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City of Santa Ana RFP No. 24‐009 Page 36 of 63 Phase 1: Risk assessment and planning The risk assessment and planning phase will encompass the overall planning stage of the single audit engagement. During this phase, we will work closely with the City’s management to determine that programs and all clusters of programs are properly identified and risk‐rated for determination of the major programs for testing. We will also review the forms and programs utilized in the prior year to determine the extent of any changes which are required. We will accomplish this by following the methodology below:  Determine the threshold to distinguish between Type A and B programs, including the effect of any loans and loan programs  Utilizing the preliminary Schedule of Expenditure of Federal Awards, we will identify the Type A and significant Type B programs (25% of Type A threshold) in accordance with the Uniform Guidance  Identify the programs tested and the findings reported for the past two fiscal years. Determine and document the program risk based on the past two single audits  Prepare and distribute Type B program questionnaires to determine risk associated with Type B programs  Determine the major programs to be tested for the current fiscal year based on the previous steps  Based on our determination of the major programs, we will obtain the current year compliance supplement to aid in the determination of direct and material compliance requirements, and customize the audit program accordingly  Determine the preferred methods of communication during the audit Phase 2: Major program testing We will determine the programs to be audited based on the risk assessment performed in the planning phase. We will perform the audit of the programs in accordance with UG. To accomplish this, we will perform the following:  Schedule an introductory meeting and notify the City’s management of the major programs for the current fiscal year  Plan and execute the testing of the expenditures reported on the Schedule of Expenditures of Federal Awards  Perform tests of compliance and internal controls over compliance for each major program identified  Schedule periodic progress meetings to determine that schedules are adhered to and identify issues as they arise  Conduct entrance and exit conference meetings with each grant manager Phase 3: Final assessment and reporting We will re‐perform the steps noted in the preliminary assessment and planning stage once the final Schedule of Expenditures of Federal Awards is received to determine if additional major programs were identified. Based on the final determination of the programs we will perform the following:  Identify Type A and significant Type B programs which were not previously identified  Re‐assess the risk and determine if we are required to audit additional programs City Council 21 – 96 5/7/2024