FAC Explorer

Audit 330083

FY End
2024-06-30
Total Expended
$22.86M
Findings
76
Programs
19
Organization: Ypsilanti Community Schools (MI)
Year: 2024 Accepted: 2024-11-26
Auditor: Yeo & Yeo Cpa's and Advisors

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
512337 2024-002 Material Weakness Yes P
512338 2024-004 Material Weakness Yes E
512339 2024-002 Material Weakness Yes P
512340 2024-004 Material Weakness Yes E
512341 2024-002 Material Weakness Yes P
512342 2024-002 Material Weakness Yes P
512343 2024-002 Material Weakness Yes P
512344 2024-002 Material Weakness Yes P
512345 2024-002 Material Weakness Yes P
512346 2024-004 Material Weakness Yes E
512347 2024-004 Material Weakness Yes E
512348 2024-004 Material Weakness Yes E
512349 2024-004 Material Weakness Yes E
512350 2024-004 Material Weakness Yes E
512351 2024-002 Material Weakness Yes P
512352 2024-004 Material Weakness Yes E
512353 2024-002 Material Weakness Yes P
512354 2024-002 Material Weakness Yes P
512355 2024-004 Material Weakness Yes E
512356 2024-004 Material Weakness Yes E
512357 2024-002 Material Weakness Yes P
512358 2024-002 Material Weakness Yes P
512359 2024-002 Material Weakness Yes P
512360 2024-002 Material Weakness Yes P
512361 2024-004 Material Weakness Yes E
512362 2024-004 Material Weakness Yes E
512363 2024-004 Material Weakness Yes E
512364 2024-004 Material Weakness Yes E
512365 2024-002 Material Weakness Yes P
512366 2024-002 Material Weakness Yes P
512367 2024-002 Material Weakness Yes P
512368 2024-002 Material Weakness Yes P
512369 2024-002 Material Weakness Yes P
512370 2024-005 Material Weakness - A
512371 2024-002 Material Weakness Yes P
512372 2024-002 Material Weakness Yes P
512373 2024-006 Material Weakness - A
512374 2024-006 Material Weakness - A
1088779 2024-002 Material Weakness Yes P
1088780 2024-004 Material Weakness Yes E
1088781 2024-002 Material Weakness Yes P
1088782 2024-004 Material Weakness Yes E
1088783 2024-002 Material Weakness Yes P
1088784 2024-002 Material Weakness Yes P
1088785 2024-002 Material Weakness Yes P
1088786 2024-002 Material Weakness Yes P
1088787 2024-002 Material Weakness Yes P
1088788 2024-004 Material Weakness Yes E
1088789 2024-004 Material Weakness Yes E
1088790 2024-004 Material Weakness Yes E
1088791 2024-004 Material Weakness Yes E
1088792 2024-004 Material Weakness Yes E
1088793 2024-002 Material Weakness Yes P
1088794 2024-004 Material Weakness Yes E
1088795 2024-002 Material Weakness Yes P
1088796 2024-002 Material Weakness Yes P
1088797 2024-004 Material Weakness Yes E
1088798 2024-004 Material Weakness Yes E
1088799 2024-002 Material Weakness Yes P
1088800 2024-002 Material Weakness Yes P
1088801 2024-002 Material Weakness Yes P
1088802 2024-002 Material Weakness Yes P
1088803 2024-004 Material Weakness Yes E
1088804 2024-004 Material Weakness Yes E
1088805 2024-004 Material Weakness Yes E
1088806 2024-004 Material Weakness Yes E
1088807 2024-002 Material Weakness Yes P
1088808 2024-002 Material Weakness Yes P
1088809 2024-002 Material Weakness Yes P
1088810 2024-002 Material Weakness Yes P
1088811 2024-002 Material Weakness Yes P
1088812 2024-005 Material Weakness - A
1088813 2024-002 Material Weakness Yes P
1088814 2024-002 Material Weakness Yes P
1088815 2024-006 Material Weakness - A
1088816 2024-006 Material Weakness - A

