Report 2017-113 Recommendation 3 Responses

Report 2017-113: South Orange County Wastewater Authority: It Should Continue to Improve Its Accounting of Member Agencies' Funds and Determine Whether Members Are Responsible for Its Unfunded Liabilities (Release Date: March 2018)

Recommendation #3 To: South Orange County Wastewater Authority

SOCWA should finish investigating the difference in available cash balances per its audited financial statements and its accounting records, and then develop a methodology that is agreeable to its members for allocating any additional cash it identifies to the credit of its members. For example, it could allocate this money to members based on each member's existing proportion of available cash per SOCWA's accounting records.

1-Year Agency Response

The SOCWA Board Directors approved a methodology for distribution of additional Cash balances accumulated to June 30, 2018. Documentation provided via email includes distribution methodology and actual distribution to member agencies based on project committee/member share. This work occurred with the annual Use Audit preparation and subsequent reporting of Supplemental Financial Statements.

California State Auditor's Assessment of 1-Year Status: Fully Implemented

6-Month Agency Response

Monthly financial updates will be provided to the Finance Committee starting October 2018. Included in the submittal is the presentation the Finance Controller provided to the Finance Committee on 9/19/2018 related to the cash roll forward for FY 2017/18.

California State Auditor's Assessment of 6-Month Status: Pending

60-Day Agency Response

Preparing a report of the differences in existing cash and working with the Finance Committee to develop a methodology that is agreeable to our member agencies. The SOCWA Board will consider an allocation based on existing proportion to available cash.

California State Auditor's Assessment of 60-Day Status: Pending

All Recommendations in 2017-113

Agency responses received are posted verbatim.