CIty of Long Beach

CITY OF LONG BEACH Audit Report DOMESTIC VIOLENCE ARREST POLICIES AND STANDARDS PROGRAM Chapter 246, Statutes of 1995 July 1, 2019, through June 30, 2023 M M. C ALIA OHEN C ALIFORNIA S TATE C ONTROLLER September 2025 MALIA M. COHEN CALIFORNIA STATE CONTROLLER September 2, 2025 CERTIFIED MAIL—RETURN RECEIPT REQUESTED Mr. Kevin Riper, Director Financial Management Department City of Long Beach 411 West Ocean Boulevard Long Beach, CA 90802 Dear Director Riper: The State Controller’s Office audited the costs claimed by the City of Long Beach (the city) for the legislatively mandated Domestic Violence Arrest Policies and Standards Program for the period of July 1, 2019, through June 30, 2023. The city claimed and was paid $465,699 for costs of the mandated program. Our audit found that $409,118 is allowable and $56,581 is unallowable. The costs are unallowable because the city overstated salary and benefit costs, and related indirect costs. Following issuance of this report, the Local Government Programs and Services Division of the State Controller’s Office will notify the city of the adjustment to its claims via a system- generated letter for each fiscal year in the audit period. If you have any questions regarding this report, please contact Lisa Kurokawa, Chief, Compliance Audits Bureau, by telephone at 916-327-3138. Thank you. Sincerely, Original signed by Kimberly A. Tarvin, CPA Chief, Division of Audits KAT/am . MAILING ADDRESS P.O. Box 942850, Sacramento, CA 94250 SACRAMENTO 3301 C Street, Suite 700, Sacramento, CA 95816 | 916.324.8907 LOS ANGELES 901 Corporate Center Drive, Suite 200, Monterey Park, CA 91754 | 323.981.6802 Mr. Kevin Riper September 2, 2025 Page 2 of 2 Copy: The Honorable Rex Richardson, Mayor City of Long Beach Shawna Stevens, Chief of Staff City of Long Beach Christian Cambridge, Financial Services Officer City of Long Beach Rebecca Bernstorff, Budget Manager Financial Management Department City of Long Beach Geraldine Alejo, Revenue Management Officer Financial Management Department City of Long Beach Wally Hebeish, Chief Long Beach Police Department Julissa Jose-Murray, Chief Business Operations Bureau Long Beach Police Department Chris Hill, Principal Program Budget Analyst Local Government Unit California Department of Finance Kaily Yap, Finance Budget Analyst Local Government Unit California Department of Finance Darryl Mar, Manager Local Reimbursements Section State Controller’s Office Everett Luc, Supervisor Local Reimbursements Section State Controller’s Office MAILING ADDRESS P.O. Box 942850, Sacramento, CA 94250 SACRAMENTO 3301 C Street, Suite 700, Sacramento, CA 95816 | 916.324.8907 LOS ANGELES 901 Corporate Center Drive, Suite 200, Monterey Park, CA 91754 | 323.981.6802 City of Long Beach Domestic Violence Arrest Policies and Standards Program Contents Audit Report Summary ............................................................................................................................ 1 Background ........................................................................................................................ 1 Audit Authority.................................................................................................................. 1 Objective, Scope, and Methodology ................................................................................. 1 Conclusion .......................................................................................................................... 3 Follow-up on Prior Audit Findings .................................................................................. 4 Views of Responsible Officials .......................................................................................... 4 Restricted Use .................................................................................................................... 4 Schedule—Summary of Program Costs .............................................................................. 5 Findings and Recommendations ........................................................................................... 