Audit 343636

Program Information: U.S. Department of the Interior AL # Award Number Award Period Program Name 15.042 A19AV00888 7/1/2020-6/30/2021 Indian School Equalization Program 15.046 A19AV00888 7/1/2020-6/30/2021 Administrative Cost Grants for Indian Schools Criteria: The cost principles in 2 CFR part 200, subpart E (Cost Principles), prescribe the cost accounting requirements associated with the administration of Federal awards by: a. States, local governments, and Indian tribes b. Institutions of higher education (IHEs) c. Nonprofit organizations Except where otherwise authorized by statute, cost must meet the following general criteria in order to be allowable under Federal awards: 4. Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost. 7. Be adequately documented. 2 CFR § 200.303 - Internal controls states, the recipient and subrecipient must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During the testing of 15.042, the following was noted: • 1 of 8 non-payroll samples did not have sufficient supporting documentation. • 9 of 32 payroll samples did not have indication of management approval on the timesheet/timecard. • 5 of 32 payroll samples did not have a Personnel Action Form provided. • 1 of 32 payroll samples did not have management approval of the employee contract. • 1 of 32 payroll samples did not have sufficient supporting documentation. During the testing of 15.046, the following was noted: • Support was not provided for 2 of 30 non-payroll samples. • 1 of 3 Individually Important Items and 1 of 30 payroll samples did not have adequate documentation. • 4 of 30 payroll samples did not have an approved timesheet. [ X ] Compliance Finding [ ] Significant Deficiency [ X ] Material Weakness Cause: Due to turnover in key personnel and lack of internal controls, the School did not have the ability to provide supporting documentation. Effect: Without an effective internal control system an entity’s objective operations, reporting, and compliance, cannot be achieved. In addition, program funds could be expended on activities or costs that are deemed unallowable by the funding agency. Questioned Costs: $1,890 for 15.042, none for 15.046 as the known plus likely questioned costs did not exceed $25,000. Repeat Finding: No. Recommendation: We recommend the School enhances training for grant expenditures on federal cost allowability requirements, strengthen documentation & approval controls, and improve document retention practices. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.

Program Information: U.S. Department of the Interior AL # Award Number Award Period Program Name 15.042 A19AV00888 7/1/2020-6/30/2021 Indian School Equalization Program 15.046 A19AV00888 7/1/2020-6/30/2021 Administrative Cost Grants for Indian Schools Criteria: The cost principles in 2 CFR part 200, subpart E (Cost Principles), prescribe the cost accounting requirements associated with the administration of Federal awards by: a. States, local governments, and Indian tribes b. Institutions of higher education (IHEs) c. Nonprofit organizations Except where otherwise authorized by statute, cost must meet the following general criteria in order to be allowable under Federal awards: 4. Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost. 7. Be adequately documented. 2 CFR § 200.303 - Internal controls states, the recipient and subrecipient must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During the testing of 15.042, the following was noted: • 1 of 8 non-payroll samples did not have sufficient supporting documentation. • 9 of 32 payroll samples did not have indication of management approval on the timesheet/timecard. • 5 of 32 payroll samples did not have a Personnel Action Form provided. • 1 of 32 payroll samples did not have management approval of the employee contract. • 1 of 32 payroll samples did not have sufficient supporting documentation. During the testing of 15.046, the following was noted: • Support was not provided for 2 of 30 non-payroll samples. • 1 of 3 Individually Important Items and 1 of 30 payroll samples did not have adequate documentation. • 4 of 30 payroll samples did not have an approved timesheet. [ X ] Compliance Finding [ ] Significant Deficiency [ X ] Material Weakness Cause: Due to turnover in key personnel and lack of internal controls, the School did not have the ability to provide supporting documentation. Effect: Without an effective internal control system an entity’s objective operations, reporting, and compliance, cannot be achieved. In addition, program funds could be expended on activities or costs that are deemed unallowable by the funding agency. Questioned Costs: $1,890 for 15.042, none for 15.046 as the known plus likely questioned costs did not exceed $25,000. Repeat Finding: No. Recommendation: We recommend the School enhances training for grant expenditures on federal cost allowability requirements, strengthen documentation & approval controls, and improve document retention practices. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.

