Audit 302355

FY End
2022-08-31
Total Expended
$11.05M
Findings
8
Programs
24
Organization: Aberdeen School District No. 5 (WA)
Year: 2022 Accepted: 2024-04-02

Organization Exclusion Status:

Checking exclusion status...

Findings

ID Ref Severity Repeat Requirement
392133 2022-001 Material Weakness - I
392134 2022-001 Material Weakness - I
392135 2022-001 Material Weakness - I
392136 2022-001 Material Weakness - I
968575 2022-001 Material Weakness - I
968576 2022-001 Material Weakness - I
968577 2022-001 Material Weakness - I
968578 2022-001 Material Weakness - I

Programs

ALN Program Spent Major Findings
10.553 School Breakfast Program $1.40M Yes 0
84.027 Special Education Grants to States $798,903 Yes 1
84.287 Twenty-First Century Community Learning Centers $505,939 - 0
84.027 Covid 19 - Special Education Grants to States $173,471 Yes 1
10.555 National School Lunch Program $154,801 Yes 0
84.367 Supporting Effective Instruction State Grants (formerly Improving Teacher Quality State Grants) $141,782 - 0
84.334 Gaining Early Awareness and Readiness for Undergraduate Programs $135,515 - 0
84.424 Student Support and Academic Enrichment Program $127,463 - 0
10.558 Child and Adult Care Food Program $106,182 - 0
84.011 Migrant Education State Grant Program $93,730 - 0
84.365 English Language Acquisition State Grants $76,636 - 0
10.559 Summer Food Service Program for Children $70,042 Yes 0
10.582 Fresh Fruit and Vegetable Program $60,817 Yes 0
84.358 Rural Education $59,679 - 0
84.060 Indian Education Grants to Local Educational Agencies $56,759 - 0
10.665 Schools and Roads - Grants to States $46,037 - 0
84.173 Special Education Preschool Grants $42,283 Yes 1
21.027 Covid 19 - Coronavirus State and Local Fiscal Recovery Funds $37,135 - 0
84.196 Education for Homeless Children and Youth $26,325 - 0
84.173 Covid 19 - Special Education Preschool Grants $14,525 Yes 1
84.425 Covid 19 - Education Stabilization Fund $4,936 Yes 0
10.649 Covid 19 - Pandemic Ebt Administrative Costs $3,063 - 0
84.010 Title I Grants to Local Educational Agencies $1,552 Yes 0
84.048 Career and Technical Education -- Basic Grants to States $1,550 - 0

Contacts

Name Title Type
KNQKL9KQBNJ7 Elyssa Louderback Auditee
3605382007 Lisa Carrell Auditor
No contacts on file