7 Attachment—City’s Response to Draft Audit Report City of Long Beach Domestic Violence Arrest Policies and Standards Program Audit Report Summary The State Controller’s Office (SCO) audited the costs claimed by the City of Long Beach (the city) for the legislatively mandated Domestic Violence Arrest Policies and Standards Program for the period of July 1, 2019, through June 30, 2023. The city claimed and was paid $465,699 for costs of the mandated program. Our audit found that $409,118 is allowable and $56,581 is unallowable. The costs are unallowable because the city overstated salary and benefit costs, and related indirect costs. Background Penal Code (PC) section 13701, subdivision (b) (added by Chapter 246, Statutes of 1995), required local law enforcement agencies to develop, adopt, and implement written arrest policies for domestic violence offenders by July 1, 1996. The legislation also required local law enforcement agencies to obtain input from local domestic violence agencies in developing the arrest policies. Under previous law, local law enforcement agencies were required to develop, adopt, and implement written policies for response to domestic violence calls and were encouraged, but not obligated, to consult with domestic violence experts. On September 25, 1997, the Commission on State Mandates determined that Chapter 246, Statutes of 1995, imposed a state mandated program reimbursable under Government Code (GC) section 17561. The program’s parameters and guidelines establish the state mandate and define the reimbursement criteria. The Commission on State Mandates adopted the parameters and guidelines on August 20, 1998, and amended them on October 30, 2009. In compliance with GC section 17758, the SCO issues the Mandated Cost Manual for Local Agencies (Mandated Cost Manual) to assist local agencies in claiming mandated program reimbursable costs. We conducted this performance audit in accordance with GC Audit Authority sections 17558.5 and 17561, which authorize the SCO to audit the city’s records to verify the actual amount of the mandated costs. In addition, GC section 12410 provides the SCO with general authority to audit the disbursement of state money for correctness, legality, and sufficient provisions of law for payment. Objective, Scope, The objective of our audit was to determine whether claimed costs represent increased costs resulting from the legislatively mandated and Methodology Domestic Violence Arrest Policies and Standards Program. Specifically, we conducted this audit to determine whether claimed costs were supported by appropriate source documents, were not funded by another source, and were not unreasonable and/or excessive. Unreasonable and/or excessive costs include unsupported and ineligible costs that are not -1- City of Long Beach Domestic Violence Arrest Policies and Standards Program identified in the program’s parameters and guidelines as reimbursable costs. The audit period was July 1, 2019, through June 30, 2023. To achieve our objective, we performed the following procedures: • We reviewed the annual mandated cost claims filed by the city for the audit period and identified the significant cost components of each claim as salaries and benefits, and related indirect costs. We then determined whether there were any errors or unusual or unexpected variances from year to year. We reviewed the claimed activities to determine whether they adhered to the SCO’s Mandated Cost Manual and the program’s parameters and guidelines. • We completed an internal control questionnaire by interviewing key city staff members. We discussed the claim preparation process with city staff to determine what information was obtained, who obtained it, and how it was used. We determined which controls were significant to the audit objective, and the effect of the identified internal control weaknesses on the audit objective. • We assessed the reliability of the data (payroll, revenue and expenditure records) generated from the city’s information management system and the city’s record management system, Central Square Records Enterprise, by