Program Information: U.S. Department of the Interior AL # Award Number Award Period Program Name 15.042 A19AV00888 7/1/2020-6/30/2021 Indian School Equalization Program Criteria: Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the Federal award identification number), who holds title, the acquisition date, cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)). A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)). A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 2 CFR § 200.303 - Internal controls states, the recipient and subrecipient must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During the audit, we noted that a physical inventory of the School’s property had not been taken and reconciled with the property records within the last two years. [ X ] Compliance Finding [ ] Significant Deficiency [ X ] Material Weakness Cause: There was turnover in the School’s key accounting staff. Effect: Property records may not be accurate and proper custodianship of the property is compromised. Questioned Costs: N/A. Repeat Finding: Yes, 2020-001. Recommendation: We recommend that the School develop policies and procedures requiring a physical inventory of the School’s property at least once every two years, and reconcile the results of the inventory to the property records. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.

Program Information: U.S. Department of the Interior AL # Award Number Award Period Program Name 15.042 A19AV00888 7/1/2020-6/30/2021 Indian School Equalization Program 15.046 A19AV00888 7/1/2020-6/30/2021 Administrative Cost Grants for Indian Schools Criteria: Non-Federal entities other than States, including those operating Federal programs as subrecipients of States, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable Federal statutes and the procurement requirements identified in 2 CFR part 200. During the review of the School’s procurement policies, the following was noted: • Any purchase of materials, supplies, or equipment having a purchase price exceeding $5,000 shall be purchased only after having requested at least three bids or as needed, advertised for sealed bids for a period of not less than five (5) days. Non-Federal entities other than States, including those operating Federal programs as subrecipients of States, must follow the suspension and debarment standards set out at 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension”, federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. 2 CFR § 200.303 - Internal controls states, the recipient and subrecipient must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During the testing of 15.042, the following was noted: • 1 of 1 Individually Important Items tested did not have bidding documentation or sole source justification. • 1 of 1 samples tested did not have bidding documentation or sole source justification. During the testing of 15.046, the following was noted: • 2 of 2 Individually Important Items and 2 of 2 procurement samples did not have bidding documentation or sole source justification. • 1 of 1 Individually Important Items and 1 of 1 suspension and debarment samples did not have verification that a suspension and debarment search was performed. [ X ] Compliance Finding [ ] Significant Deficiency [ X ] Material Weakness Cause: The School was not following its policies for purchases that exceed $5,000. For suspension and debarment, there were ineffective controls in place during the period, along with management oversight. Effect: The School could be overpaying for services or items that could be obtained elsewhere for less. The School could also be engaging with vendors who are suspended or debarred. Questioned Costs: Procurement: 15.042 – None reported as known and likely questioned costs did not exceed $25,000; 15.046 – Known – $75,425. Suspension and debarment: 15.042 and 15.046 – no questioned costs. Repeat Finding: Procurement – Yes, 2020-002 for 15.042; Suspension and Debarment – No Recommendation: We recommend that the School follow its written procurement policies and maintain proper supporting documentation. Additionally, we recommend the School develop procedures to ensure that before contracting with a vendor, a search is performed on https://www.sam.gov, a screen print of the search results is performed, and the results filed in the vendor’s file. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.

Program Information: U.S. Department of the Interior AL # Award Number Award Period Program Name 15.042 A19AV00888 7/1/2020-6/30/2021 Indian School Equalization Program 15.046 A19AV00888 7/1/2020-6/30/2021 Administrative Cost Grants for Indian Schools Criteria: Non-Federal entities other than States, including those operating Federal programs as subrecipients of States, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable Federal statutes and the procurement requirements identified in 2 CFR part 200. During the review of the School’s procurement policies, the following was noted: • Any purchase of materials, supplies, or equipment having a purchase price exceeding $5,000 shall be purchased only after having requested at least three bids or as needed, advertised for sealed bids for a period of not less than five (5) days. Non-Federal entities other than States, including those operating Federal programs as subrecipients of States, must follow the suspension and debarment standards set out at 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension”, federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. 2 CFR § 200.303 - Internal controls states, the recipient and subrecipient must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During the testing of 15.042, the following was noted: • 1 of 1 Individually Important Items tested did not have bidding documentation or sole source justification. • 1 of 1 samples tested did not have bidding documentation or sole source justification. During the testing of 15.046, the following was noted: • 2 of 2 Individually Important Items and 2 of 2 procurement samples did not have bidding documentation or sole source justification. • 1 of 1 Individually Important Items and 1 of 1 suspension and debarment samples did not have verification that a suspension and debarment search was performed. [ X ] Compliance Finding [ ] Significant Deficiency [ X ] Material Weakness Cause: The School was not following its policies for purchases that exceed $5,000. For suspension and debarment, there were ineffective controls in place during the period, along with management oversight. Effect: The School could be overpaying for services or items that could be obtained elsewhere for less. The School could also be engaging with vendors who are suspended or debarred. Questioned Costs: Procurement: 15.042 – None reported as known and likely questioned costs did not exceed $25,000; 15.046 – Known – $75,425. Suspension and debarment: 15.042 and 15.046 – no questioned costs. Repeat Finding: Procurement – Yes, 2020-002 for 15.042; Suspension and Debarment – No Recommendation: We recommend that the School follow its written procurement policies and maintain proper supporting documentation. Additionally, we recommend the School develop procedures to ensure that before contracting with a vendor, a search is performed on https://www.sam.gov, a screen print of the search results is performed, and the results filed in the vendor’s file. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.