Notes to SEFA

Title: NOTE 1—BASIS OF ACCOUNTING Accounting Policies: The Schedule of Expenditures of Federal Awards is prepared on the same basis of accounting as the Aberdeen School District's financial statements. The Aberdeen School District uses the modified accrual basis of accounting. Expenditures represent only the federally funded portions of the program. District records should be consulted to determine amounts expended or matched from non-federal sources. De Minimis Rate Used: N Rate Explanation: The Aberdeen School District has not elected to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The (district) district used the federal restricted rate of 2.57% The Schedule of Expenditures of Federal Awards is prepared on the same basis of accounting as the Aberdeen School District's financial statements. The Aberdeen School District uses the modified accrual basis of accounting. Expenditures represent only the federally funded portions of the program. District records should be consulted to determine amounts expended or matched from non-federal sources.
Title: NOTE 2—FEDERAL DE MINIMIS INDIRECT RATE Accounting Policies: The Schedule of Expenditures of Federal Awards is prepared on the same basis of accounting as the Aberdeen School District's financial statements. The Aberdeen School District uses the modified accrual basis of accounting. Expenditures represent only the federally funded portions of the program. District records should be consulted to determine amounts expended or matched from non-federal sources. De Minimis Rate Used: N Rate Explanation: The Aberdeen School District has not elected to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The (district) district used the federal restricted rate of 2.57% The Aberdeen School District has not elected to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The (district) district used the federal restricted rate of 2.57%
Title: NOTE 3—PROGRAM COSTS/MATCHING CONTRIBUTIONS Accounting Policies: The Schedule of Expenditures of Federal Awards is prepared on the same basis of accounting as the Aberdeen School District's financial statements. The Aberdeen School District uses the modified accrual basis of accounting. Expenditures represent only the federally funded portions of the program. District records should be consulted to determine amounts expended or matched from non-federal sources. De Minimis Rate Used: N Rate Explanation: The Aberdeen School District has not elected to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The (district) district used the federal restricted rate of 2.57% The amounts shown as current year expenses represent only the federal award portion of the program costs. Entire program costs, including the Aberdeen School District’s local matching share, may be more than shown. Such expenditures are recognized following, the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Title: NOTE 4—NONCASH AWARDS Accounting Policies: The Schedule of Expenditures of Federal Awards is prepared on the same basis of accounting as the Aberdeen School District's financial statements. The Aberdeen School District uses the modified accrual basis of accounting. Expenditures represent only the federally funded portions of the program. District records should be consulted to determine amounts expended or matched from non-federal sources. De Minimis Rate Used: N Rate Explanation: The Aberdeen School District has not elected to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The (district) district used the federal restricted rate of 2.57% The amount of commodities reported on the schedule is the value of commodities distributed by the Aberdeen School District during the current year and priced as prescribed by OSPI.
Title: NOTE 5—SCHOOLWIDE PROGRAMS Accounting Policies: The Schedule of Expenditures of Federal Awards is prepared on the same basis of accounting as the Aberdeen School District's financial statements. The Aberdeen School District uses the modified accrual basis of accounting. Expenditures represent only the federally funded portions of the program. District records should be consulted to determine amounts expended or matched from non-federal sources. De Minimis Rate Used: N Rate Explanation: The Aberdeen School District has not elected to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The (district) district used the federal restricted rate of 2.57% The Aberdeen School District operates a “schoolwide program” in five elementary buildings, one junior high school, and one alternative school. Using federal funding, schoolwide programs are designed to upgrade an entire educational program within a school for all students, rather than limit services to certain targeted students. The following federal program amounts were expended by the Aberdeen School District in its schoolwide program: Title I (84.010) $1,643,804.
Title: NOTE 6—FEDERAL INDIRECT RATE Accounting Policies: The Schedule of Expenditures of Federal Awards is prepared on the same basis of accounting as the Aberdeen School District's financial statements. The Aberdeen School District uses the modified accrual basis of accounting. Expenditures represent only the federally funded portions of the program. District records should be consulted to determine amounts expended or matched from non-federal sources. De Minimis Rate Used: N Rate Explanation: The Aberdeen School District has not elected to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The (district) district used the federal restricted rate of 2.57% The Aberdeen School District used a fixed rate of 15.33% for this program.
Title: NOTE 7—FEDERAL INDIRECT RATE Accounting Policies: The Schedule of Expenditures of Federal Awards is prepared on the same basis of accounting as the Aberdeen School District's financial statements. The Aberdeen School District uses the modified accrual basis of accounting. Expenditures represent only the federally funded portions of the program. District records should be consulted to determine amounts expended or matched from non-federal sources. De Minimis Rate Used: N Rate Explanation: The Aberdeen School District has not elected to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The (district) district used the federal restricted rate of 2.57% The Aberdeen School District used a fixed rate of 1.54% for this program.
Title: Note 8 – UNDER-REPORTED 2021 FEDERAL EXPENDITURES Accounting Policies: The Schedule of Expenditures of Federal Awards is prepared on the same basis of accounting as the Aberdeen School District's financial statements. The Aberdeen School District uses the modified accrual basis of accounting. Expenditures represent only the federally funded portions of the program. District records should be consulted to determine amounts expended or matched from non-federal sources. De Minimis Rate Used: N Rate Explanation: The Aberdeen School District has not elected to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The (district) district used the federal restricted rate of 2.57% The following 2021 expenditures were erroneously omitted from the 2021 Schedule of Expenditures of Federal Awards. The expenditure has been included in the expenditure amounts reported on the 2022 Schedule of Expenditures of Federal Awards. • An amount of $8,719.28 expended in 2021 under ALN 84.425 "Education Stabilization Fund".