interviewing city staff members and examining supporting documentation. We determined that the data was sufficiently reliable to address the audit objective. • We verified that the city used the uniform time allowance and applied it properly. • We reviewed and analyzed the claimed domestic violence incident report counts and verified that these counts were supported by the city’s Central Square Records Enterprise. • We used simple random sampling to select the following statistical samples from the audited population of incident reports: o We sampled 140 of 1,998 incident reports for fiscal year (FY) 2019-20. o We sampled 139 of 1,924 incident reports for FY 2020-21. o We sampled 140 of 2,094 incident reports for FY 2021-22. o We sampled 140 of 2,107 incident reports for FY 2022-23. • We determined whether the sampled incident reports included interviews with both parties involved in the domestic violence incident, and whether the officer considered the 17 factors listed in the parameters and guidelines to identify the primary aggressor. We identified the following errors: o Of the 140 sampled incident reports for FY 2019-20, 44 were partially reimbursable. o Of the 139 sampled incident reports for FY 2020-21, 50 were partially reimbursable and two were non-mandate-related. -2- City of Long Beach Domestic Violence Arrest Policies and Standards Program o Of the 140 sampled incident reports for FY 2021-22, 47 were partially reimbursable and one was non-mandate-related. o Of the 140 sampled incident reports for FY 2022-23, 58 were partially reimbursable and one was non-mandate-related. Errors found were projected to the intended (total) population; see Finding 1. • We recalculated the allowable costs using the audited incident report counts. • We interviewed city staff members to determine what employee classifications were involved in performing the mandated activities during the audit period. • We traced the average productive hourly rate calculations for the claimed employee classification to supporting information in the city’s payroll system. • We verified the indirect costs claimed by the city for the audit period. We found that the city had overstated the indirect cost rate claimed for FY 2022-23; see Finding 2. • We traced the benefit rate calculations for the claimed employee classification to supporting information in the city’s cost allocation plans. • We verified that the city’s claimed costs were not funded by any other sources. We conducted this performance audit in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objective. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objective. Conclusion As a result of performing the audit procedures, we found instances of noncompliance with the requirements described in our audit objective. We did not find that the city claimed costs that were funded by other sources; however, we found that it claimed unsupported and ineligible costs as quantified in the Schedule and described in the Findings and Recommendations section. For the audit period, the city claimed and was paid $465,699 for costs of the legislatively mandated Domestic Violence Arrest Policies and Standards Program. Our audit found that $409,118 is allowable and $56,581 is unallowable. Following issuance of this audit report, the SCO’s Local Government Programs and Services Division will notify the city of the adjustment to its claims via a system-generated letter for each fiscal year in the audit period. -3- City of Long Beach Domestic Violence Arrest Policies and Standards Program Follow-up on We have not previously conducted an audit of the city’s legislatively mandated Domestic Violence Arrest Policies and Standards Program. Prior Audit Findings Views of We issued a draft audit report on June 3, 2025. The ctiy’s representatives Responsible responded by letter dated June 12, 2025, agreeing with the audit findings. This final audit report includes the city’s response as an attachment. Officials Restricted Use This audit report is solely for the information and use of the city, the California Department of Finance, and the SCO; it is not intended