Numbered findings
14
Control and compliance issues in the report
Independent municipal audit · CY2016
14 control and compliance findings.
Here is what they mean.
The financial statements received a clean regulatory-basis opinion, but recurring HUD reconciliations remained a material weakness and four HUD programs had qualified compliance opinions.
At a glance
Material weaknesses
1
The highest financial-reporting control category
Repeat findings
4
Issues reported in at least one earlier audit
Opinion scope
See report opinion
Opinion scope varies by report year and accounting basis
The opinion is not a pass/fail grade
Most regulatory statements received clean opinions—with an important exception.
Unmodified regulatory-basis opinion; qualified compliance opinions for CDBG, ESG, HOME, and HOPWA; adverse GAAP-basis opinion.
Read the three opinion scopes
- New Jersey regulatory basis: Unmodified.
- U.S. GAAP: Adverse because the mandated regulatory basis differs from GAAP.
- Fixed assets: None
Every numbered finding
What needs to change
“Material weakness” is an audit-control classification, not an allegation of fraud. Open a finding for the condition, why it matters, the auditor's recommendation, repeat history, and the City's separately labeled response.
2016-001 · noncompliance material to basic financial statements
· Repeat since 2012
Aged unfunded capital costs
Unfinanced costs totaling $14,753,128 for capital projects over five years old remained on the City's books, including $11,704,212 for general, $1,587,258 for school, and $1,461,658 for water projects.
2016-001 · noncompliance material to basic financial statements
· Repeat since 2012
Aged unfunded capital costs
Unfinanced costs totaling $14,753,128 for capital projects over five years old remained on the City's books, including $11,704,212 for general, $1,587,258 for school, and $1,461,658 for water projects.
Why it matters
The aged balances created cash-flow concerns and did not comply with State capital-funding requirements.
Auditor recommendation
Fund all Unfunded Deferred Charges to Future Taxation and Water Rents over five years old for which unfinanced costs have been paid.
City response · unaudited
The City stated that it would continue working to fund all unfunded projects.
Official report p. 284 · Includes a compliance issue
2016-002 · significant deficiency
· Repeat since 2013
Fixed-asset inventory and authority assets
The inventory had unlocatable or disposed assets, no disposals recorded for two years, missing VINs for 182 of 820 vehicles, and omitted machinery and equipment inherited from the dissolved Parking and Incinerator Authorities.
2016-002 · significant deficiency
· Repeat since 2013
Fixed-asset inventory and authority assets
The inventory had unlocatable or disposed assets, no disposals recorded for two years, missing VINs for 182 of 820 vehicles, and omitted machinery and equipment inherited from the dissolved Parking and Incinerator Authorities.
Why it matters
The inventory did not comply with N.J.A.C. 5:30-5.6 and could become materially misstated and unreliable.
Auditor recommendation
Make every asset traceable, enforce disposal and transfer procedures, and add all assets inherited from the dissolved authorities.
City response · unaudited
The City stated that it assigned a Fixed Asset Manager and hired an appraisal company to update the inventory and enforce disposal and transfer policies.
Official report pp. 285–286 · Includes a compliance issue
2016-003 · material weakness
· Repeat since 2011
HUD grant reconciliations and reporting
CDBG, HOME, HOPWA, and ESG receivable and reserve balances were not reconciled to IDIS, subsidiary ledgers, and related reports, and HOME receipts could not be reconciled.
2016-003 · material weakness
· Repeat since 2011
HUD grant reconciliations and reporting
CDBG, HOME, HOPWA, and ESG receivable and reserve balances were not reconciled to IDIS, subsidiary ledgers, and related reports, and HOME receipts could not be reconciled.
Why it matters
Grant balances and disbursements could not be validated or traced to HUD records.
Auditor recommendation
Adopt monthly reporting, reconciliation, and closing procedures for CDBG, HOME, HOPWA, and ESG records.
Questioned costs: None noted.
City response · unaudited
The City stated that the CFO assigned an individual to reconcile IDIS with the City's FOW system and that monthly reporting, reconciliation, and closing procedures would be established.
Official report pp. 287–289 · Includes a compliance issue
2016-004 · compliance finding
CDBG timeliness ratio exceeded
The City's unexpended CDBG balance was 1.6 times its annual grant, above the 1.5 limit in 24 CFR 570.902.
