FAC Explorer

Audit 309236

FY End
2023-06-30
Total Expended
$10.13M
Findings
2
Programs
13
Organization: Magnolia School District (AR)
Year: 2023 Accepted: 2024-06-19
Auditor: Arkansas Legislative Audit

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
401245 2023-001 Material Weakness - FN
977687 2023-001 Material Weakness - FN

Programs

ALN Program Spent Major Findings
84.010 Title I Grants to Local Educational Agencies $1.41M - 0
10.553 School Breakfast Program $411,585 Yes 0
84.367 Supporting Effective Instruction State Grants $146,376 - 0
10.555 National School Lunch Program $127,849 Yes 0
84.424 Student Support and Academic Enrichment Program $126,744 - 0
84.358 Rural Education $116,775 - 0
84.371 Comprehensive Literacy Development $113,438 - 0
84.027 Special Education_grants to States $100,238 - 0
84.048 Career and Technical Education -- Basic Grants to States $83,595 - 0
84.173 Special Education_preschool Grants $62,060 - 0
10.582 Fresh Fruit and Vegetable Program $56,874 Yes 0
93.323 Epidemiology and Laboratory Capacity for Infectious Diseases (elc) $20,109 - 0
84.425 Covid-19 - Education Stabilization Fund $11,833 Yes 0

Contacts

Name Title Type
VN1UPY1RUN39 Carol Longino Auditee
8702344933 Matt Fink, CPA Auditor
No contacts on file

Notes to SEFA

Title: Medicaid Funding (SEFA Note 4) Accounting Policies: Basis of Presentation (SEFA Note 1) - The accompanying Schedule of Expenditures of Federal Awards (the "Schedule") includes the federal award activity of Magnolia School District No.14 (District) under programs of the federal government for the year ended June 30, 2023. 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 the District, it is not intended to and does not present the financial position or changes in financial position of the District. Summary of Significant Accounting Policies (SEFA Note 2) - Expenditures reported on the Schedule are reported on the regulatory 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. De Minimis Rate Used: N Rate Explanation: The District has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance (SEFA Note 3) During the year ended June 30, 2023, the District received Medicaid funding of $226,907 from the Arkansas Department of Human Services. Such payments are not considered Federal awards expended, and therefore, are not included in the above Schedule.
Title: Nonmonetary Assistance (SEFA Notes 5 and 6) Accounting Policies: Basis of Presentation (SEFA Note 1) - The accompanying Schedule of Expenditures of Federal Awards (the "Schedule") includes the federal award activity of Magnolia School District No.14 (District) under programs of the federal government for the year ended June 30, 2023. 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 the District, it is not intended to and does not present the financial position or changes in financial position of the District. Summary of Significant Accounting Policies (SEFA Note 2) - Expenditures reported on the Schedule are reported on the regulatory 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. De Minimis Rate Used: N Rate Explanation: The District has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance (SEFA Note 3) Nonmonetary assistance is reported at the approximate value as provided by the U. S. Department of Defense through an agreement with the U. S. Department of Agriculture. Nonmonetary assistance is reported at the approximate value as provided by the Arkansas Department of Human Services.

Finding Details

Finding 2023-001
U.S. DEPARTMENT OF EDUCATION PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION COVID-19 AMERICAN RESCUE PLAN - ELEMENTARY AND SECONDARY SCHOOL EMERGENCY RELIEF FUND - AL NUMBER 84.425U PASS-THROUGH NUMBER 1402 AUDIT PERIOD - YEAR ENDED JUNE 30, 2023 2023-001 Equipment and Real Property / Special Test and Provisions Criteria or specific requirement: 29 CFR 5.5 (Wage Rate Requirements) requires all contractors and subcontractors performing construction contracts in excess of $2,000, financed by federal assistance funds, to pay laborers and mechanics employed by the contractor or subcontractor not less than the prevailing wage rates as determined by the Department of Labor for the locality of the project. Non-federal entities shall include in the applicable construction contracts a provision that the contractor or subcontractor comply with those requirements. Such requirements include the submission of weekly certified payrolls for each week in which any contract work is performed, to the non-federal entities. Also, property records should be maintained for real property and improvements made to real property acquired with federal awards as specified in OMB 2 CFR section 200.311. Condition: The District paid $339,299 for the installation of flooring from the Education Stabilization Fund without obtaining a written contract that included the prevailing wage rate provision, and weekly certified payrolls were not submitted to the District. Additionally, the flooring project was not recorded in the District's capital asset subsidiary ledger. Cause: Lack of internal controls and management oversight. Effect or potential effect: The District did not comply with Wage Rate Requirements. The District's capital assets subsidiary records were not accurate. Context: An examination of the only capital improvement disbursement (totaling $339,229) paid from the Education Stabilization Fund. Identification as a repeat finding: No Recommendation: The District should contact the Arkansas Division of Elementary and Secondary Education (DESE) for guidance regarding this matter and implement proper controls over program expenditures. Views of responsible officials: The district will develop a check list to be used when projects are approved. The checklist will include making sure contracts are obtained when the project is being paid from a federal fund. In addition, it will note that weekly certified payrolls are to be submitted. Additional training will be provided to our Facilities Director on the Davis-Bacon Act. The district will adjust the current procedure for identifying expenditures which need to be included on capital asset inventory.
Finding 2023-001
U.S. DEPARTMENT OF EDUCATION PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION COVID-19 AMERICAN RESCUE PLAN - ELEMENTARY AND SECONDARY SCHOOL EMERGENCY RELIEF FUND - AL NUMBER 84.425U PASS-THROUGH NUMBER 1402 AUDIT PERIOD - YEAR ENDED JUNE 30, 2023 2023-001 Equipment and Real Property / Special Test and Provisions Criteria or specific requirement: 29 CFR 5.5 (Wage Rate Requirements) requires all contractors and subcontractors performing construction contracts in excess of $2,000, financed by federal assistance funds, to pay laborers and mechanics employed by the contractor or subcontractor not less than the prevailing wage rates as determined by the Department of Labor for the locality of the project. Non-federal entities shall include in the applicable construction contracts a provision that the contractor or subcontractor comply with those requirements. Such requirements include the submission of weekly certified payrolls for each week in which any contract work is performed, to the non-federal entities. Also, property records should be maintained for real property and improvements made to real property acquired with federal awards as specified in OMB 2 CFR section 200.311. Condition: The District paid $339,299 for the installation of flooring from the Education Stabilization Fund without obtaining a written contract that included the prevailing wage rate provision, and weekly certified payrolls were not submitted to the District. Additionally, the flooring project was not recorded in the District's capital asset subsidiary ledger. Cause: Lack of internal controls and management oversight. Effect or potential effect: The District did not comply with Wage Rate Requirements. The District's capital assets subsidiary records were not accurate. Context: An examination of the only capital improvement disbursement (totaling $339,229) paid from the Education Stabilization Fund. Identification as a repeat finding: No Recommendation: The District should contact the Arkansas Division of Elementary and Secondary Education (DESE) for guidance regarding this matter and implement proper controls over program expenditures. Views of responsible officials: The district will develop a check list to be used when projects are approved. The checklist will include making sure contracts are obtained when the project is being paid from a federal fund. In addition, it will note that weekly certified payrolls are to be submitted. Additional training will be provided to our Facilities Director on the Davis-Bacon Act. The district will adjust the current procedure for identifying expenditures which need to be included on capital asset inventory.