FAC Explorer

Audit 176603

FY End
2022-06-30
Total Expended
$5.18M
Findings
8
Programs
12
Organization: Farwell Area Schools (MI)
Year: 2022 Accepted: 2022-10-31
Auditor: Roslund Prestage & Company PC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
178341 2022-001 Material Weakness - A
178342 2022-001 Material Weakness - A
178343 2022-001 Material Weakness - A
178344 2022-001 Material Weakness - A
754783 2022-001 Material Weakness - A
754784 2022-001 Material Weakness - A
754785 2022-001 Material Weakness - A
754786 2022-001 Material Weakness - A

Programs

ALN Program Spent Major Findings
84.010 Title I Grants to Local Educational Agencies $636,337 - 0
84.027 Special Education_grants to States $323,431 Yes 0
84.367 Improving Teacher Quality State Grants $80,614 - 0
84.424 Student Support and Academic Enrichment Program $42,461 - 0
10.553 School Breakfast Program $29,713 - 0
84.358 Rural Education $18,298 - 0
93.778 Medical Assistance Program $16,848 - 0
84.425 Education Stabilization Fund $10,500 Yes 1
10.555 National School Lunch Program $6,881 - 0
10.559 Summer Food Service Program for Children $6,466 - 0
10.649 Pandemic Ebt Administrative Costs $3,063 - 0
10.558 Child and Adult Care Food Program $54 - 0

Contacts

Name Title Type
QTJFJ54KEV21 Dorothy Boge Auditee
9895889917 Christina Schaub Auditor
No contacts on file

Notes to SEFA

Title: BASIS OF PRESENTATION Accounting Policies: Expenditures reported on the schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts (if any) shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Pass-through entity identifying numbers are presented where available. Farwell Area Schools has elected to not use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The accompanying schedule of expenditures of federal awards (the schedule) includes the federal award activity of Farwell Area Schools under programs of the federal government for the year ended June 30, 2022. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) 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 Farwell Area Schools, it is not intended to and does not present its financial position or changes in net position of Farwell Area Schools.Management has utilized the Nexsys cash management system and the Grant Auditor Report in preparing the Schedule of Expenditures of Federal Awards. The District does not pass through federal funds.
Title: RECONCILIATION WITH AUDITED FINANCIAL STATEMENTS Accounting Policies: Expenditures reported on the schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts (if any) shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Pass-through entity identifying numbers are presented where available. Farwell Area Schools has elected to not use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. Federal expenditures are reported as revenues in the following funds in the financial statements of Farwell Area Schools:Fund Financial statementsAmountGeneral Fund4,282,497Food Service Fund936,982 Total federal revenue in the fund financial statements5,219,479Less: Federal assistance funding not subject to single audit act(37,213) Federal revenues subject to single audit act5,182,266

