FAC Explorer

Audit 299307

FY End
2023-06-30
Total Expended
$2.85M
Findings
4
Programs
15
Organization: Fountain Hills Unified School District No. 98 (AZ)
Year: 2023 Accepted: 2024-03-28
Auditor: Heinfeld Meech & CO PC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
386968 2023-001 Material Weakness - AB
386969 2023-002 Material Weakness - L
963410 2023-001 Material Weakness - AB
963411 2023-002 Material Weakness - L

Programs

ALN Program Spent Major Findings
84.041 Impact Aid $1.18M Yes 0
84.027 Special Education_grants to States $384,607 - 0
84.010 Title I Grants to Local Educational Agencies $201,114 - 0
21.027 Covid-19 Coronavirus State and Local Fiscal Recovery Funds $164,190 - 0
10.555 National School Lunch Program $159,791 - 0
84.367 Supporting Effective Instruction State Grants $48,490 - 0
84.048 Career and Technical Education -- Basic Grants to States $24,653 - 0
32.009 Covid-19 Emergency Connectivity Fund Program $19,729 - 0
10.553 School Breakfast Program $18,007 - 0
84.027 Covid-19 Special Education_grants to States $13,975 - 0
84.173 Special Education_preschool Grants $13,540 - 0
84.424 Student Support and Academic Enrichment Program $7,647 - 0
93.778 Medical Assistance Program $4,297 - 0
84.173 Covid-19 Special Education_preschool Grants $3,786 - 0
84.425 Covid-19 Education Stabilization Fund $974 Yes 0

Contacts

Name Title Type
T8L3L1N4MM66 Craig Rudolphy Auditee
4806645088 Jill A. Shaw, CPA Auditor
No contacts on file

Notes to SEFA

Title: Assistance Listing Numbers Accounting Policies: Significant Accounting Policies Used in Preparing the SEFA The accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal grant activity of Fountain Hills Unified School District No. 98 under programs of the federal government for the year ended June 30, 2023. The information in the 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 District, it is not intended to and does not present the financial position, changes in net position or cash flows of the District. Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. 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. Any negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Passthrough entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis indirect cost rate. Assistance Listing Numbers The program titles and Assistance Listing numbers were obtained from the federal or pass‐through grantor or through sam.gov. If the three‐digit Assistance Listing extension is unknown, there is a U followed by a two‐digit number in the Assistance Listing extension to identify one or more Federal award lines from that program. The first Federal program with an unknown three‐digit extension is indicated with U01 for all award lines associated with that program, the second is U02, etc.

