Finding Number: 2023-003
Repeat Finding: No.
Program Name/Assistance Listing Title: Indian School Equalization, Administrative Cost Grants for Indian
Schools
Assistance Listing Number: 15.042 | 15.046
Federal Agency: U.S. Department of the Interior
Federal Award Number: A22AV00848
Questioned Costs: 15.042: $2,028 | 15.046: $91,877
Type of Finding: Noncompliance, Material Weakness
Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles.
Criteria: Indian tribes and tribal organizations may, without the approval of the Bureau of Indian Affairs (BIA), expend funds provided under a self-determination contract for purposes identified in 25 USC 450j-l(k), to the extent that the expenditure of the funds is supportive of a contracted program (25 USC 450j-l(k)). These guidelines require internal controls over expenditures of federal monies, including the use of requisitions or purchase orders, to ensure expenditures comply with federal regulations and guidelines (25 CFR 39; 25 CFR 45; 25 CFR 900). Office of Management and Budget requires that non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with laws, regulations, and program compliance requirements. Control activities should include ensuring proper authorization of expenditures and reviews of operating performance. The School must ensure sufficient cash is available in cash-controlled funds prior to authorizing expenditures.
Condition: The School lacked adequate internal controls over its accounting of disbursements to ensure that a) all financial activities were properly processed and recorded and b) the School remained in compliance with federal requirements.
Effect: Noncompliance with federal regulation that led to a qualified audit opinion over the listed federal programs as noted above.
Cause: Management oversight.
Context: During our review of the School’s accounting records and internal controls, as well as through inquiry of management, we noted the following:
For eight of 25 accounts payable transactions tested out of the 15.042 grant, the School did provide adequate documentation to support the allowability of the expenditure.
For twenty-five of 25 accounts payable expenditures tested out of the 15.046 grant, the School paid amounts to and on-behalf of illegitimate board members, totaling $82,127.
For twenty-five of 25 payroll disbursements tested out of the 15.046 grant, the School paid board meeting stipends to illegitimate board members, totaling $9,750.
Recommendation: The School should develop and implement stronger internal controls over its accounting of disbursements to ensure that all financial activities are properly processed, recorded, and supported, and ensure that Governing Board monies are only paid out to and on-behalf of eligible individuals.
Response: The School concurs with this recommendation and will implement procedures to ensure compliance with federal regulation.
Contact person: Marie Rose, Principal
Finding Number: 2023-003
Repeat Finding: No.
Program Name/Assistance Listing Title: Indian School Equalization, Administrative Cost Grants for Indian
Schools
Assistance Listing Number: 15.042 | 15.046
Federal Agency: U.S. Department of the Interior
Federal Award Number: A22AV00848
Questioned Costs: 15.042: $2,028 | 15.046: $91,877
Type of Finding: Noncompliance, Material Weakness
Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles.
Criteria: Indian tribes and tribal organizations may, without the approval of the Bureau of Indian Affairs (BIA), expend funds provided under a self-determination contract for purposes identified in 25 USC 450j-l(k), to the extent that the expenditure of the funds is supportive of a contracted program (25 USC 450j-l(k)). These guidelines require internal controls over expenditures of federal monies, including the use of requisitions or purchase orders, to ensure expenditures comply with federal regulations and guidelines (25 CFR 39; 25 CFR 45; 25 CFR 900). Office of Management and Budget requires that non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with laws, regulations, and program compliance requirements. Control activities should include ensuring proper authorization of expenditures and reviews of operating performance. The School must ensure sufficient cash is available in cash-controlled funds prior to authorizing expenditures.
Condition: The School lacked adequate internal controls over its accounting of disbursements to ensure that a) all financial activities were properly processed and recorded and b) the School remained in compliance with federal requirements.
Effect: Noncompliance with federal regulation that led to a qualified audit opinion over the listed federal programs as noted above.
Cause: Management oversight.
Context: During our review of the School’s accounting records and internal controls, as well as through inquiry of management, we noted the following:
For eight of 25 accounts payable transactions tested out of the 15.042 grant, the School did provide adequate documentation to support the allowability of the expenditure.