Programs

ALN Program Spent Major Findings
84.425 Education Stabilization Fund $7.02M Yes 1
84.010 Title I Grants to Local Educational Agencies $2.30M - 0
93.600 Head Start $2.19M Yes 2
10.555 National School Lunch Program $1.48M Yes 2
10.553 School Breakfast Program $706,381 Yes 2
84.374 Teacher and School Leader Incentive Grants (formerly the Teacher Incentive Fund) $610,335 - 0
84.215 Innovative Approaches to Literacy; Promise Neighborhoods; Full-Service Community Schools; and Congressionally Directed Spending for Elementary and Secondary Education Community Projects $386,811 Yes 2
84.165 Magnet Schools Assistance $383,008 - 0
84.027 Special Education Grants to States $271,338 - 0
84.367 Supporting Effective Instruction State Grants (formerly Improving Teacher Quality State Grants) $100,616 - 0
84.424 Student Support and Academic Enrichment Program $74,402 - 0
84.048 Career and Technical Education -- Basic Grants to States $70,915 - 0
10.582 Fresh Fruit and Vegetable Program $56,226 Yes 2
84.365 English Language Acquisition State Grants $45,078 - 0
10.185 Local Food for Schools Cooperative Agreement Program $34,267 - 0
10.559 Summer Food Service Program for Children $33,967 Yes 2
10.558 Child and Adult Care Food Program $17,253 Yes 2
10.579 Child Nutrition Discretionary Grants Limited Availability $10,000 - 0
84.173 Special Education Preschool Grants $3,836 - 0

Contacts

Name Title Type
XRMVYW6SYWG9 Damien Butler Auditee
7342211210 Timothy Crosson Jr. Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance where certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: Ypsilanti Community Schools 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 (the Schedule) includes the federal award activity of Ypsilanti Community Schools under programs of the federal government for the year ended June 30, 2024. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of Ypsilanti Community Schools, it is not intended to and does not present the financial position, changes in net assets, or cash flows of Ypsilanti Community Schools.
Title: Reconciliation to the Financial Statements Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance where certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: Ypsilanti Community Schools has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. See note 3 on Notes to the Schedule of Expenditures of Federal Awards for chart
Title: Subrecipients Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance where certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: Ypsilanti Community Schools has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. No amounts were provided to subrecipients
Title: Adjsutments to Schedule of Expenditures of Federal Awards Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance where certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: Ypsilanti Community Schools has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. The adjustment for English Language Acquisition State Grants on the Schedule in the amount of $1,125 is for accrued revenue at June 30, 2023 that was requested after the period of availability had expired and will not be paid by the passthrough grantor. The adjustment for COVID-19 98c Learning Loss Grant is for expenditures incurred at June 30, 2023 that were not included in the Schedule in the amount of $125,997 as due from other governments or unavailable revenue. The adjustment for School Breakfast Expansion is for expenditures incurred at June 30, 2023 that were not included in the Schedule in the amount of $10,000 as Federal revenue and due from other governments.
Title: Michigan Department of Education Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance where certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: Ypsilanti Community Schools has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. See note 6 on Notes to the Schedule of Expenditures of Federal Awards for chart

