FAC Explorer

Audit 323523

FY End
2023-06-30
Total Expended
$2.87M
Findings
2
Programs
13
Organization: Mount Carmel Area School District (PA)
Year: 2023 Accepted: 2024-10-01
Auditor: Klacik and Associates PC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
501236 2023-002 Material Weakness Yes P
1077678 2023-002 Material Weakness Yes P

Programs

ALN Program Spent Major Findings
84.010 Title I Grants to Local Educational Agencies $565,119 - 0
84.027 Special Education Grants to States $428,773 - 0
10.553 School Breakfast Program $309,050 Yes 0
10.555 National School Lunch Program $76,704 Yes 1
84.367 Supporting Effective Instruction State Grants (formerly Improving Teacher Quality State Grants) $66,109 - 0
10.582 Fresh Fruit and Vegetable Program $48,603 Yes 0
84.424 Student Support and Academic Enrichment Program $44,952 - 0
84.358 Rural Education $41,380 - 0
10.559 Summer Food Service Program for Children $9,874 Yes 0
93.778 Medical Assistance Program $7,142 - 0
84.173 Special Education Preschool Grants $6,347 - 0
84.425 Education Stabilization Fund $650 Yes 0
10.649 Pandemic Ebt Administrative Costs $628 Yes 0

Contacts

Name Title Type
UUR2LRYLBHE7 Corrina Lesko Auditee
5703391500 Anthony Gagliardi Auditor
No contacts on file

Notes to SEFA

Title: Basis of Accounting Accounting Policies: The accompanying Schedule is presented using the accrual basis of accounting. 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 (Uniform Guidance) where certain types of expenditures are not allowed or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The School District has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards and certain state grants includes the federal grant activity and certain grant activity of the Mount Carmel Area School District 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 (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), therefore, certain amounts presented in the schedule may differ from amounts presented in or used in the preparation of the basic financial statements. The accompanying Schedule of Expenditures of Federal Awards has been presented on the accrual basis of accounting. Expenditures are recorded, accordingly, when incurred rather than when paid. The Mount Carmel Area School District (the District) has received non-cash assistance during the year ended June 30, 2023 which is included in the Schedule of Expenditures of Federal Awards. The non-cash expenditures of $76,304 reported under CFDA No. 10.555, National School Lunch Program, represent the value of food commodity distributions calculated using the U.S. Department of Agriculture, Food and Nutrition Service Commodity Price List. These food commodities were received from the Pennsylvania Department of Agriculture, Bureau of Food Distribution for the year ended June 30, 2023.
Title: Summary of Significant Accounting Policies Accounting Policies: The accompanying Schedule is presented using the accrual basis of accounting. 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 (Uniform Guidance) where certain types of expenditures are not allowed or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The School District has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. The accompanying Schedule is presented using the accrual basis of accounting. 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 (Uniform Guidance) where certain types of expenditures are not allowed or are limited as to reimbursement.
Title: Additional Information Accounting Policies: The accompanying Schedule is presented using the accrual basis of accounting. 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 (Uniform Guidance) where certain types of expenditures are not allowed or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The School District has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. The School District did not have any subrecipients or pass any funds to subrecipients. The School District has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance.
Title: Categorization of Expenditures Accounting Policies: The accompanying Schedule is presented using the accrual basis of accounting. 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 (Uniform Guidance) where certain types of expenditures are not allowed or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The School District has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. The accompanying Schedule of Expenditures of Federal Awards reflects Federal expenditures for all programs which were active during the year. The categorization of expenditures included in the accompanying Schedule of Expenditures of Federal Awards is based on the Catalog of Federal Domestic Assistance (CFDA). Changes in the categorization of expenditures occur based on revisions to the CFDA, which are issued in June and December each year. The accompanying Schedule of Expenditures of Federal Awards reflects CFDA changes issued through August, including the compliance supplement addendum.
Title: Identification of Major Programs Accounting Policies: The accompanying Schedule is presented using the accrual basis of accounting. 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 (Uniform Guidance) where certain types of expenditures are not allowed or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The School District has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. As shown on the accompanying Schedule of Findings and Questioned Costs, the dollar threshold used to determine major programs was seven hundred fifty thousand dollars ($750,000). The District had the following major programs which were audited:

Finding Details

Finding 2023-002
Criteria: The District did not perform year end adjusting entries prior to the audit engagement, nor were they able to provide final financial statements without guidance from the auditor. No population was tested; finding is based upon understanding and review of the internal control system. Condition: During the current year, adjusting fund level journal entries and entity wide adjustments were proposed by the auditors and accepted by the District. In connection with the audit of the District's financial statements, management has requested that we assist in the drafting of the financial statemetns, required supplemetnary information, and related footnote disclosures. AU-C Section 265 entitled Communicating Internal Control Related Matters in an Audit, issued by the American Institute of Certified Public Accountants (AICPA) considers the need for significant adjusting journal entries and assistance when preparing the financial statements to be indicative of an internal control deficiency. Without assistance, the potential exists of teh District's financial statemetns not conforming to generally accepted accounting principles (GAAP). Cause: While the District's internal accounting personnel have the ability to interpret and understand its financial statements, both fund and entity wide, they do not have sufficient experience in preparing thsoe financials in accordance with GAAP. Effect: Greater opportunity for error in fiancial sreporting as the District's management has determined it is more cost-beneficial to utilize services of auditors to assist in drafting financial statements, as opposed to hiring a professional accountant trained in such matters. Effect: Greater opportunity for error in financial reporting as the District's management has determined it is more cost-beneficial to utilize services of auditors to assist in drafting financial statements, as opposed to hiring a professional accountant trained in such matters. Questioned Costs: Unknown. Recommendation: Management should establish a process to identify or communicate corrective actions to improve controls over financial reporting. Year-end closing procedures should be adopted by the District to ensure all activity and entries are recorded prior to the audit engagement.
Finding 2023-002
Criteria: The District did not perform year end adjusting entries prior to the audit engagement, nor were they able to provide final financial statements without guidance from the auditor. No population was tested; finding is based upon understanding and review of the internal control system. Condition: During the current year, adjusting fund level journal entries and entity wide adjustments were proposed by the auditors and accepted by the District. In connection with the audit of the District's financial statements, management has requested that we assist in the drafting of the financial statemetns, required supplemetnary information, and related footnote disclosures. AU-C Section 265 entitled Communicating Internal Control Related Matters in an Audit, issued by the American Institute of Certified Public Accountants (AICPA) considers the need for significant adjusting journal entries and assistance when preparing the financial statements to be indicative of an internal control deficiency. Without assistance, the potential exists of teh District's financial statemetns not conforming to generally accepted accounting principles (GAAP). Cause: While the District's internal accounting personnel have the ability to interpret and understand its financial statements, both fund and entity wide, they do not have sufficient experience in preparing thsoe financials in accordance with GAAP. Effect: Greater opportunity for error in fiancial sreporting as the District's management has determined it is more cost-beneficial to utilize services of auditors to assist in drafting financial statements, as opposed to hiring a professional accountant trained in such matters. Effect: Greater opportunity for error in financial reporting as the District's management has determined it is more cost-beneficial to utilize services of auditors to assist in drafting financial statements, as opposed to hiring a professional accountant trained in such matters. Questioned Costs: Unknown. Recommendation: Management should establish a process to identify or communicate corrective actions to improve controls over financial reporting. Year-end closing procedures should be adopted by the District to ensure all activity and entries are recorded prior to the audit engagement.