresses an unmodified opinion.
6. There are no audit findings that are required to be reported in accordance with 2 CFR section
200.516(a) in this Schedule.
7. The program tested as a major program was the Child Nutrition Cluster (CFDA #10.553 &
10.555) grant program.
8. The threshold for distinguishing Types A and B programs was $750,000.
9. The Town of Canton did qualify as a low risk auditee.
B. Schedule of Findings – Financial Statements Audit
None
C. Schedule of Findings and Questioned Costs – Major Federal Award Programs Audit
None
Town of Canton, Massachusetts 9 of 10 Uniform Guidance Single Audit ReportSource page 62
TOWN OF CANTON, MASSACHUSETTS
SCHEDULES OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED JUNE 30, 2017
(Continued)
D. Summary Schedule of Prior Year Audit Findings
Finding 2016-001 - Special Education Cluster
Status: The School implemented procedures to obtain time and effort certifications on a semi-
annual basis. This finding is deemed to be closed.
Town of Canton, Massachusetts 10 of 10 Uniform Guidance Single Audit Report