Finding Details

The District did not have adequate internal controls for ensuring compliance with federal procurement requirements. Assistance Listing Number and Title: 84.027 – Special Education Grants to States 84.027 – COVID-19 – Special Education Grants to States 84.173 – Special Education – Preschool Grants 84.173 – COVID-19 – Special Education Preschool Grants Federal Grantor Name: U.S. Department of Education Federal Award/Contract Number: N/A Pass-through Entity Name: Office of Superintendent of Public Instruction (OSPI) Pass-through Award/Contract Number: N/A Known Questioned Cost Amount: $0 Description of Condition During the 2021-2022 school year, the District spent $1,029,182 in Special Education program funds. The objective of the Special Education program is to help education agencies provide special education and related services to all children with disabilities. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding grant requirements and monitoring the effectiveness of established program controls. Federal regulations also require grant recipients to follow their own written procurement procedures, which must reflect the most restrictive of applicable federal, state or local laws. Federal regulations and District policy require the District to obtain price or rate quotes from an adequate number of sources for any services more than $10,000 but less than $250,000. For personal service contracts more than $250,000, the District must solicit sealed bids or competitive proposals. The District must also keep records to demonstrate compliance with these requirements. The District paid $345,952 and $65,860 for two personal service contracts using federal funds. Our audit found the District did not follow federal requirements and its own policy to procure personal services. We consider this deficiency in internal controls to be a material weakness that led to material noncompliance. The issue was not reported as a finding in the prior. Cause of Condition Management said they thought the District could rely on a request for proposal process and quotes it had received in a prior period for the contracts. Effect of Condition The District cannot demonstrate it received the best price for the services purchased and is not in compliance with federal requirements. Recommendation We recommend the District establish internal controls to ensure it follows the most restrictive procurement procedures when using federal funds to procure goods or services. Further, we recommend the District ensure it maintains documentation necessary to demonstrate compliance with these procurement requirements. District’s Response The district made best effort attempts to comply with the procurement guidance and has made changes in the process to fully comply in the future. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11. Title 2 CFR Part 200, Section 319 – Competition, establishes all procurement transactions are to be conducted in a manner providing full and open competition, and requires non-federal entities to have written procedures for procurement transactions. Title 2 CFR Part 200, Section 320 – Methods of procurement to be followed, describes each allowable procurement method.
The District did not have adequate internal controls for ensuring compliance with federal procurement requirements. Assistance Listing Number and Title: 84.027 – Special Education Grants to States 84.027 – COVID-19 – Special Education Grants to States 84.173 – Special Education – Preschool Grants 84.173 – COVID-19 – Special Education Preschool Grants Federal Grantor Name: U.S. Department of Education Federal Award/Contract Number: N/A Pass-through Entity Name: Office of Superintendent of Public Instruction (OSPI) Pass-through Award/Contract Number: N/A Known Questioned Cost Amount: $0 Description of Condition During the 2021-2022 school year, the District spent $1,029,182 in Special Education program funds. The objective of the Special Education program is to help education agencies provide special education and related services to all children with disabilities. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding grant requirements and monitoring the effectiveness of established program controls. Federal regulations also require grant recipients to follow their own written procurement procedures, which must reflect the most restrictive of applicable federal, state or local laws. Federal regulations and District policy require the District to obtain price or rate quotes from an adequate number of sources for any services more than $10,000 but less than $250,000. For personal service contracts more than $250,000, the District must solicit sealed bids or competitive proposals. The District must also keep records to demonstrate compliance with these requirements. The District paid $345,952 and $65,860 for two personal service contracts using federal funds. Our audit found the District did not follow federal requirements and its own policy to procure personal services. We consider this deficiency in internal controls to be a material weakness that led to material noncompliance. The issue was not reported as a finding in the prior. Cause of Condition Management said they thought the District could rely on a request for proposal process and quotes it had received in a prior period for the contracts. Effect of Condition The District cannot demonstrate it received the best price for the services purchased and is not in compliance with federal requirements. Recommendation We recommend the District establish internal controls to ensure it follows the most restrictive procurement procedures when using federal funds to procure goods or services. Further, we recommend the District ensure it maintains documentation necessary to demonstrate compliance with these procurement requirements. District’s Response The district made best effort attempts to comply with the procurement guidance and has made changes in the process to fully comply in the future. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11. Title 2 CFR Part 200, Section 319 – Competition, establishes all procurement transactions are to be conducted in a manner providing full and open competition, and requires non-federal entities to have written procedures for procurement transactions. Title 2 CFR Part 200, Section 320 – Methods of procurement to be followed, describes each allowable procurement method.
