Audit 329351

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness in internal control over compliance Repeat Finding - No Criteria – Per 2 CFR § 200.303, The non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition – During our testing for Cash Management, it was noted that 4 out of 4 drawdowns requests selected for testing did not have evidence of review and approval. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – Management did not fully implement their internal control policies and procedures as there was no evidence of review and approvals, nor was documentation retained. Effect – Drawdown requests did not have evidence of review and approval. Recommendation – We recommend that management review its procedures and controls in place to ensure that reports and supporting documentation are retained and have proper evidence of review and approval. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness in internal control over compliance Repeat Finding - No Criteria – Per 2 CFR § 200.303, The non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition – During our testing for Reporting, it was noted that 1 out of 1 report selected for testing did not have evidence of review and approval. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – Management did not fully implement their internal control policies and procedures as there was no evidence of review and approvals, nor was documentation retained. Effect – Reports did not have evidence of review and approval. Recommendation – We recommend that management review its procedures and controls in place to ensure that reports and supporting documentation are retained and have proper evidence of review and approval. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness in internal control over compliance Repeat Finding - No Criteria – Per 2 CFR § 200.303, The non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition – During our testing for Activities Allowed or Unallowed, Allowable Costs/Cost Principles, it was noted that 2 out of 23 personnel selected for payroll testing were not included in the Madison-Carver Academy – Grant Funded Staff listing. In addition, we noted that 12 out of 23 personnel selected for testing did not contain evidence of review or approval of colleague assignment letters. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – Management did not fully implement their internal control policies and procedures as there was no evidence of review and approvals, nor was documentation retained. Effect – Reports did not have evidence of review and approval. Recommendation – We recommend that management review its procedures and controls in place to ensure that reports and supporting documentation are retained and have proper evidence of review and approval. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 and 2024 fiscal year were not reconciled or closed in a timely manner. The data collection forms were not submitted within the required time. Effect – Data collection forms were not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness in internal control over compliance Repeat Finding - No Criteria – Per 2 CFR § 200.303, The non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition – During our testing for Cash Management, it was noted that 4 out of 4 drawdowns requests selected for testing did not have evidence of review and approval. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – Management did not fully implement their internal control policies and procedures as there was no evidence of review and approvals, nor was documentation retained. Effect – Drawdown requests did not have evidence of review and approval. Recommendation – We recommend that management review its procedures and controls in place to ensure that reports and supporting documentation are retained and have proper evidence of review and approval. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness in internal control over compliance Repeat Finding - No Criteria – Per 2 CFR § 200.303, The non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition – During our testing for Reporting, it was noted that 1 out of 1 report selected for testing did not have evidence of review and approval. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – Management did not fully implement their internal control policies and procedures as there was no evidence of review and approvals, nor was documentation retained. Effect – Reports did not have evidence of review and approval. Recommendation – We recommend that management review its procedures and controls in place to ensure that reports and supporting documentation are retained and have proper evidence of review and approval. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness in internal control over compliance Repeat Finding - No Criteria – Per 2 CFR § 200.303, The non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition – During our testing for Activities Allowed or Unallowed, Allowable Costs/Cost Principles, it was noted that 2 out of 23 personnel selected for payroll testing were not included in the Madison-Carver Academy – Grant Funded Staff listing. In addition, we noted that 12 out of 23 personnel selected for testing did not contain evidence of review or approval of colleague assignment letters. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – Management did not fully implement their internal control policies and procedures as there was no evidence of review and approvals, nor was documentation retained. Effect – Reports did not have evidence of review and approval. Recommendation – We recommend that management review its procedures and controls in place to ensure that reports and supporting documentation are retained and have proper evidence of review and approval. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 and 2024 fiscal year were not reconciled or closed in a timely manner. The data collection forms were not submitted within the required time. Effect – Data collection forms were not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness in internal control over compliance Repeat Finding - No Criteria – Per 2 CFR § 200.303, The non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition – During our testing for Cash Management, it was noted that 4 out of 4 drawdowns requests selected for testing did not have evidence of review and approval. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – Management did not fully implement their internal control policies and procedures as there was no evidence of review and approvals, nor was documentation retained. Effect – Drawdown requests did not have evidence of review and approval. Recommendation – We recommend that management review its procedures and controls in place to ensure that reports and supporting documentation are retained and have proper evidence of review and approval. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness in internal control over compliance Repeat Finding - No Criteria – Per 2 CFR § 200.303, The non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition – During our testing for Reporting, it was noted that 1 out of 1 report selected for testing did not have evidence of review and approval. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – Management did not fully implement their internal control policies and procedures as there was no evidence of review and approvals, nor was documentation retained. Effect – Reports did not have evidence of review and approval. Recommendation – We recommend that management review its procedures and controls in place to ensure that reports and supporting documentation are retained and have proper evidence of review and approval. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness in internal control over compliance Repeat Finding - No Criteria – Per 2 CFR § 200.303, The non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition – During our testing for Activities Allowed or Unallowed, Allowable Costs/Cost Principles, it was noted that 2 out of 23 personnel selected for payroll testing were not included in the Madison-Carver Academy – Grant Funded Staff listing. In addition, we noted that 12 out of 23 personnel selected for testing did not contain evidence of review or approval of colleague assignment letters. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – Management did not fully implement their internal control policies and procedures as there was no evidence of review and approvals, nor was documentation retained. Effect – Reports did not have evidence of review and approval. Recommendation – We recommend that management review its procedures and controls in place to ensure that reports and supporting documentation are retained and have proper evidence of review and approval. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 and 2024 fiscal year were not reconciled or closed in a timely manner. The data collection forms were not submitted within the required time. Effect – Data collection forms were not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness in internal control over compliance Repeat Finding - No Criteria – Per 2 CFR § 200.303, The non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition – During our testing for Cash Management, it was noted that 4 out of 4 drawdowns requests selected for testing did not have evidence of review and approval. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – Management did not fully implement their internal control policies and procedures as there was no evidence of review and approvals, nor was documentation retained. Effect – Drawdown requests did not have evidence of review and approval. Recommendation – We recommend that management review its procedures and controls in place to ensure that reports and supporting documentation are retained and have proper evidence of review and approval. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness in internal control over compliance Repeat Finding - No Criteria – Per 2 CFR § 200.303, The non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition – During our testing for Reporting, it was noted that 1 out of 1 report selected for testing did not have evidence of review and approval. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – Management did not fully implement their internal control policies and procedures as there was no evidence of review and approvals, nor was documentation retained. Effect – Reports did not have evidence of review and approval. Recommendation – We recommend that management review its procedures and controls in place to ensure that reports and supporting documentation are retained and have proper evidence of review and approval. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness in internal control over compliance Repeat Finding - No Criteria – Per 2 CFR § 200.303, The non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition – During our testing for Activities Allowed or Unallowed, Allowable Costs/Cost Principles, it was noted that 2 out of 23 personnel selected for payroll testing were not included in the Madison-Carver Academy – Grant Funded Staff listing. In addition, we noted that 12 out of 23 personnel selected for testing did not contain evidence of review or approval of colleague assignment letters. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – Management did not fully implement their internal control policies and procedures as there was no evidence of review and approvals, nor was documentation retained. Effect – Reports did not have evidence of review and approval. Recommendation – We recommend that management review its procedures and controls in place to ensure that reports and supporting documentation are retained and have proper evidence of review and approval. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 and 2024 fiscal year were not reconciled or closed in a timely manner. The data collection forms were not submitted within the required time. Effect – Data collection forms were not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.