2016-004 · compliance finding
CDBG timeliness ratio exceeded
The City's unexpended CDBG balance was 1.6 times its annual grant, above the 1.5 limit in 24 CFR 570.902.
Why it matters
Continued noncompliance could reduce a future grant by the excess, which was $626,925 for Program Year 2015.
Auditor recommendation
Expend CDBG funding more promptly.
Questioned costs: None noted; continued noncompliance could result in loss of funding.
City response · unaudited
The City stated that it would work with CDBG to ensure funds were spent on time.
Official report pp. 289–290 · Includes a compliance issue
2016-005 · compliance finding
· Repeat since 2014
Purchases exceeding bid threshold
Five of 60 sampled purchases involved vendors paid above the bid threshold without public bidding or a documented Local Public Contracts Law exception.
2016-005 · compliance finding
· Repeat since 2014
Purchases exceeding bid threshold
Five of 60 sampled purchases involved vendors paid above the bid threshold without public bidding or a documented Local Public Contracts Law exception.
Why it matters
The report does not state a separate effect.
Auditor recommendation
Monitor aggregate vendor payments and advertise publicly when expected payments reach bid thresholds.
Official report p. 297 · Includes a compliance issue
2016-006 · control deficiency
Parking-receipt reconciliation
Parking Enforcement receipts were not regularly reconciled to Treasury remittances; departmental records were $89,351 below Treasury receipts, and $8,083 of November 2015 meter-coin bag money could not be located and was written off.
2016-006 · control deficiency
Parking-receipt reconciliation
Parking Enforcement receipts were not regularly reconciled to Treasury remittances; departmental records were $89,351 below Treasury receipts, and $8,083 of November 2015 meter-coin bag money could not be located and was written off.
Why it matters
The report does not state a separate effect.
Auditor recommendation
Regularly reconcile Parking Enforcement receipts to amounts remitted to Treasury and deposited.
Official report pp. 297–298
2016-007 · control deficiency
Elevator inventory and fee-collection backlog
Elevator-inspection fee collections had a significant backlog, and the master inventory of billable elevators had not been updated in more than five years despite substantial construction.
2016-007 · control deficiency
Elevator inventory and fee-collection backlog
Elevator-inspection fee collections had a significant backlog, and the master inventory of billable elevators had not been updated in more than five years despite substantial construction.
Why it matters
The report does not state a separate effect.
Auditor recommendation
Update the elevator inventory, bill inspections promptly, reconcile unpaid prior-year bills, and pursue collection.
Official report p. 298
2016-008 · compliance finding
Severance spending without appropriation
The City spent $6,738,978 on contractual severance liabilities without a legal appropriation, violating N.J.S.A. 40A:4-57.
2016-008 · compliance finding
Severance spending without appropriation
The City spent $6,738,978 on contractual severance liabilities without a legal appropriation, violating N.J.S.A. 40A:4-57.
Why it matters
The report does not state a separate effect.
Auditor recommendation
Raise the unappropriated expenditure in the succeeding year's budget.
Official report p. 298 · Includes a compliance issue
2016-009 · control deficiency
Grant-receipt posting and subsidiary ledger
Grant receipts were posted to incorrect grant lines, and the grants-receivable subsidiary ledger was maintained offline rather than integrated with the accounting system.
2016-009 · control deficiency
Grant-receipt posting and subsidiary ledger
Grant receipts were posted to incorrect grant lines, and the grants-receivable subsidiary ledger was maintained offline rather than integrated with the accounting system.
Why it matters
The report does not state a separate effect.
Auditor recommendation
Post receipts to correct grants and grant years, coordinate reimbursements with Accounts and Control, and consider integrating the grants-receivable subsidiary ledger.
Official report p. 298
2016-010 · control deficiency
Untimely bank reconciliations
Not all City bank reconciliations were prepared promptly, resulting in post-closing adjustments several months into the next fiscal year.
2016-010 · control deficiency
Untimely bank reconciliations
Not all City bank reconciliations were prepared promptly, resulting in post-closing adjustments several months into the next fiscal year.
Why it matters
The report does not state a separate effect.