The District did not have adequate internal controls for ensuring compliance with federal procurement requirements. Assistance Listing Number and Title: 84.027 – Special Education Grants to States 84.027 – COVID-19 – Special Education Grants to States 84.173 – Special Education – Preschool Grants 84.173 – COVID-19 – Special Education Preschool Grants Federal Grantor Name: U.S. Department of Education Federal Award/Contract Number: N/A Pass-through Entity Name: Office of Superintendent of Public Instruction (OSPI) Pass-through Award/Contract Number: N/A Known Questioned Cost Amount: $0 Description of Condition During the 2021-2022 school year, the District spent $1,029,182 in Special Education program funds. The objective of the Special Education program is to help education agencies provide special education and related services to all children with disabilities. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding grant requirements and monitoring the effectiveness of established program controls. Federal regulations also require grant recipients to follow their own written procurement procedures, which must reflect the most restrictive of applicable federal, state or local laws. Federal regulations and District policy require the District to obtain price or rate quotes from an adequate number of sources for any services more than $10,000 but less than $250,000. For personal service contracts more than $250,000, the District must solicit sealed bids or competitive proposals. The District must also keep records to demonstrate compliance with these requirements. The District paid $345,952 and $65,860 for two personal service contracts using federal funds. Our audit found the District did not follow federal requirements and its own policy to procure personal services. We consider this deficiency in internal controls to be a material weakness that led to material noncompliance. The issue was not reported as a finding in the prior. Cause of Condition Management said they thought the District could rely on a request for proposal process and quotes it had received in a prior period for the contracts. Effect of Condition The District cannot demonstrate it received the best price for the services purchased and is not in compliance with federal requirements. Recommendation We recommend the District establish internal controls to ensure it follows the most restrictive procurement procedures when using federal funds to procure goods or services. Further, we recommend the District ensure it maintains documentation necessary to demonstrate compliance with these procurement requirements. District’s Response The district made best effort attempts to comply with the procurement guidance and has made changes in the process to fully comply in the future. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11. Title 2 CFR Part 200, Section 319 – Competition, establishes all procurement transactions are to be conducted in a manner providing full and open competition, and requires non-federal entities to have written procedures for procurement transactions. Title 2 CFR Part 200, Section 320 – Methods of procurement to be followed, describes each allowable procurement method.
The District did not have adequate internal controls for ensuring compliance with federal procurement requirements. Assistance Listing Number and Title: 84.027 – Special Education Grants to States 84.027 – COVID-19 – Special Education Grants to States 84.173 – Special Education – Preschool Grants 84.173 – COVID-19 – Special Education Preschool Grants Federal Grantor Name: U.S. Department of Education Federal Award/Contract Number: N/A Pass-through Entity Name: Office of Superintendent of Public Instruction (OSPI) Pass-through Award/Contract Number: N/A Known Questioned Cost Amount: $0 Description of Condition During the 2021-2022 school year, the District spent $1,029,182 in Special Education program funds. The objective of the Special Education program is to help education agencies provide special education and related services to all children with disabilities. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding grant requirements and monitoring the effectiveness of established program controls. Federal regulations also require grant recipients to follow their own written procurement procedures, which must reflect the most restrictive of applicable federal, state or local laws. Federal regulations and District policy require the District to obtain price or rate quotes from an adequate number of sources for any services more than $10,000 but less than $250,000. For personal service contracts more than $250,000, the District must solicit sealed bids or competitive proposals. The District must also keep records to demonstrate compliance with these requirements. The District paid $345,952 and $65,860 for two personal service contracts using federal funds. Our audit found the District did not follow federal requirements and its own policy to procure personal services. We consider this deficiency in internal controls to be a material weakness that led to material noncompliance. The issue was not reported as a finding in the prior. Cause of Condition Management said they thought the District could rely on a request for proposal process and quotes it had received in a prior period for the contracts. Effect of Condition The District cannot demonstrate it received the best price for the services purchased and is not in compliance with federal requirements. Recommendation We recommend the District establish internal controls to ensure it follows the most restrictive procurement procedures when using federal funds to procure goods or services. Further, we recommend the District ensure it maintains documentation necessary to demonstrate compliance with these procurement requirements. District’s Response The district made best effort attempts to comply with the procurement guidance and has made changes in the process to fully comply in the future. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11. Title 2 CFR Part 200, Section 319 – Competition, establishes all procurement transactions are to be conducted in a manner providing full and open competition, and requires non-federal entities to have written procedures for procurement transactions. Title 2 CFR Part 200, Section 320 – Methods of procurement to be followed, describes each allowable procurement method.