For twenty-five of 25 accounts payable expenditures tested out of the 15.046 grant, the School paid amounts to and on-behalf of illegitimate board members, totaling $82,127.
For twenty-five of 25 payroll disbursements tested out of the 15.046 grant, the School paid board meeting stipends to illegitimate board members, totaling $9,750.
Recommendation: The School should develop and implement stronger internal controls over its accounting of disbursements to ensure that all financial activities are properly processed, recorded, and supported, and ensure that Governing Board monies are only paid out to and on-behalf of eligible individuals.
Response: The School concurs with this recommendation and will implement procedures to ensure compliance with federal regulation.
Contact person: Marie Rose, Principal
Finding Number: 2023-004
Repeat Finding: No.
Program Name/Assistance Listing Title: Indian School Equalization Program
Assistance Listing Number: 15.042
Federal Agency: U.S. Department of the Interior
Federal Award Number: A22AV00848
Questioned Costs: None
Type of Finding: Noncompliance, Material Weakness
Compliance Requirement: Reporting
Criteria: 2 CFR § 200.512(a) provides, in part: "The audit must be completed and the data collection form ... must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period."
2 CFR § 200.520 provides, in part: "That to qualify as a low-risk auditee and be eligible for reduced audit coverage the following condition must be met: Single audits were performed on an annual basis in accordance with the provisions of this Subpart, including submitting the data collection form and the reporting package to the FAC within the timeframe specified in § 200.512."
Condition: The School did submit their audit for the fiscal year ending June 30, 2023 timely. The audit was submitted December 6, 2024, which was 250 days past the March 31, 2024 deadline.
Effect: Not making all audit documentation available in a timely manner resulted in the audit and data collection form submissions to be late and, therefore, not available to the public within the required timeframe. This late submission also excludes the School from qualifying as a low-risk auditee.
Cause: Management oversight.
Recommendation: The School should implement procedures to ensure that all audit documentation is available for the audit in a timely manner and the audit report is completed and submitted within the appropriate timeframe.
Response: The School concurs with this recommendation and will implement procedures to ensure compliance with federal regulation.
Contact person: Marie Rose, Principal
Finding Number: 2023-003
Repeat Finding: No.
Program Name/Assistance Listing Title: Indian School Equalization, Administrative Cost Grants for Indian
Schools
Assistance Listing Number: 15.042 | 15.046
Federal Agency: U.S. Department of the Interior
Federal Award Number: A22AV00848
Questioned Costs: 15.042: $2,028 | 15.046: $91,877
Type of Finding: Noncompliance, Material Weakness
Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles.
Criteria: Indian tribes and tribal organizations may, without the approval of the Bureau of Indian Affairs (BIA), expend funds provided under a self-determination contract for purposes identified in 25 USC 450j-l(k), to the extent that the expenditure of the funds is supportive of a contracted program (25 USC 450j-l(k)). These guidelines require internal controls over expenditures of federal monies, including the use of requisitions or purchase orders, to ensure expenditures comply with federal regulations and guidelines (25 CFR 39; 25 CFR 45; 25 CFR 900). Office of Management and Budget requires that non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with laws, regulations, and program compliance requirements. Control activities should include ensuring proper authorization of expenditures and reviews of operating performance. The School must ensure sufficient cash is available in cash-controlled funds prior to authorizing expenditures.
Condition: The School lacked adequate internal controls over its accounting of disbursements to ensure that a) all financial activities were properly processed and recorded and b) the School remained in compliance with federal requirements.
Effect: Noncompliance with federal regulation that led to a qualified audit opinion over the listed federal programs as noted above.
Cause: Management oversight.
Context: During our review of the School’s accounting records and internal controls, as well as through inquiry of management, we noted the following:
For eight of 25 accounts payable transactions tested out of the 15.042 grant, the School did provide adequate documentation to support the allowability of the expenditure.
For twenty-five of 25 accounts payable expenditures tested out of the 15.046 grant, the School paid amounts to and on-behalf of illegitimate board members, totaling $82,127.
For twenty-five of 25 payroll disbursements tested out of the 15.046 grant, the School paid board meeting stipends to illegitimate board members, totaling $9,750.