Finding Details

Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-005
Finding 2024-005 – Material Weakness and Material Noncompliance – Allowable Activities – Documentation of Payroll Distribution Program Name: Head Start Cluster – 93.600 Awarding Agency: U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $234,972 Context / Criteria: The School District should maintain internal controls to document salaries and wages that accurately reflect the work performed based on 2CF200.430(g). The internal controls should provide reasonable assurance that the charges are accurate, allowable and properly allocated as to account and period. Condition: The School District provided direct certifications as support for salaries and wages charged to the Head Start Cluster. The amounts charged to the Head Start Cluster did not agree with the direct certifications provided: there were 9 payroll charges that were not supported by a direct certification and 3 payroll charges where the provided direct certification percentage did not recalculate to the amount charged to the Head Start Cluster. Additionally, all direct certifications provided were signed June 7, 2024. Cause / Effect: Management has not developed or implemented a control to sufficiently accumulate and document the time spent on the Head Start Cluster. The lack of timely and accurate direct certifications could cause inaccuracies in financial reporting and overcharging of the Head Start Cluster. Employees could have potentially been charged to the Head Start Cluster that did not work on the grant and/or an inaccurate amount of their time could have been charged to the grant. Recommendation: We recommend management implement procedures to ensure direct certifications are completed in a timely manner for all employees working on the Head Start Cluster. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-006
Finding 2024-006 – Material Weakness and Noncompliance – Allowable Activities – Documentation of Payroll and Disbursement Classification Program Name: Literacy Excellence Accelerates Performance – 84.215G Awarding Agency: U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Noncompliance Questioned Cost Amount: $54,107 Context / Criteria: The School District should maintain internal controls to document disbursements and salaries and wages that accurately reflect the expenditures incurred and work performed based on Uniform Guidance. The internal controls should provide reasonable assurance that the charges are accurate, allowable, and properly allocated as to account and period. Condition: The School District’s support for the payroll and disbursements indicated that the incorrect account and object code was used. The School District expensed 4 of the sample of 40 for disbursement testing and 3 of the sample of 20 for payroll testing to the incorrect accounts. Additionally, it was noted the School District potentially overcharged the Retirement and FICA expenses compared to the School District’s school-wide rates. Cause / Effect: The School District is not appropriately labeling expenditures for posting and/or not appropriately reviewing expenditures compared to budget to prevent and identify errors. The lack of review for charges being posted to these accounts could result in the School District over or under-charging certain function or object codes compare to approved budgets. Recommendation: We recommend management implement procedures to ensure all expenditures are being allocated to the correct program, account and object code. A comparison of actual expenditures to budget may help identify and prevent misstatements to account for function, program and object codes. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-006
Finding 2024-006 – Material Weakness and Noncompliance – Allowable Activities – Documentation of Payroll and Disbursement Classification Program Name: Literacy Excellence Accelerates Performance – 84.215G Awarding Agency: U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Noncompliance Questioned Cost Amount: $54,107 Context / Criteria: The School District should maintain internal controls to document disbursements and salaries and wages that accurately reflect the expenditures incurred and work performed based on Uniform Guidance. The internal controls should provide reasonable assurance that the charges are accurate, allowable, and properly allocated as to account and period. Condition: The School District’s support for the payroll and disbursements indicated that the incorrect account and object code was used. The School District expensed 4 of the sample of 40 for disbursement testing and 3 of the sample of 20 for payroll testing to the incorrect accounts. Additionally, it was noted the School District potentially overcharged the Retirement and FICA expenses compared to the School District’s school-wide rates. Cause / Effect: The School District is not appropriately labeling expenditures for posting and/or not appropriately reviewing expenditures compared to budget to prevent and identify errors. The lack of review for charges being posted to these accounts could result in the School District over or under-charging certain function or object codes compare to approved budgets. Recommendation: We recommend management implement procedures to ensure all expenditures are being allocated to the correct program, account and object code. A comparison of actual expenditures to budget may help identify and prevent misstatements to account for function, program and object codes. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-004
Finding 2024-004, 2023-004 – Material Weakness and Material Noncompliance – Eligibility – Reimbursement Requests Program Name: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582 Child and Adult Care Food Program – 10.558 Awarding Agency: U.S. Department of Agriculture, passed through Michigan Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $134,482 for Child Nutrition Cluster $157,046 for Child and Adult Care Food Program Context / Criteria: The School District should request reimbursement for the actual number of meals served and should maintain support for the number of meals served for each reimbursement request. Condition: The School District’s support for the number of meals served did not agree to the meals requested on the reimbursement requests. Cause / Effect: The School District maintained paper records, but those meals served could not be reconciled or agreed to the reimbursement requests for 6 of our sample of 40 claims for Child Nutrition Cluster and 22 of our sample of 40 claims for Child and Adult Care Food Program. The lack of reconciliation or other records to explain the differences could have resulted in the School District over or under requesting reimbursement from Michigan Department of Education. Recommendation: We recommend management implement procedures to ensure meals served data is retained and communicated to the individual requesting reimbursement for meals served. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-005
Finding 2024-005 – Material Weakness and Material Noncompliance – Allowable Activities – Documentation of Payroll Distribution Program Name: Head Start Cluster – 93.600 Awarding Agency: U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: $234,972 Context / Criteria: The School District should maintain internal controls to document salaries and wages that accurately reflect the work performed based on 2CF200.430(g). The internal controls should provide reasonable assurance that the charges are accurate, allowable and properly allocated as to account and period. Condition: The School District provided direct certifications as support for salaries and wages charged to the Head Start Cluster. The amounts charged to the Head Start Cluster did not agree with the direct certifications provided: there were 9 payroll charges that were not supported by a direct certification and 3 payroll charges where the provided direct certification percentage did not recalculate to the amount charged to the Head Start Cluster. Additionally, all direct certifications provided were signed June 7, 2024. Cause / Effect: Management has not developed or implemented a control to sufficiently accumulate and document the time spent on the Head Start Cluster. The lack of timely and accurate direct certifications could cause inaccuracies in financial reporting and overcharging of the Head Start Cluster. Employees could have potentially been charged to the Head Start Cluster that did not work on the grant and/or an inaccurate amount of their time could have been charged to the grant. Recommendation: We recommend management implement procedures to ensure direct certifications are completed in a timely manner for all employees working on the Head Start Cluster. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-002
