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CITY OF SALEM, MASSACHUSETTS REPORTS ON FEDERAL AWARD PROGRAMS YEAR ENDED JUNE 30, 2019 ---PAGE BREAK--- CITY OF SALEM, MASSACHUSETTS REPORTS ON FEDERAL AWARD PROGRAMS YEAR ENDED JUNE 30, 2019 TABLE OF CONTENTS Page 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 Report on compliance for each major federal program and report on internal control over compliance required by the Uniform Guidance 3 Report on schedule of expenditures of federal awards required by the Uniform Guidance 5 Schedule of expenditures of federal awards 6 Notes to schedule of expenditures of federal awards 9 Schedule of findings and questioned costs 10 ---PAGE BREAK--- 1 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 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 Independent Auditor’s Report To the Honorable Mayor and members of the City Council City of Salem, Massachusetts 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, each major fund, and the aggregate remaining fund information of the City of Salem, Massachusetts, as of and for the year ended June 30, 2019, and the related notes to the financial statements, which collectively comprise the City of Salem, Massachusetts’ basic financial statements, and have issued our report thereon dated January 28, 2020. Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered the City of Salem, Massachusetts’ 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 City of Salem, Massachusetts’ internal control. Accordingly, we do not express an opinion on the effectiveness of the City of Salem, Massachusetts’ 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 City’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. ---PAGE BREAK--- 2 Compliance and Other Matters As part of obtaining reasonable assurance about whether the City of Salem, Massachusetts’ 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. 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 City’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 City’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. January 28, 2020 ---PAGE BREAK--- 3 Report on compliance for each major federal program and report on internal control over compliance required by the Uniform Guidance REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM AND REPORT ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE Independent Auditor’s Report To the Honorable Mayor and Members of the City Council City of Salem, Massachusetts Report on Compliance for Each Major Federal Program We have audited the City of Salem, 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 City of Salem, Massachusetts’ major federal programs for the year ended June 30, 2019. The City of Salem, 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 City of Salem, 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 City of Salem, 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 City of Salem, Massachusetts’ compliance. ---PAGE BREAK--- 4 Opinion on Each Major Federal Program In our opinion, the City of Salem, 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, 2019. Report on Internal Control Over Compliance Management of the City of Salem, 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 City of Salem, 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 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 City of Salem, 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 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 Uniform Guidance. Accordingly, this report is not suitable for any other purpose. March 9, 2020 ---PAGE BREAK--- 5 Report on schedule of expenditures of federal awards required by the Uniform Guidance REPORT ON SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS REQUIRED BY THE UNIFORM GUIDANCE Independent Auditor’s Report To the Honorable Mayor and Members of the City Council City of Salem, Massachusetts 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 City of Salem, Massachusetts, as of the year ended June 30, 2019, and the related notes to the financial statements, which collectively comprise the City of Salem, Massachusetts’ basic financial statements. We issued our report thereon dated January 28, 2020, 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 required part of the basic financial statements. 