Finding Details

Finding 2023-001
Findings and Questioned Costs Related to Federal Awards Finding Number: 2023‐001 Repeat Finding: No Program Name/Assistance Listing Title: Education Stabilization Fund Assistance Listing Number: 84.425 Federal Agency: U.S. Department of Education Federal Award Number: S425U210038 Pass‐Through Agency: Arizona Department of Education Questioned Costs: N/A Type of Finding: Noncompliance, Material Weakness Compliance Requirement: Activities Allowed or Unallowed and Allowable Costs/Cost Principles Criteria Districts must submit an application through the Arizona Department of Education’s (ADE) Grants Management Enterprise system for ADE to review and approve grant expenditures. Each time the District makes an update to the expenditures that will be funded by the grant, the District must file an amended application which must be approved by ADE. Condition The District did not update the ESSER III grant application in a timely manner. The last time the grant application was updated was May 4, 2022. Since that date, the District has made changes to the expenditures funded from the grant, but has not notified ADE of those changes. Cause The District has not developed nor implemented strong internal controls over grant reporting due to turnover in key finance positions. Effect The District is at risk for making unallowable expenditures. Context For eight of 10 disbursements paid using Education Stabilization Fund funding reviewed, the District did not include the expenditures on the grant application approved by the ADE. The sample was not intended to be, and was not, a statistically valid sample. Recommendation The District should develop or implement strong internal controls over grant reporting to reduce the risk of making allowable expenditures. Views of Responsible Officials See Corrective Action Plan.
Finding 2023-002
Findings and Questioned Costs Related to Federal Awards Finding Number: 2023‐002 Repeat Finding: No Program Name/Assistance Listing Title: Education Stabilization Fund Assistance Listing Number: 84.425 Federal Agency: U.S. Department of Education Federal Award Number: S425U210038 Pass‐Through Agency: Arizona Department of Education Questioned Costs: N/A Type of Finding: Noncompliance, Material Weakness Compliance Requirement: Reporting Criteria Districts that received Education Stabilization Fund funding were required by the Arizona Department of Education to complete the “LEA Uses of ESSER I, II, & III – Use of Funds Detail” report by April 21, 2023. The report is based on fiscal year 2021‐22 financial information and full‐time equivalency (FTE) information. Condition Inadequate internal controls existed over the Education Stabilization Fund reporting processes. Cause The District has not developed nor implemented strong internal controls over reporting due to turnover in key finance positions. Effect The District is at risk of reporting inaccurate information. Context The District was unable to provide supporting documentation for the allocation of expenditures to the four categories in the report. In addition, the FTE reported as of September 30, 2022, did not agree to supporting documentation. Lastly, total FY22 ESSER III expenditures reported did not agree to accounting records by $106,755. Recommendation The District should develop or implement strong internal controls over reporting to reduce the risk of reporting inaccurate information. Views of Responsible Officials See Corrective Action Plan.
Finding 2023-001
Findings and Questioned Costs Related to Federal Awards Finding Number: 2023‐001 Repeat Finding: No Program Name/Assistance Listing Title: Education Stabilization Fund Assistance Listing Number: 84.425 Federal Agency: U.S. Department of Education Federal Award Number: S425U210038 Pass‐Through Agency: Arizona Department of Education Questioned Costs: N/A Type of Finding: Noncompliance, Material Weakness Compliance Requirement: Activities Allowed or Unallowed and Allowable Costs/Cost Principles Criteria Districts must submit an application through the Arizona Department of Education’s (ADE) Grants Management Enterprise system for ADE to review and approve grant expenditures. Each time the District makes an update to the expenditures that will be funded by the grant, the District must file an amended application which must be approved by ADE. Condition The District did not update the ESSER III grant application in a timely manner. The last time the grant application was updated was May 4, 2022. Since that date, the District has made changes to the expenditures funded from the grant, but has not notified ADE of those changes. Cause The District has not developed nor implemented strong internal controls over grant reporting due to turnover in key finance positions. Effect The District is at risk for making unallowable expenditures. Context For eight of 10 disbursements paid using Education Stabilization Fund funding reviewed, the District did not include the expenditures on the grant application approved by the ADE. The sample was not intended to be, and was not, a statistically valid sample. Recommendation The District should develop or implement strong internal controls over grant reporting to reduce the risk of making allowable expenditures. Views of Responsible Officials See Corrective Action Plan.
Finding 2023-002
Findings and Questioned Costs Related to Federal Awards Finding Number: 2023‐002 Repeat Finding: No Program Name/Assistance Listing Title: Education Stabilization Fund Assistance Listing Number: 84.425 Federal Agency: U.S. Department of Education Federal Award Number: S425U210038 Pass‐Through Agency: Arizona Department of Education Questioned Costs: N/A Type of Finding: Noncompliance, Material Weakness Compliance Requirement: Reporting Criteria Districts that received Education Stabilization Fund funding were required by the Arizona Department of Education to complete the “LEA Uses of ESSER I, II, & III – Use of Funds Detail” report by April 21, 2023. The report is based on fiscal year 2021‐22 financial information and full‐time equivalency (FTE) information. Condition Inadequate internal controls existed over the Education Stabilization Fund reporting processes. Cause The District has not developed nor implemented strong internal controls over reporting due to turnover in key finance positions. Effect The District is at risk of reporting inaccurate information. Context The District was unable to provide supporting documentation for the allocation of expenditures to the four categories in the report. In addition, the FTE reported as of September 30, 2022, did not agree to supporting documentation. Lastly, total FY22 ESSER III expenditures reported did not agree to accounting records by $106,755. Recommendation The District should develop or implement strong internal controls over reporting to reduce the risk of reporting inaccurate information. Views of Responsible Officials See Corrective Action Plan.