The District did not have adequate internal controls for ensuring compliance with federal procurement requirements. Assistance Listing Number and Title: 84.027 – Special Education Grants to States 84.027 – COVID-19 – Special Education Grants to States 84.173 – Special Education – Preschool Grants 84.173 – COVID-19 – Special Education Preschool Grants Federal Grantor Name: U.S. Department of Education Federal Award/Contract Number: N/A Pass-through Entity Name: Office of Superintendent of Public Instruction (OSPI) Pass-through Award/Contract Number: N/A Known Questioned Cost Amount: $0 Description of Condition During the 2021-2022 school year, the District spent $1,029,182 in Special Education program funds. The objective of the Special Education program is to help education agencies provide special education and related services to all children with disabilities. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding grant requirements and monitoring the effectiveness of established program controls. Federal regulations also require grant recipients to follow their own written procurement procedures, which must reflect the most restrictive of applicable federal, state or local laws. Federal regulations and District policy require the District to obtain price or rate quotes from an adequate number of sources for any services more than $10,000 but less than $250,000. For personal service contracts more than $250,000, the District must solicit sealed bids or competitive proposals. The District must also keep records to demonstrate compliance with these requirements. The District paid $345,952 and $65,860 for two personal service contracts using federal funds. Our audit found the District did not follow federal requirements and its own policy to procure personal services. We consider this deficiency in internal controls to be a material weakness that led to material noncompliance. The issue was not reported as a finding in the prior. Cause of Condition Management said they thought the District could rely on a request for proposal process and quotes it had received in a prior period for the contracts. Effect of Condition The District cannot demonstrate it received the best price for the services purchased and is not in compliance with federal requirements. Recommendation We recommend the District establish internal controls to ensure it follows the most restrictive procurement procedures when using federal funds to procure goods or services. Further, we recommend the District ensure it maintains documentation necessary to demonstrate compliance with these procurement requirements. District’s Response The district made best effort attempts to comply with the procurement guidance and has made changes in the process to fully comply in the future. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11. Title 2 CFR Part 200, Section 319 – Competition, establishes all procurement transactions are to be conducted in a manner providing full and open competition, and requires non-federal entities to have written procedures for procurement transactions. Title 2 CFR Part 200, Section 320 – Methods of procurement to be followed, describes each allowable procurement method.
The District did not have adequate internal controls for ensuring compliance with federal procurement requirements. Assistance Listing Number and Title: 84.027 – Special Education Grants to States 84.027 – COVID-19 – Special Education Grants to States 84.173 – Special Education – Preschool Grants 84.173 – COVID-19 – Special Education Preschool Grants Federal Grantor Name: U.S. Department of Education Federal Award/Contract Number: N/A Pass-through Entity Name: Office of Superintendent of Public Instruction (OSPI) Pass-through Award/Contract Number: N/A Known Questioned Cost Amount: $0 Description of Condition During the 2021-2022 school year, the District spent $1,029,182 in Special Education program funds. The objective of the Special Education program is to help education agencies provide special education and related services to all children with disabilities. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding grant requirements and monitoring the effectiveness of established program controls. Federal regulations also require grant recipients to follow their own written procurement procedures, which must reflect the most restrictive of applicable federal, state or local laws. Federal regulations and District policy require the District to obtain price or rate quotes from an adequate number of sources for any services more than $10,000 but less than $250,000. For personal service contracts more than $250,000, the District must solicit sealed bids or competitive proposals. The District must also keep records to demonstrate compliance with these requirements. The District paid $345,952 and $65,860 for two personal service contracts using federal funds. Our audit found the District did not follow federal requirements and its own policy to procure personal services. We consider this deficiency in internal controls to be a material weakness that led to material noncompliance. The issue was not reported as a finding in the prior. Cause of Condition Management said they thought the District could rely on a request for proposal process and quotes it had received in a prior period for the contracts. Effect of Condition The District cannot demonstrate it received the best price for the services purchased and is not in compliance with federal requirements. Recommendation We recommend the District establish internal controls to ensure it follows the most restrictive procurement procedures when using federal funds to procure goods or services. Further, we recommend the District ensure it maintains documentation necessary to demonstrate compliance with these procurement requirements. District’s Response The district made best effort attempts to comply with the procurement guidance and has made changes in the process to fully comply in the future. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11. Title 2 CFR Part 200, Section 319 – Competition, establishes all procurement transactions are to be conducted in a manner providing full and open competition, and requires non-federal entities to have written procedures for procurement transactions. Title 2 CFR Part 200, Section 320 – Methods of procurement to be followed, describes each allowable procurement method.