Recommendation: The School should develop and implement stronger internal controls over its accounting of disbursements to ensure that all financial activities are properly processed, recorded, and supported, and ensure that Governing Board monies are only paid out to and on-behalf of eligible individuals.
Response: The School concurs with this recommendation and will implement procedures to ensure compliance with federal regulation.
Contact person: Marie Rose, Principal
Finding Number: 2023-003
Repeat Finding: No.
Program Name/Assistance Listing Title: Indian School Equalization, Administrative Cost Grants for Indian
Schools
Assistance Listing Number: 15.042 | 15.046
Federal Agency: U.S. Department of the Interior
Federal Award Number: A22AV00848
Questioned Costs: 15.042: $2,028 | 15.046: $91,877
Type of Finding: Noncompliance, Material Weakness
Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles.
Criteria: Indian tribes and tribal organizations may, without the approval of the Bureau of Indian Affairs (BIA), expend funds provided under a self-determination contract for purposes identified in 25 USC 450j-l(k), to the extent that the expenditure of the funds is supportive of a contracted program (25 USC 450j-l(k)). These guidelines require internal controls over expenditures of federal monies, including the use of requisitions or purchase orders, to ensure expenditures comply with federal regulations and guidelines (25 CFR 39; 25 CFR 45; 25 CFR 900). Office of Management and Budget requires that non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with laws, regulations, and program compliance requirements. Control activities should include ensuring proper authorization of expenditures and reviews of operating performance. The School must ensure sufficient cash is available in cash-controlled funds prior to authorizing expenditures.
Condition: The School lacked adequate internal controls over its accounting of disbursements to ensure that a) all financial activities were properly processed and recorded and b) the School remained in compliance with federal requirements.
Effect: Noncompliance with federal regulation that led to a qualified audit opinion over the listed federal programs as noted above.
Cause: Management oversight.
Context: During our review of the School’s accounting records and internal controls, as well as through inquiry of management, we noted the following:
For eight of 25 accounts payable transactions tested out of the 15.042 grant, the School did provide adequate documentation to support the allowability of the expenditure.
For twenty-five of 25 accounts payable expenditures tested out of the 15.046 grant, the School paid amounts to and on-behalf of illegitimate board members, totaling $82,127.
For twenty-five of 25 payroll disbursements tested out of the 15.046 grant, the School paid board meeting stipends to illegitimate board members, totaling $9,750.
Recommendation: The School should develop and implement stronger internal controls over its accounting of disbursements to ensure that all financial activities are properly processed, recorded, and supported, and ensure that Governing Board monies are only paid out to and on-behalf of eligible individuals.
Response: The School concurs with this recommendation and will implement procedures to ensure compliance with federal regulation.
Contact person: Marie Rose, Principal
Finding Number: 2023-004
Repeat Finding: No.
Program Name/Assistance Listing Title: Indian School Equalization Program
Assistance Listing Number: 15.042
Federal Agency: U.S. Department of the Interior
Federal Award Number: A22AV00848
Questioned Costs: None
Type of Finding: Noncompliance, Material Weakness
Compliance Requirement: Reporting
Criteria: 2 CFR § 200.512(a) provides, in part: "The audit must be completed and the data collection form ... must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period."
2 CFR § 200.520 provides, in part: "That to qualify as a low-risk auditee and be eligible for reduced audit coverage the following condition must be met: Single audits were performed on an annual basis in accordance with the provisions of this Subpart, including submitting the data collection form and the reporting package to the FAC within the timeframe specified in § 200.512."
Condition: The School did submit their audit for the fiscal year ending June 30, 2023 timely. The audit was submitted December 6, 2024, which was 250 days past the March 31, 2024 deadline.
Effect: Not making all audit documentation available in a timely manner resulted in the audit and data collection form submissions to be late and, therefore, not available to the public within the required timeframe. This late submission also excludes the School from qualifying as a low-risk auditee.
Cause: Management oversight.
Recommendation: The School should implement procedures to ensure that all audit documentation is available for the audit in a timely manner and the audit report is completed and submitted within the appropriate timeframe.
Response: The School concurs with this recommendation and will implement procedures to ensure compliance with federal regulation.
Contact person: Marie Rose, Principal