to be, and should not be, used by anyone other than these specified parties. This restriction is not intended to limit distribution of this report, which is a matter of public record and is available on the SCO website at www.sco.ca.gov. Original signed by Kimberly A. Tarvin, CPA Chief, Division of Audits September 2, 2025 -4- City of Long Beach Domestic Violence Arrest Policies and Standards Program Schedule— Summary of Program Costs July 1, 2019, through June 30, 2023 Actual Costs Allowable Audit Cost Elements Claimed per Audit Adjustment Reference ¹ July 1, 2019, through June 30, 2020 Direct costs: Salaries and benefits $ 79,681 $ 73,034 $ (6,647) Finding 1 Indirect costs 27,460 25,169 ( 2,291) Finding 1 Total direct and indirect costs 107,141 98,203 ( 8,938) Less offsetting revenues and reimbursements2 - - - Total program costs $ 1 07,141 98,203 $ (8,938) Less amount paid by the State3 (107,141) Amount paid in excess of allowable costs claimed $ (8,938) July 1, 2020, through June 30, 2021 Direct costs: Salaries and benefits $ 78,548 $ 68,681 $ (9,867) Finding 1 Indirect costs 27,413 23,968 ( 3,445) Finding 1 Total direct and indirect costs 105,961 92,649 (13,312) Less offsetting revenues and reimbursements2 - - - Total program costs $ 1 05,961 92,649 $ (13,312) Less amount paid by the State3 (105,961) Amount paid in excess of allowable costs claimed $ (13,312) July 1, 2021, through June 30, 2022 Direct costs: Salaries and benefits $ 88,391 $ 79,158 $ (9,233) Finding 1 Indirect costs 31,464 28,178 ( 3,286) Finding 1 Total direct and indirect costs 119,855 107,336 (12,519) Less offsetting revenues and reimbursements2 - - - Total program costs $ 1 19,855 107,336 $ (12,519) Less amount paid by the State3 (119,855) Amount paid in excess of allowable costs claimed $ (12,519) -5- City of Long Beach Domestic Violence Arrest Policies and Standards Program Schedule (continued) -6- J D I T L T L A S D I T L T L A C o s t E le m e n ts u ly 1 , 2 0 2 2 , th r o u g h J u n e 3 0 , 2 ir e c t c o s ts : S a la r ie s a n d b e n e f its n d ir e c t c o s ts o ta l d ir e c t a n d in d ir e c t c o s ts e s s o f f s e ttin g r e v e n u e s a n d r e o ta l p r o g r a m c o s ts 3 e s s a m o u n t p a id b y th e S ta te m o u n t p a id in e x c e s s o f a llo w u m m a r y : J u ly 1 , 2 0 1 9 , th r o u g h ir e c t c o s ts : S a la r ie s a n d b e n e f its n d ir e c t c o s ts o ta l d ir e c t a n d in d ir e c t c o s ts e s s o f f s e ttin g r e v e n u e s a n d r e o ta l p r o g r a m c o s ts 3 e s s a m o u n t p a id b y th e S ta te m o u n t p a id in e x c e s s o f a llo w 0 2 3 im b a b le J u n im b a b le u r s c o e 3 u r s c o e s 0 e s 2 m e n ts ts c la im , 2 0 2 3 2 m e n ts ts c la im e e d d A c tu a l C o s ts C la im e d $ 9 5 ,9 6 5 3 6 ,7 7 7 1 3 2 ,7 4 2 - $ 1 3 2 ,7 4 2 $ 3 4 2 ,5 8 5 1 2 3 ,1 1 4 4 6 5 ,6 9 9 - $ 4 6 5 ,6 9 9 A llo w a b le p e r A u d it $ 8 4 ,0 1 0 2 6 ,9 2 0 1 1 0 ,9 3 0 - 1 1 0 ,9 3 0 ( 1 3 2 ,7 4 2 $ ( 2 1 ,8 1 2 $ 3 0 4 ,8 8 3 1 0 4 ,2 3 5 4 0 9 ,1 1 8 - 4 0 9 ,1 1 8 ( 4 6 5 ,6 9 9 $ ( 5 6 ,5 8 1 ) ) ) ) A u d it A d ju s tm e n t ¹ $ ( 1 1 ,9 5 5 ) ( 9 ,8 5 7 ) ( 2 1 ,8 1 2 ) - $ ( 2 1 ,8 1 2 ) $ ( 3 7 ,7 0 2 ) ( 1 8 ,8 7 9 ) ( 5 6 ,5 8 1 ) - $ ( 5 6 ,5 8 1 ) R F F F F e in in in in fe r d in d in d in d in e g g g g n c e ¹ 1 s 1 , 2 1 s 1 , 2 _________________________ 1 See the Findings and Recommendations section. 2 We determined the claimed costs were not funded by any other sources. 3 Payment amount current as of July 28, 2025. City of Long Beach Domestic Violence Arrest Policies and Standards Program Findings and Recommendations FINDING 1— The city claimed non-reimbursable salaries and benefits totaling $37,702. The related indirect costs total $13,603, for a total finding of $51,305. Non-reimbursable costs The reimbursable activities for this cost component consist of interviewing both parties involved in the domestic violence incident and considering the 17 factors identified in the program’s parameters and guidelines to identify the primary aggressor. To calculate the claimed costs, the city