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 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. January 28, 2020 ---PAGE BREAK--- Federal Pass-Through Amount Passed CFDA Entity Identifying Through to Federal Grantor/Pass-Through Grantor/Program or Cluster Title Number Number Sub-Recipients Expenditures CHILD NUTRITION CLUSTER: U.S. DEPARTMENT OF AGRICULTURE: Passed through Massachusetts Department of Elementary and Secondary Education: Non-Cash Assistance (Commodities): National School Lunch 10.555 05-258 $ - $ 189,347 Cash Assistance: National School Lunch 10.555 05-258 - 1,528,016 After School Snack 10.555 05-258 - 5,237 Total National School Lunch - 1,722,600 Cash Assistance: School Breakfast 10.553 05-258 - 667,266 TOTAL CHILD NUTRITION - 2,389,866 EMPLOYMENT SERVICE CLUSTER: U.S. DEPARTMENT OF LABOR: Passed through State Division of Career Services - Workforce Development: Employment Service/Wagner Peyser Funded Activities (Fiscal year 17.207 19CCSALEWP-WP 19 - 52,368 Employment Service/Wagner Peyser Funded Activities (Fiscal year 17.207 18CCSALEWP-WP 18 - 18,211 Total Employment Service/Wagner Peyser Funded Activities…………………………………… - 70,579 Disabled Veterans' Outreach Program (DVOP) (Fiscal year 17.801 19CCSALEVETSUI-VETS 19 - 28,714 TOTAL EMPLOYMENT SERVICE - 99,293 WORKFOCE INNOVATION AND OPPORTUNITY ACT (WIOA) CLUSTER: U.S. DEPARTMENT OF LABOR: Passed through State Division of Career Services - Workforce Development: WIOA - Adult Program (Fiscal Year 17.258 CT EOL 19CCSALEWIA - 331,410 WIOA - Adult Program (Fiscal Year 17.258 CT EOL 18CCSALEWIA - 245,417 Total WIOA - Adult - 576,827 WIOA - Youth Activities (Fiscal Year 17.259 CT EOL 19CCSALEWIA 235,558 464,345 WIOA - Youth Activities (Fiscal Year 17.259 CT EOL 18CCSALEWIA - 153,568 Total WIOA - Youth 235,558 617,913 WIOA - Dislocated Worker Formula Grants (Fiscal Year 17.278 CT EOL 19CCSALEWIA - 246,830 WIOA - Dislocated Worker Formula Grants (Fiscal Year 17.278 CT EOL 18CCSALEWIA - 252,289 WIOA - Dislocated Worker Formula Grants (Fiscal Year 17.278 18CCSALEWIA-RRSS - 64,369 Total WIOA - Dislocated Worker Formula - 563,488 TOTAL WORKFORCE INNOVATION AND OPPORTUNITY ACT CLUSTER……………………… 235,558 1,758,228 SPECIAL EDUCATION CLUSTER: U.S. DEPARTMENT OF EDUCATION: Passed through Massachusetts Department of Elementary and Secondary Education: Special Education Grants to States (IDEA, Part B) (Fiscal Year 84.027 240-[PHONE REDACTED]-0258 - 1,034,290 Special Education Grants to States (IDEA, Part B) (Fiscal Year 84.027 240-[PHONE REDACTED]-0258 - 158,494 Special Education Grants to States (IDEA, Part B) (Fiscal Year 84.027 274-[PHONE REDACTED]-0258 - 9,051 Special Education Grants to States (IDEA, Part B) (Fiscal Year 84.027 248-[PHONE REDACTED]-0258 - 22,500 Special Education Grants to States (IDEA, Part B) (Fiscal Year 84.027 240-[PHONE REDACTED]-0258 - 69 Total Special Education Grants to States (IDEA, Part - 1,224,404 Special Education Preschool Grants (Fiscal Year 84.173 262-[PHONE REDACTED]-0258 - 47,461 Special Education Preschool Grants (Fiscal Year 84.173 26218SALEMPUBLICPAY - 834 Special Education Preschool Grants (Fiscal Year 84.173 26217SALEMPUBLICPAY - 5,900 Total Special Education Preschool - 54,195 TOTAL SPECIAL EDUCATION - 1,278,599 AGING CLUSTER: U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES: Passed through North Shore Elder Services, Inc.: Special Programs for the Aging Title III, Part B Grants for Supportive Services and Senior 93.044 15COA258000000002015 - 10,880 Special Programs for the Aging Title III, Part C Nutrition 93.045 15COA258000000002015 - 15,927 TOTAL AGING - 26,807 DIRECT PROGRAMS: U.S. DEPARTMENT OF DEFENSE: Direct Program: ROTC Language and Culture Training 12.357 N/A - 94,421 (Continued) SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED JUNE 30, 2019 City of Salem, Massachusetts 6 Report on Federal Award Programs ---PAGE BREAK--- Federal Pass-Through Amount Passed CFDA Entity Identifying Through to Federal Grantor/Pass-Through Grantor/Program or Cluster Title Number Number Sub-Recipients Expenditures SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED JUNE 30, 2019 U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT: Direct Program: Community Development Block Grant/Entitlement 14.218 N/A 250,173 1,114,382 U.S. DEPARTMENT OF JUSTICE: Direct Program: Grants to Encourage Arrest Policies and Enforcement of Protection 16.590 N/A - 112,059 Local Law Enforcement Trust Funds 16.592 N/A - 42,168 Bulletproof Vest Partnership 16.607 N/A - 46,753 Public Safety Partnership and Community Policing 16.710 N/A - 116,587 TOTAL U.S. DEPARTMENT OF - 317,567 U.S. ENVIROMENTAL PROTECTION AGENCY: Direct Program: Brownfield Assessment & Cooperative Cleanup 66.818 N/A - 6,835 U.S. DEPARTMENT OF HOMELAND SECURITY: Direct Program: Port Security Grant 97.056 N/A - 24,579 PASS-THROUGH PROGRAMS: U.S. DEPARTMENT