The District did not have adequate internal controls for ensuring compliance with federal procurement requirements. Assistance Listing Number and Title: 84.027 – Special Education Grants to States 84.027 – COVID-19 – Special Education Grants to States 84.173 – Special Education – Preschool Grants 84.173 – COVID-19 – Special Education Preschool Grants Federal Grantor Name: U.S. Department of Education Federal Award/Contract Number: N/A Pass-through Entity Name: Office of Superintendent of Public Instruction (OSPI) Pass-through Award/Contract Number: N/A Known Questioned Cost Amount: $0 Description of Condition During the 2021-2022 school year, the District spent $1,029,182 in Special Education program funds. The objective of the Special Education program is to help education agencies provide special education and related services to all children with disabilities. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding grant requirements and monitoring the effectiveness of established program controls. Federal regulations also require grant recipients to follow their own written procurement procedures, which must reflect the most restrictive of applicable federal, state or local laws. Federal regulations and District policy require the District to obtain price or rate quotes from an adequate number of sources for any services more than $10,000 but less than $250,000. For personal service contracts more than $250,000, the District must solicit sealed bids or competitive proposals. The District must also keep records to demonstrate compliance with these requirements. The District paid $345,952 and $65,860 for two personal service contracts using federal funds. Our audit found the District did not follow federal requirements and its own policy to procure personal services. We consider this deficiency in internal controls to be a material weakness that led to material noncompliance. The issue was not reported as a finding in the prior. Cause of Condition Management said they thought the District could rely on a request for proposal process and quotes it had received in a prior period for the contracts. Effect of Condition The District cannot demonstrate it received the best price for the services purchased and is not in compliance with federal requirements. Recommendation We recommend the District establish internal controls to ensure it follows the most restrictive procurement procedures when using federal funds to procure goods or services. Further, we recommend the District ensure it maintains documentation necessary to demonstrate compliance with these procurement requirements. District’s Response The district made best effort attempts to comply with the procurement guidance and has made changes in the process to fully comply in the future. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11. Title 2 CFR Part 200, Section 319 – Competition, establishes all procurement transactions are to be conducted in a manner providing full and open competition, and requires non-federal entities to have written procedures for procurement transactions. Title 2 CFR Part 200, Section 320 – Methods of procurement to be followed, describes each allowable procurement method.
The District did not have adequate internal controls for ensuring compliance with federal procurement requirements. Assistance Listing Number and Title: 84.027 – Special Education Grants to States 84.027 – COVID-19 – Special Education Grants to States 84.173 – Special Education – Preschool Grants 84.173 – COVID-19 – Special Education Preschool Grants Federal Grantor Name: U.S. Department of Education Federal Award/Contract Number: N/A Pass-through Entity Name: Office of Superintendent of Public Instruction (OSPI) Pass-through Award/Contract Number: N/A Known Questioned Cost Amount: $0 Description of Condition During the 2021-2022 school year, the District spent $1,029,182 in Special Education program funds. The objective of the Special Education program is to help education agencies provide special education and related services to all children with disabilities. Federal regulations require recipients to establish and maintain internal controls that ensure compliance with program requirements. These controls include understanding grant requirements and monitoring the effectiveness of established program controls. Federal regulations also require grant recipients to follow their own written procurement procedures, which must reflect the most restrictive of applicable federal, state or local laws. Federal regulations and District policy require the District to obtain price or rate quotes from an adequate number of sources for any services more than $10,000 but less than $250,000. For personal service contracts more than $250,000, the District must solicit sealed bids or competitive proposals. The District must also keep records to demonstrate compliance with these requirements. The District paid $345,952 and $65,860 for two personal service contracts using federal funds. Our audit found the District did not follow federal requirements and its own policy to procure personal services. We consider this deficiency in internal controls to be a material weakness that led to material noncompliance. The issue was not reported as a finding in the prior. Cause of Condition Management said they thought the District could rely on a request for proposal process and quotes it had received in a prior period for the contracts. Effect of Condition The District cannot demonstrate it received the best price for the services purchased and is not in compliance with federal requirements. Recommendation We recommend the District establish internal controls to ensure it follows the most restrictive procurement procedures when using federal funds to procure goods or services. Further, we recommend the District ensure it maintains documentation necessary to demonstrate compliance with these procurement requirements. District’s Response The district made best effort attempts to comply with the procurement guidance and has made changes in the process to fully comply in the future. Auditor’s Remarks We thank the District for its cooperation throughout the audit and the steps it is taking to address these concerns. We will review the status of the District’s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11. Title 2 CFR Part 200, Section 319 – Competition, establishes all procurement transactions are to be conducted in a manner providing full and open competition, and requires non-federal entities to have written procedures for procurement transactions. Title 2 CFR Part 200, Section 320 – Methods of procurement to be followed, describes each allowable procurement method.