multiplied the number of reported responses to incidents by the average productive hourly rate, including the applicable indirect costs, then multiplied the resulting amount by the standard time of 29 minutes (0.48 of an hour). For each fiscal year, we selected a statistical sample from the documented number of domestic violence incident reports (the audited population) based on a 95% confidence level, a precision rate of ± 8%, and an expected error rate of 50%. We used statistical samples so that the results could be projected to the population for each fiscal year. For testing purposes, we selected a random sample of 559 incident reports (140 for FY 2019-20, 139 for FY 2020-21, 140 for FY 2021-22, and 140 for FY 2022-23). We reviewed the sample incident reports to determine whether the city performed the required mandated program activities. We documented the results of our review of sample incident reports as follows: • Allowable – 356 incident reports were fully reimbursable under the mandated program. These reports are reimbursable at 29 minutes (0.48 hours) per report. • Partially reimbursable – 199 incident reports were partially reimbursable, because the officers did not interview both parties involved in the domestic violence incident. These reports are reimbursable at 20.5 minutes (0.34 hours) per report, based on 8.5 minutes to interview one party and 12 minutes to consider the various factors identified in the program’s parameters and guidelines. • Unallowable – Four incident reports were ineligible for reimbursement or were non-mandate-related. Non-mandate-related incidents were those that did not meet the definition of domestic violence as provided in PC section 13700; the incidents relate to no interviews documented or provided, verbal altercation, or false accusation. During testing, we found that the city claimed the entire standard time of 29 minutes for incident reports that were only partially reimbursable and claimed reimbursement for ineligible and unsupported incident reports. The city overstated these costs because it did not claim costs in accordance -7- City of Long Beach Domestic Violence Arrest Policies and Standards Program with the program’s parameters and guidelines or the SCO’s Mandated Cost Manual. The following table summarizes the results of the statistical samples: -8- A P U T llo w a b le in c id e n a r tia lly r e im b u r s ( o n ly o n e p a r n a llo w a b le in c id o ta l r e p o r ts s a m t r e p o r ts a b le in c id e n ty in te r v ie w e n t r e p o r ts p le d t r e d e ) p o r ts 2 0 1 9 - 2 0 9 6 4 4 - 1 4 0 F is c a 2 0 2 0 - 2 1 8 7 5 0 2 1 3 9 l Y e a r 2 0 2 1 - 2 2 9 2 4 7 1 1 4 0 2 0 2 2 - 2 3 8 1 5 8 1 1 4 0 T o ta l 3 5 6 1 9 9 4 5 5 9 The following table summarizes the unallowable hours based on the results of the statistical samples by fiscal year: Fiscal Year 2019-20 2020-21 2021-22 2022-23 Total Allowable incident reports 9 6 8 7 9 2 8 1 3 56 Standard time allowance (hours) × 0.48 × 0.48 × 0.48 × 0.48 Subtotal [A] 4 6 4 2 4 4 3 9 Partially reimbursable incident reports (only one party interviewed) 4 4 5 0 4 7 5 8 1 99 Allowable standard time allowance (hours) × 0.34 × 0.34 × 0.34 × 0.34 Subtotal [B] 1 5 1 7 1 6 2 0 Total reimbursable hours for sampled reports [C] = [A] + [B] 6 1 5 9 6 0 5 9 Statistical sample size ÷ 140 ÷ 139 ÷ 140 ÷ 140 Reimbursable hours per report 0.44 0.42 0.43 0.42 Documented number of domestic violence incident reports × 1,998 × 1,924 × 2,094 × 2,107 Total reimbursable hours 879 808 900 885 Hours per documented number of domestic violence incident reports + ( 959) + ( 924) + (1,005) + (1,011) Total unallowable hours (80) ( 116) ( 105) ( 126) City of Long Beach Domestic Violence Arrest Policies and Standards Program The following table summarizes the unallowable costs based on the unallowable hours identified from the statistical samples by fiscal year: -9- 1 U n a llo w a b le h o u rs C la im e d a v e ra g e P H R (s a la ry o n ly ) U n a llo w a b le s a la rie s [A ] C la im e d b e n e fit ra te [B ] R e la te d u n a llo w a b le b e n e fit c o s ts [C ] = [A T o ta l u n a llo w a b le s a la rie s a n d b e n e fits [D ] = [A ] + [C ] C la im e d in d ire c t c o s t ra te [E ] 1 R e la te d in d ire c t c o s ts [F ] = [D ] x [E ] A u d it a d ju s tm e n t [G ] = [D ] + [F ] In d ire c t c o s ts w e re c o m p u te d u s in g s a la rie ] x s a [B ] n d b e n 2 0 1 9 -2 0 (8 × $ 4 9 .6 (3 ,9 6 × 6 7 .5 1 (2 ,6 7 (6 ,6 4 × 3 4 .4 7 (2 ,2 9 $ (8 ,9 3 e fits . 