Finding Details

Finding 2022-001
2022-001 - ACTIVITIES ALLOWED OR UNALLOWED / ALLOWABLE COSTS/COST PRINCIPLES Program: ALN 84.425 Education Stabilization Fund, ESSER II - Formula Type: Material Weakness in Internal Control / Non-Compliance Criteria: As detailed by 2 CFR 200.402, the total cost of a Federal award is the sum of the allowable direct and allocable indirect costs less any applicable credits. Condition: During testing of amounts charged to the grants it was noted that payments were charged to the grant but were not authorized by the grant. Cause/Effect: This condition appears to be the result of a misunderstanding of costs allowed under this grant. These costs were not in compliance with 2 CFR 200.402. Questioned Cost: $104,101 Recommendation: We recommend that the District review all grant agreements to gain a thorough understanding of allowable costs and then establish/modify internal controls to assure that only allowable costs are charged to the grant. View of Responsible Official: Management is in agreement with this recommendation
Finding 2022-001
2022-001 - ACTIVITIES ALLOWED OR UNALLOWED / ALLOWABLE COSTS/COST PRINCIPLES Program: ALN 84.425 Education Stabilization Fund, ESSER II - Formula Type: Material Weakness in Internal Control / Non-Compliance Criteria: As detailed by 2 CFR 200.402, the total cost of a Federal award is the sum of the allowable direct and allocable indirect costs less any applicable credits. Condition: During testing of amounts charged to the grants it was noted that payments were charged to the grant but were not authorized by the grant. Cause/Effect: This condition appears to be the result of a misunderstanding of costs allowed under this grant. These costs were not in compliance with 2 CFR 200.402. Questioned Cost: $104,101 Recommendation: We recommend that the District review all grant agreements to gain a thorough understanding of allowable costs and then establish/modify internal controls to assure that only allowable costs are charged to the grant. View of Responsible Official: Management is in agreement with this recommendation
Finding 2022-001
2022-001 - ACTIVITIES ALLOWED OR UNALLOWED / ALLOWABLE COSTS/COST PRINCIPLES Program: ALN 84.425 Education Stabilization Fund, ESSER II - Formula Type: Material Weakness in Internal Control / Non-Compliance Criteria: As detailed by 2 CFR 200.402, the total cost of a Federal award is the sum of the allowable direct and allocable indirect costs less any applicable credits. Condition: During testing of amounts charged to the grants it was noted that payments were charged to the grant but were not authorized by the grant. Cause/Effect: This condition appears to be the result of a misunderstanding of costs allowed under this grant. These costs were not in compliance with 2 CFR 200.402. Questioned Cost: $104,101 Recommendation: We recommend that the District review all grant agreements to gain a thorough understanding of allowable costs and then establish/modify internal controls to assure that only allowable costs are charged to the grant. View of Responsible Official: Management is in agreement with this recommendation
Finding 2022-001
2022-001 - ACTIVITIES ALLOWED OR UNALLOWED / ALLOWABLE COSTS/COST PRINCIPLES Program: ALN 84.425 Education Stabilization Fund, ESSER II - Formula Type: Material Weakness in Internal Control / Non-Compliance Criteria: As detailed by 2 CFR 200.402, the total cost of a Federal award is the sum of the allowable direct and allocable indirect costs less any applicable credits. Condition: During testing of amounts charged to the grants it was noted that payments were charged to the grant but were not authorized by the grant. Cause/Effect: This condition appears to be the result of a misunderstanding of costs allowed under this grant. These costs were not in compliance with 2 CFR 200.402. Questioned Cost: $104,101 Recommendation: We recommend that the District review all grant agreements to gain a thorough understanding of allowable costs and then establish/modify internal controls to assure that only allowable costs are charged to the grant. View of Responsible Official: Management is in agreement with this recommendation
Finding 2022-001
2022-001 - ACTIVITIES ALLOWED OR UNALLOWED / ALLOWABLE COSTS/COST PRINCIPLES Program: ALN 84.425 Education Stabilization Fund, ESSER II - Formula Type: Material Weakness in Internal Control / Non-Compliance Criteria: As detailed by 2 CFR 200.402, the total cost of a Federal award is the sum of the allowable direct and allocable indirect costs less any applicable credits. Condition: During testing of amounts charged to the grants it was noted that payments were charged to the grant but were not authorized by the grant. Cause/Effect: This condition appears to be the result of a misunderstanding of costs allowed under this grant. These costs were not in compliance with 2 CFR 200.402. Questioned Cost: $104,101 Recommendation: We recommend that the District review all grant agreements to gain a thorough understanding of allowable costs and then establish/modify internal controls to assure that only allowable costs are charged to the grant. View of Responsible Official: Management is in agreement with this recommendation
Finding 2022-001
2022-001 - ACTIVITIES ALLOWED OR UNALLOWED / ALLOWABLE COSTS/COST PRINCIPLES Program: ALN 84.425 Education Stabilization Fund, ESSER II - Formula Type: Material Weakness in Internal Control / Non-Compliance Criteria: As detailed by 2 CFR 200.402, the total cost of a Federal award is the sum of the allowable direct and allocable indirect costs less any applicable credits. Condition: During testing of amounts charged to the grants it was noted that payments were charged to the grant but were not authorized by the grant. Cause/Effect: This condition appears to be the result of a misunderstanding of costs allowed under this grant. These costs were not in compliance with 2 CFR 200.402. Questioned Cost: $104,101 Recommendation: We recommend that the District review all grant agreements to gain a thorough understanding of allowable costs and then establish/modify internal controls to assure that only allowable costs are charged to the grant. View of Responsible Official: Management is in agreement with this recommendation
Finding 2022-001
2022-001 - ACTIVITIES ALLOWED OR UNALLOWED / ALLOWABLE COSTS/COST PRINCIPLES Program: ALN 84.425 Education Stabilization Fund, ESSER II - Formula Type: Material Weakness in Internal Control / Non-Compliance Criteria: As detailed by 2 CFR 200.402, the total cost of a Federal award is the sum of the allowable direct and allocable indirect costs less any applicable credits. Condition: During testing of amounts charged to the grants it was noted that payments were charged to the grant but were not authorized by the grant. Cause/Effect: This condition appears to be the result of a misunderstanding of costs allowed under this grant. These costs were not in compliance with 2 CFR 200.402. Questioned Cost: $104,101 Recommendation: We recommend that the District review all grant agreements to gain a thorough understanding of allowable costs and then establish/modify internal controls to assure that only allowable costs are charged to the grant. View of Responsible Official: Management is in agreement with this recommendation
Finding 2022-001
2022-001 - ACTIVITIES ALLOWED OR UNALLOWED / ALLOWABLE COSTS/COST PRINCIPLES Program: ALN 84.425 Education Stabilization Fund, ESSER II - Formula Type: Material Weakness in Internal Control / Non-Compliance Criteria: As detailed by 2 CFR 200.402, the total cost of a Federal award is the sum of the allowable direct and allocable indirect costs less any applicable credits. Condition: During testing of amounts charged to the grants it was noted that payments were charged to the grant but were not authorized by the grant. Cause/Effect: This condition appears to be the result of a misunderstanding of costs allowed under this grant. These costs were not in compliance with 2 CFR 200.402. Questioned Cost: $104,101 Recommendation: We recommend that the District review all grant agreements to gain a thorough understanding of allowable costs and then establish/modify internal controls to assure that only allowable costs are charged to the grant. View of Responsible Official: Management is in agreement with this recommendation