OF AGRICULTURE: Passed through Massachusetts Department of Elementary and Secondary Education: Fresh Fruit and Vegetable Program (Fiscal Year 10.582 05-258 - 59,638 Fresh Fruit and Vegetable Program (Fiscal Year 10.582 05-258 - 384 Total Fresh Fruit and Vegetable - 60,022 U.S. FISH AND WILDLIFE SERVICE: Passed though Massachusetts Divison of Marine Fisheries Clean Vessel 15.616 CVA REIMBURSEMENT - 8,974 U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT: Passed through Massachusetts Office for Communities and Development: Home Investment Partnership 14.239 25503-5711-5713 - 316,425 U.S. DEPARTMENT OF THE INTERIOR: Passed through the Massachusetts Historical Commission: Historic Preservation Fund 15.904 25F41-4580 - 5,342 U.S. DEPARTMENT OF JUSTICE: Passed through Massachusetts Office of Public Safety and Homeland Security: Edward Byrne Memorial Justice Assistance Grant 16.738 N/A - 18,904 U.S. DEPARTMENT OF LABOR: Passed through State Division of Career Services - Workforce Development: Unemployment 17.225 17CCSALENEGREA-REA8-18 - 53,380 Trade Adjustment Assistance (Fiscal Year 17.245 CT EOL 19CCSALETRADE - 2,661 Trade Adjustment Assistance (Fiscal Year 17.245 18CCSALETRADE-TAA-CM18 - 20,940 Trade Adjustment Assistance (Fiscal Year 17.245 16CCSALETRADE-TAA-CM17 - 17,877 Total Trade Adjustment - 41,478 H-1b Job Training 17.268 16CCSALENEGREA-APPR 17 99,343 288,606 Workforce Investment Act - National Emergency 17.277 19CCSALENEGREA-GNEG 19 - 97,604 Apprenticeship USA Grants (Fiscal Year 17.285 19CCSALENEGREA-APPRC 19 14,400 46,497 Apprenticeship USA Grants (Fiscal Year 17.285 17CCSALENEGREA-APPEXP 18 12,800 123,408 Total Apprenticeship USA 27,200 169,905 TOTAL U.S. DEPARTMENT OF 126,543 650,973 U.S. DEPARTMENT OF EDUCATION: Passed through State Division of Career Services - Workforce Development: Adult Basic Education - Basic Grants to States 84.002 19CCSALEWP-W-PRTN 19-01 - 4,371 Passed through Massachusetts Department of Elementary and Secondary Education: Title I Grants to Local Educational Agencies (Fiscal Year 84.010 305-[PHONE REDACTED]-0258 - 848,243 Title I Grants to Local Educational Agencies (Fiscal Year 84.010 305-[PHONE REDACTED]-0258 - 255,798 Title I Grants to Local Educational Agencies (Fiscal Year 84.010 323-[PHONE REDACTED]-0258 - 25,349 Title I Grants to Local Educational Agencies (Fiscal Year 84.010 305-[PHONE REDACTED]-0258 - 12,720 Total Title I Grants to Local Educational - 1,142,110 Career and Technical Education Basic Grants to States (Fiscal Year 84.048 400-[PHONE REDACTED]-0258 - 49,801 Career and Technical Education Basic Grants to States (Fiscal Year 84.048 400-[PHONE REDACTED]-0258 - 18,621 Total Career and Technical Education Basic Grants to - 68,422 Education for Homeless Children and Youth (Fiscal Year 84.196 310-[PHONE REDACTED]-0258 - 4,556 Education for Homeless Children and Youth (Fiscal Year 84.196 310-[PHONE REDACTED]-0258 - 22,552 Total Education for Homeless Children and - 27,108 (Continued) City of Salem, Massachusetts 7 Report on Federal Award Programs ---PAGE BREAK--- Federal Pass-Through Amount Passed CFDA Entity Identifying Through to Federal Grantor/Pass-Through Grantor/Program or Cluster Title Number Number Sub-Recipients Expenditures SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED JUNE 30, 2019 Twenty-First Century Community Learning Centers (Fiscal Year 84.287 645-[PHONE REDACTED]-0258 - 253,594 Twenty-First Century Community Learning Centers (Fiscal Year 84.287 646-[PHONE REDACTED]-0258 - 51,163 Twenty-First Century Community Learning Centers (Fiscal Year 84.287 644-[PHONE REDACTED]-0258 - 36,000 Twenty-First Century Community Learning Centers (Fiscal Year 84.287 244-[PHONE REDACTED]-0258 - 5,820 Twenty-First Century Community Learning Centers (Fiscal Year 84.287 645-[PHONE REDACTED]-0258 - 66,987 Total Twenty-First Century Community Learning - 413,564 English Language Acquisition Grants (Fiscal Year 84.365 180-[PHONE REDACTED]-0258 - 12,523 English Language Acquisition Grants (Fiscal Year 84.365 180-[PHONE REDACTED]-0258 - 51,748 English Language Acquisition Grants (Fiscal Year 84.365 180-[PHONE REDACTED]-0258 - 525 Total English Language Acquisition - 64,796 Mathematics and Science 84.366 145-[PHONE REDACTED]-0258 - 6,949 Supporting Effective Instruction State Grants (Fiscal Year 84.367 140-[PHONE REDACTED]-0258 - 7,533 Supporting Effective Instruction State Grants (Fiscal Year 84.367 140-[PHONE REDACTED]-0258 - 148,266 Supporting Effective Instruction State Grants (Fiscal Year 84.367 144-[PHONE REDACTED]-0258 - 1,051 Supporting Effective Instruction State Grants (Fiscal Year 84.367 140-[PHONE REDACTED]-0258 - 19,114 Total Supporting Effective Instruction State - 175,964 Student Support and Academic Enrichment (Fiscal Year 84.424 309-[PHONE REDACTED]-0258 - 13,295 Student Support and Academic Enrichment (Fiscal Year 84.424 309-[PHONE REDACTED]-0258 - 22,562 Total Student Support and Academic - 35,857 TOTAL U.S. DEPARTMENT OF - 1,939,141 U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES: Passed through Center for Disease Control and Prevention: Cooperative Agreements to Promote Adolescent Health Through School Based 93.079 649-[PHONE REDACTED]-0258 - 143 Passed through Massachusetts Department of Elementary and Secondary Education: Teenage Pregnancy Prevention Program (Fiscal Year 93.297 716-[PHONE REDACTED]-0258 - 24,000 Teenage Pregnancy Prevention Program (Fiscal Year 93.297 716-[PHONE REDACTED]-0258 - 3,351 Total Teenage Pregnancy Prevention - 27,351 Improving Student Health and Academic 93.981 650-[PHONE REDACTED]-0258 - 4,800 TOTAL U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES……………………………. - 32,294 U.S. DEPARTMENT OF HOMELAND SECURITY: Passed through Massachusetts Emergency Management Agency: Hazard Mitigation Grant 97.039 HMGP189516-SPRING - 9,485 Emergency Management Performance 97.042 FY19EMPG1800000SALEM - 13,760 TOTAL U.S. DEPARTMENT OF HOMELAND - 23,245 $ 612,274 $ 10,165,897 See notes to schedule of expenditures of federal awards. (Concluded) City of Salem, Massachusetts 8 Report on Federal Award Programs ---PAGE BREAK--- Notes to Schedule of Expenditures of Federal Awards Year Ended June 30, 2019 City of Salem, Massachusetts 9 Report on Federal Award Programs Note 1 – Basis of Presentation Notes to schedule of expenditures of federal awards The accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal award activity of the City of Salem, Massachusetts under programs of the federal government for the year ended June 30, 2019. 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 City of Salem, Massachusetts, it is not intended to and does not present the financial position, changes in net position, or cash flows of the City of Salem, Massachusetts. Note 2 – Summary of Significant Accounting Policies The accounting and reporting policies of the City of Salem, Massachusetts are set forth below: a) Basis of Accounting – The accompanying Schedule of Expenditures of Federal Awards is presented on the modified accrual basis of accounting. Accordingly, expenditures are recognized when the liability is incurred. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. b) Cash Assistance – School Breakfast and National School Lunch Programs – Program expenditures represent federal reimbursement for meals provided during the year. c) Non-Cash Assistance (Commodities) – National School Lunch Program – Program expenditures represent the value of donated foods received during the year. d) The City of Salem, Massachusetts has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. ---PAGE BREAK--- Schedule of Findings and Questioned Costs Year Ended June 30, 2019 City of Salem, Massachusetts 10 Report on Federal Award Programs A. Summary of Auditor’s Results Schedule of findings and questioned costs 1. The auditor’s report expresses an unmodified opinion on the financial statements of the City of Salem, Massachusetts. 2. No material weaknesses or significant deficiencies relating to the audit of the basic financial statements are reported in the 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 City of Salem, Massachusetts were disclosed during the audit. 4. No material weaknesses or significant deficiencies relating to the audit of the major federal award programs are reported in the Report on Compliance for Each Major Federal Program; Report on Internal Control over Compliance; and Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance. 5. The auditor’s report on compliance for the major federal award programs for the City of Salem, Massachusetts expresses an unmodified opinion on all major federal award programs. 6. There were no audit findings relative to the major federal award programs for the City of Salem, Massachusetts. 7. The programs tested as major grants are the Child Nutrition Cluster CFDA #10.553 and 10.555 and Community Development Block Grant CFDA #14.218. 8. The threshold for distinguishing Types A and B programs was $750,000. 9. The City of Salem, Massachusetts was determined to be a low-risk auditee. B. Findings-Financial Statements Audit None. C. Findings and Questioned Costs-Major Federal Award Programs None. D. Summary Schedule of Prior Audit Findings None.