00 8% 9 7 % 1 8 ) ) ) ) ) ) × × × F is c a 2 0 2 0 -2 1 (1 1 6 ) $ 4 9 .6 0 (5 ,7 5 4 ) 7 1 .4 8 % (4 ,1 1 3 ) (9 ,8 6 7 ) 3 4 .9 1 % (3 ,4 4 5 ) $ (1 3 ,3 1 2 ) l Y × × × e a r 2 0 2 1 -2 2 (1 0 $ 5 1 .0 (5 ,3 6 7 2 .1 6 (3 ,8 7 (9 ,2 3 3 5 .5 9 (3 ,2 8 $ (1 2 ,5 1 58 3% 0 3 % 6 9 ) ) ) ) ) ) × × × 2 0 2 2 -2 3 (1 2 $ 5 5 .2 (6 ,9 6 7 1 .7 7 (4 ,9 9 (1 1 ,9 5 3 8 .3 2 (4 ,5 8 $ (1 6 ,5 3 64 0% 5 5 % 1 6 ) ) ) ) ) ) T o ta (3 7 (1 3 $ (5 1 l ,7 ,6 ,3 0 0 0 2 3 5 ) ) ) Criteria Section IV, “Reimbursable Activities,” of the parameters and guidelines begins: To be eligible for mandated cost reimbursement for any fiscal year, only actual costs may be claimed. Actual costs are those costs actually incurred to implement the mandated activities. Actual costs must be traceable and supported by source documents that show the validity of such costs, when they were incurred, and their relationship to the reimbursable activities. A source document is a document created at or near the same time the actual cost was incurred for the event or activity in question. Source documents may include, but are not limited to, employee time records or time logs, sign-in sheets, invoices, and receipts. . . . Section IV, “Reimbursable Activities,” of the parameters and guidelines continues: The claimant is only allowed to claim and be reimbursed for increased costs for reimbursable activities. . . . Increased cost is limited to the cost of an activity that the claimant is required to incur as a result of the mandate. Section IV.E, “Uniform Cost Allowance,” of the parameters and guidelines states: Pursuant to Government Code section 17557, the Commission on State Mandates has adopted a uniform cost allowance for reimbursement in lieu of payment of total actual costs incurred. The uniform cost allowance is applied only to Section IV, Reimbursable Activities, Component D (Implementation of the New Domestic Violence Arrest Policies to Identify the Primary Aggressor) and covers all costs (direct and indirect) of performing activities described under Component D. The uniform cost allowance provides the following: A standard time of twenty-nine (29) minutes may be claimed to identify the primary aggressor in any domestic violence incident. City of Long Beach Domestic Violence Arrest Policies and Standards Program The standard time of twenty-nine (29) minutes is broken down as follows: • Seventeen (17) Minutes – Interview of both parties • Twelve (12) Minutes – Consideration of the factors listed [under Component D] The total cost will be determined by multiplying the number of reported responses × the average productive hourly rate, including applicable indirect costs as specified in section V., paragraph B, herein, × .48 (29 minutes divided by 60 minutes). Recommendation We recommend that the city: • Follow the program’s parameters and guidelines and the SCO’s Mandated Cost Manual when preparing its reimbursement claims; • Claim costs for only those reports that document incidents meeting the definition of domestic violence by PC section 13700; and • Claim only the portion of the standard time allowance that is attributable to the mandated activities performed. City’s Response: The city concurred with the audit finding. FINDING 2— For the audit period, the city claimed indirect costs based on indirect cost rate proposals (ICRP) prepared for the police department. We found that Overstated indirect the city overstated its indirect costs for FY 2022-23 by $5,276. The costs cost rates were overstated because the city used the incorrect Cost Allocation Plans, and used costs incurred in the fiscal period of October through September instead of July through June. During testing, we requested, and the city