Auditor recommendation
Reconcile every bank account within a reasonable period after fiscal year end.
Official report p. 299
2016-011 · compliance finding
Unapproved petty-cash custodians
Six petty-cash custodians lacked evidence of approval by City resolution and the Director of the Division of Local Government Services as required by N.J.S.A. 40A:5-21.
2016-011 · compliance finding
Unapproved petty-cash custodians
Six petty-cash custodians lacked evidence of approval by City resolution and the Director of the Division of Local Government Services as required by N.J.S.A. 40A:5-21.
Why it matters
The report does not state a separate effect.
Auditor recommendation
Adopt resolutions for unapproved custodians and forward them to the Division director for approval.
Official report p. 299 · Includes a compliance issue
2016-012 · control deficiency
Overtime authorization reconciliation
Overtime authorizations were not always reconciled to time-tracking records before payment or promptly afterward.
2016-012 · control deficiency
Overtime authorization reconciliation
Overtime authorizations were not always reconciled to time-tracking records before payment or promptly afterward.
Why it matters
The report does not state a separate effect.
Auditor recommendation
Reconcile overtime authorizations to time records before payment or promptly afterward when the Fair Labor Standards Act requires payment first.
Official report p. 299
2016-013 · fraud-related finding
Off-duty police employment investigation
The FBI investigated alleged schemes involving off-duty police assignments in the City's dedicated rider program, and seven current or former officers had pleaded guilty or admitted fraudulent activity.
2016-013 · fraud-related finding
Off-duty police employment investigation
The FBI investigated alleged schemes involving off-duty police assignments in the City's dedicated rider program, and seven current or former officers had pleaded guilty or admitted fraudulent activity.
Why it matters
The report does not state a separate effect.
Auditor recommendation
Defer the matter to due legal process.
Official report pp. 299–300 · Includes a compliance issue
2016-014 · control deficiency
Municipal Court ticket backlog
The December 2016 Municipal Court management report showed substantial backlogs across dismissal, suspension, warrant, aged-case, and assigned-but-not-issued ticket categories.
2016-014 · control deficiency
Municipal Court ticket backlog
The December 2016 Municipal Court management report showed substantial backlogs across dismissal, suspension, warrant, aged-case, and assigned-but-not-issued ticket categories.
Why it matters
The report does not state a separate effect.
Auditor recommendation
Review the tickets, determine their disposition, and remove resolved items from the Automated Traffic System.
Official report p. 300
Historical audits
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CY is a calendar year, FY is the older June-ending fiscal year, and TY2010 is the transition period. Comparative CY2022 also represents CY2021.
Official PDF archive
Supporting source evidence, not the primary reading experience. Independent audits only; budgets and Annual Financial Statements are separate.
| Report | Years covered | Source |
|---|---|---|
| CY2025 | 2025, 2024 | Open official PDF |
| CY2024 | 2024, 2023 | Open official PDF |
| CY2023 | 2023, 2022 | Open official PDF |
| CY2022 |
2022, 2021
No separate CY2021 report was published; this comparative audit covers both 2022 and 2021.
|
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| CY2020 | 2020, 2019 | Open official PDF |
| CY2019 | 2019, 2018 | Open official PDF |
| CY2018 | 2018, 2017 | Open official PDF |
| CY2017 | 2017, 2016 | Open official PDF |
| CY2016 | 2016, 2015 | Open official PDF |
| CY2015 | 2015, 2014 | Open official PDF |
| CY2014 | 2014, 2013 | Open official PDF |
| CY2013 | 2013, 2012 | Open official PDF |
| CY2012 | 2012, 2011 | Open official PDF |
| CY2011 |
2011, 2010
This report covers CY2011 and the 2010 transition year.
|
Open official PDF |
| TY2010 |
2010
Transition-year report for the period ending December 31, 2010; it also compares the fiscal year ending June 30, 2010.
|
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| FY2010 | 2010 | Open official PDF |
| FY2009 | 2009 | Open official PDF |
| FY2008 | 2008 | Open official PDF |
| FY2007 | 2007 | Open official PDF |
| FY2006 | 2006 | Open official PDF |
Project Solomon is independent of the City of Jersey City. Structured audit facts are manually source-checked; City management responses are unaudited.