Finding 2024-002, 2023-002 – Material Weakness and Material Noncompliance – Budget Violations Program Name and Awarding Agency: Child Nutrition Cluster – 10.553, 10.555, 10.559, 10.582, U.S. Department of Agriculture, passed through Michigan Department of Education Child and Adult Care Food Program –10.558, U.S. Department of Agriculture, passed through Michigan Department of Education Education Stabilization Fund – 84.425D, 84.425V, 84.425W, 84.425U, U.S. Department of Education, passed through Michigan Department of Education Head Start Cluster – 93.600, U.S. Department of Health and Human Services, passed through Washtenaw Intermediate School District Literacy Excellence Accelerates Performance – 84.215G, U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Material Noncompliance Questioned Cost Amount: None Context / Criteria: The Michigan School Accounting Manual (Bulletin 1022) serves as a mandatory guide to the uniform classification and recording of accounting transactions for Michigan public school districts. Furthermore, the School shall not incur an expenditure against an appropriation account in excess of the amount authorized by the Board of Education. The School District is also responsible for comparing budget to actual expenses by function for programs. The School District should also import its original and final budgets into the accounting system to monitor spending and reduce errors in posting expenditures to the chart of accounts. Condition: The School District incurred material budget overages in multiple budgeted functions as adopted by the Board of Directors and disclosed in the June 30, 2024 financial statements. Additionally, total actual expenditures of $86,841,934 exceed total budgeted expenditures of $84,488,126 by $2,353,808 in the General Fund. The total actual expenditures of $3,648,070 exceed total budgeted expenditures of $2,792,958 by $855,112 in the Food Service Fund. No adopted budget was provided for the Student and School Activities Fund. The final budget also was not imported into the School District’s accounting software. We also found function and object codes used for disbursements and expenditures were inaccurate or not in accordance with approved budgets. Although the School District adopted an amended budget during the year, the amended budget did not change from the original budget. Cause / Effect: The budget was not properly monitored allowing the budget overages to exist. The School District has not established appropriate controls to ensure that the budget is monitored during the year and has overspent the Board-approved budget by a material amount. Additionally, the lack of budgets imported in the accounting software combined with the numerous federal and restricted state grants the School District receives increases the risk of the wrong account codes being used for expenditures which could have a material effect on reporting of Federal and restricted state grants. Recommendation: We recommend that the School District establish policies and procedures to ensure the budget is properly maintained and monitored throughout the year. An amended budget should be adopted throughout the year, as needed, to reflect changes in spending needs. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-006
Finding 2024-006 – Material Weakness and Noncompliance – Allowable Activities – Documentation of Payroll and Disbursement Classification Program Name: Literacy Excellence Accelerates Performance – 84.215G Awarding Agency: U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Noncompliance Questioned Cost Amount: $54,107 Context / Criteria: The School District should maintain internal controls to document disbursements and salaries and wages that accurately reflect the expenditures incurred and work performed based on Uniform Guidance. The internal controls should provide reasonable assurance that the charges are accurate, allowable, and properly allocated as to account and period. Condition: The School District’s support for the payroll and disbursements indicated that the incorrect account and object code was used. The School District expensed 4 of the sample of 40 for disbursement testing and 3 of the sample of 20 for payroll testing to the incorrect accounts. Additionally, it was noted the School District potentially overcharged the Retirement and FICA expenses compared to the School District’s school-wide rates. Cause / Effect: The School District is not appropriately labeling expenditures for posting and/or not appropriately reviewing expenditures compared to budget to prevent and identify errors. The lack of review for charges being posted to these accounts could result in the School District over or under-charging certain function or object codes compare to approved budgets. Recommendation: We recommend management implement procedures to ensure all expenditures are being allocated to the correct program, account and object code. A comparison of actual expenditures to budget may help identify and prevent misstatements to account for function, program and object codes. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.
Finding 2024-006
Finding 2024-006 – Material Weakness and Noncompliance – Allowable Activities – Documentation of Payroll and Disbursement Classification Program Name: Literacy Excellence Accelerates Performance – 84.215G Awarding Agency: U.S. Department of Education Finding Type: Material Weakness on Internal Controls over Compliance and Noncompliance Questioned Cost Amount: $54,107 Context / Criteria: The School District should maintain internal controls to document disbursements and salaries and wages that accurately reflect the expenditures incurred and work performed based on Uniform Guidance. The internal controls should provide reasonable assurance that the charges are accurate, allowable, and properly allocated as to account and period. Condition: The School District’s support for the payroll and disbursements indicated that the incorrect account and object code was used. The School District expensed 4 of the sample of 40 for disbursement testing and 3 of the sample of 20 for payroll testing to the incorrect accounts. Additionally, it was noted the School District potentially overcharged the Retirement and FICA expenses compared to the School District’s school-wide rates. Cause / Effect: The School District is not appropriately labeling expenditures for posting and/or not appropriately reviewing expenditures compared to budget to prevent and identify errors. The lack of review for charges being posted to these accounts could result in the School District over or under-charging certain function or object codes compare to approved budgets. Recommendation: We recommend management implement procedures to ensure all expenditures are being allocated to the correct program, account and object code. A comparison of actual expenditures to budget may help identify and prevent misstatements to account for function, program and object codes. Views of Responsible Officials and Corrective Actions: Management is in agreement with the finding. See accompanying corrective action plan.