Audit 14264

2023-001: Procurement Special Education Cluster Assistance Listing Numbers – 84.027A; 84.027X; 84.173A; 84.173X Questioned Costs: Undetermined Criteria: 2 CFR 200.320 of the Uniform Guidance requires small purchases (generally above $10,000 but below $250,000) be made upon obtaining an adequate number of qualified sources as determined appropriate by the non-Federal entity and an adequate number of quotes from qualified sources. Furthermore, appendix II of the Uniform Guidance requires certain compliance matters to be included in contracts involving federal funds with vendors. Condition: The School Board purchased two instructional informational technology programs for use in its Special Education program; one for $249,000 and one for $86,000. Sufficient evidence was not provided to demonstrate that the School Board’s personnel obtained and decided upon these purchases using an adequate number of quotes. Also, the compliance matters required by appendix II were not included in the contract. Universe/population: A sampling of three product procurements whose payments during the fiscal year totaling $535,726 were selected for testing from a population of twenty-one such payments totaling $992,154. Two of the three purchases tested (and noted above in the condition caption) were found to be non-compliant with the procurement requirements of the Uniform Guidance. Effect: The School Board may be non-compliant with the requirements of the Uniform Guidance, which encourages competition to control costs. Furthermore, if the provisions of appendix II are not included then the School Board risks lacking various protections under federal law. Cause: This may be the result of a misunderstanding of the applicability of the Uniform Guidance by the grant administrator. Recommendation: Federal grant administrators and others should be reminded of the contractual and regulatory responsibilities to follow the Uniform Guidance. Adherence to the Uniform Guidance is also required by School Board policy. View of Responsible Official: The Business Department will review the Uniform Guidance requirements with all grant administrators and procurement staff to ensure compliance with federal regulations and district policy; and it will establish a more thorough review process for contracts to ensure compliance with all requirements.

2023-002: Reporting Federal Emergency Management Act (FEMA) Assistance Listing Number – 97.036 Questioned Costs: None Criteria: Internal controls should be designed to ensure proper reconciliation and review of all reimbursement requests to the accounting records to prevent or detect misstatements or inappropriate request of reimbursement from federal funds. Condition: The School Board’s process for preparing and filing reimbursement requests forms for FEMA PA funds does not involve the review by the School Board’s accounting department and reconciliation back to the accounting system. Cause: The School Board’s has outsourced the administration of the Program to a private consultant. The accounting reconciliation and review aspects of grants administration may have been presumed to be performed by the consultant. Questioned Costs: N/A Effect: Errors and duplications of costs related to the reimbursement of program expenses could result in material misstatements and not be detected by the internal controls of the School Board. Recommendation: The School Board should apply the same internal controls of reconciliations and reviews of grant reimbursement requests that it applies to its education type grants. View of Responsible Official: The district will adjust its operations to include a financial review and reconciliation of the reimbursement requests prepared on its behalf by the private consultant administering the program.

2023-001: Procurement Special Education Cluster Assistance Listing Numbers – 84.027A; 84.027X; 84.173A; 84.173X Questioned Costs: Undetermined Criteria: 2 CFR 200.320 of the Uniform Guidance requires small purchases (generally above $10,000 but below $250,000) be made upon obtaining an adequate number of qualified sources as determined appropriate by the non-Federal entity and an adequate number of quotes from qualified sources. Furthermore, appendix II of the Uniform Guidance requires certain compliance matters to be included in contracts involving federal funds with vendors. Condition: The School Board purchased two instructional informational technology programs for use in its Special Education program; one for $249,000 and one for $86,000. Sufficient evidence was not provided to demonstrate that the School Board’s personnel obtained and decided upon these purchases using an adequate number of quotes. Also, the compliance matters required by appendix II were not included in the contract. Universe/population: A sampling of three product procurements whose payments during the fiscal year totaling $535,726 were selected for testing from a population of twenty-one such payments totaling $992,154. Two of the three purchases tested (and noted above in the condition caption) were found to be non-compliant with the procurement requirements of the Uniform Guidance. Effect: The School Board may be non-compliant with the requirements of the Uniform Guidance, which encourages competition to control costs. Furthermore, if the provisions of appendix II are not included then the School Board risks lacking various protections under federal law. Cause: This may be the result of a misunderstanding of the applicability of the Uniform Guidance by the grant administrator. Recommendation: Federal grant administrators and others should be reminded of the contractual and regulatory responsibilities to follow the Uniform Guidance. Adherence to the Uniform Guidance is also required by School Board policy. View of Responsible Official: The Business Department will review the Uniform Guidance requirements with all grant administrators and procurement staff to ensure compliance with federal regulations and district policy; and it will establish a more thorough review process for contracts to ensure compliance with all requirements.

2023-002: Reporting Federal Emergency Management Act (FEMA) Assistance Listing Number – 97.036 Questioned Costs: None Criteria: Internal controls should be designed to ensure proper reconciliation and review of all reimbursement requests to the accounting records to prevent or detect misstatements or inappropriate request of reimbursement from federal funds. Condition: The School Board’s process for preparing and filing reimbursement requests forms for FEMA PA funds does not involve the review by the School Board’s accounting department and reconciliation back to the accounting system. Cause: The School Board’s has outsourced the administration of the Program to a private consultant. The accounting reconciliation and review aspects of grants administration may have been presumed to be performed by the consultant. Questioned Costs: N/A Effect: Errors and duplications of costs related to the reimbursement of program expenses could result in material misstatements and not be detected by the internal controls of the School Board. Recommendation: The School Board should apply the same internal controls of reconciliations and reviews of grant reimbursement requests that it applies to its education type grants. View of Responsible Official: The district will adjust its operations to include a financial review and reconciliation of the reimbursement requests prepared on its behalf by the private consultant administering the program.