provided, expenditure reports and Cost Allocation Plans with the correct fiscal period of July through June for FY 2019-20 through FY 2022-23. We found that by using the incorrect fiscal period, the city overstated the indirect costs rate for FY 2022-23. We applied the error rate to allowable salaries and benefits to calculate the overstated indirect costs for FY 2022-23, a total finding of $5,276. The city overstated these costs because it did not claim costs in accordance with the program’s parameters and guidelines or the SCO’s Mandated Cost Manual. The following table summarizes the claimed, allowable, and adjusted indirect cost rates: Claimed Allowable Fiscal Indirect Cost Indirect Cost Audit Year Rate Rate Adjustment 2022-23 38.32% 32.04% (6.28)% -10- City of Long Beach Domestic Violence Arrest Policies and Standards Program The following table summarizes the adjustment to the indirect costs: Fiscal Year 2022-23 Total Allowable indirect cost rate 32.04% Claimed indirect cost rate + (38.32)% Error rate (6.28)% Allowable salaries and benefits × 84,010 Audit adjustment $ ( 5,276) $ ( 5,276) Criteria Section IV, “Reimbursable Activities,” of the parameters and guidelines begins: To be eligible for mandated cost reimbursement for any fiscal year, only actual costs may be claimed. Actual costs are those costs actually incurred to implement the mandated activities. Actual costs must be traceable and supported by source documents that show the validity of such costs, when they were incurred, and their relationship to the reimbursable activities. A source document is a document created at or near the same time the actual cost was incurred for the event or activity in question. Source documents may include, but are not limited to, employee time records or time logs, sign-in sheets, invoices, and receipts. . . . Section IV, “Reimbursable Activities,” of the parameters and guidelines continues: The claimant is only allowed to claim and be reimbursed for increased costs for reimbursable activities. . . . Increased cost is limited to the cost of an activity that the claimant is required to incur as a result of the mandate. Section V.B., “Indirect Costs,” of the parameters and guidelines states: Indirect costs are defined as costs which are incurred for common or joint purpose, benefiting more than one program and are not directly assignable to a particular department of program without efforts disproportionate to the result achieved. Indirect costs may include both (1) overhead costs of the unit performing the mandate; and (2) the costs of central government services distributed to other departments based on a systematic and rational basis through a cost allocation plan. Compensation for indirect costs is reimbursable utilizing the procedure provided in the [Office of Management and Budget Circular] A-87. Claimants have the option of using 10% of direct labor, excluding fringe benefits, or preparing a departmental Indirect Cost Rate Proposal (ICRP) for the department if an indirect cost in excess of 10% is claimed. If more than one department is claiming indirect costs for the mandated program, each department must have its own ICRP prepared in accordance with [Office of Management and Budget Circular] A-87. An ICRP must be submitted with the claim when the indirect cost rate is in excess of 10%. -11- City of Long Beach Domestic Violence Arrest Policies and Standards Program Recommendation We recommend that the city: • Follow the program’s parameters and guidelines and the SCO’s Mandated Cost Manual when preparing its reimbursement claims; • Ensure that the correct fiscal year costs are used to calculate indirect cost rates applicable to the corresponding fiscal year; and • Ensure that the correct fiscal period of July through June is used to calculate indirect cost rates. City’s Response: The city concurred with the audit finding. -12- City of Long Beach Domestic Violence Arrest Policies and Standards Program Attachment— City’s Response to Draft Audit Report State Controller’s Office Division of Audits Post Office Box 942850 Sacramento, CA 94250 www.sco.ca.gov S25-MCC-0005