Program Information: U.S. Department of the Interior AL # Award Number Award Period Program Name 15.046 A19AV00888 7/1/2020-6/30/2021 Administrative Cost Grants for Indian Schools Criteria: Per 25 U.S.C. § 2506(a) (1) (A), School Year 2019-2022 Reporting & Deadline Dates for Grant Schools, the following reports are required to be submitted: • Quarterly SF-425s – due 30 days after each period end. • Annual Report for School Year – due 9/30/21. • Year End Close Out SF-425s – tentative due 7/31/21, final due 9/30/21. • Program evaluation by an impartial third party such as an accrediting agency. 2 CFR § 200.303 - Internal controls states, the recipient and subrecipient must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During testing the following was noted: • 2 of 2 Close Out SF-425s were not provided for testing. • 1 of 2 Quarterly SF-425s was not submitted on time and 2 of 2 Quarterly SF-425s were not approved by signature. • The Annual Report for the School Year was not approved and timeliness could not be verified. [ X ] Compliance Finding [ ] Significant Deficiency [ X ] Material Weakness Cause: Staff turnover and management oversight resulted in reports not being submitted within the required timeline. Effect: The program may be subject to higher risk status and decreased funding due to failing to comply with the grant award requirements. Questioned Costs: N/A. Repeat Finding: No. Recommendation: We recommend the School adhere to the grant award’s requirements as documented and enforce monitoring procedures at the program level to ensure that compliance requirements are properly followed. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.

Program Information: U.S. Department of the Interior AL # Award Number Award Period Program Name 15.042 A19AV00888 7/1/2020-6/30/2021 Indian School Equalization Program Criteria: Character Investigations by Indian Tribes and Tribal Organizations Compliance Requirements: The Indian Child Protection and Family Violence Prevention Act (25 USC 3201 et seq.) requires Indian tribes and tribal organizations that receive funds under the ISDEAA or the Tribally Controlled Schools Act to conduct an investigation of the character of each individual who is employed or is being considered for employment by such Indian tribe or tribal organization in a position that involves regular contact with, or control over, Indian children. The Act further states that the Indian tribe or tribal organization may employ individuals in those positions only if the individuals meet standards of character, no less stringent than those prescribed under subpart B – Minimum Standards of Character and Suitability for Employment (25 CFR part 63), as the Indian tribe or tribal organization establishes. 2 CFR § 200.303 - Internal controls states, the recipient and subrecipient must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: For 4 of the 4 samples selected for testing, the School did not provide support for review and approval of the Character Investigations. [ ] Compliance Finding [ ] Significant Deficiency [ X ] Material Weakness Cause: Lack of internal controls and management oversight. Effect: Without an effective internal control system an entity’s objective: operations, reporting, and compliance cannot be achieved. Questioned Costs: N/A. Repeat Finding: Yes, 2020-003. Recommendation: We recommend that the School establish effective internal controls for the Character Investigations compliance requirement and adhere to the internal controls. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.

Program Information: U.S. Department of the Interior AL # Award Number Award Period Program Name 15.042 A19AV00888 7/1/2020-6/30/2021 Indian School Equalization Program 15.046 A19AV00888 7/1/2020-6/30/2021 Administrative Cost Grants for Indian Schools Criteria: The cost principles in 2 CFR part 200, subpart E (Cost Principles), prescribe the cost accounting requirements associated with the administration of Federal awards by: a. States, local governments, and Indian tribes b. Institutions of higher education (IHEs) c. Nonprofit organizations Except where otherwise authorized by statute, cost must meet the following general criteria in order to be allowable under Federal awards: 4. Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost. 7. Be adequately documented. 2 CFR § 200.303 - Internal controls states, the recipient and subrecipient must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During the testing of 15.042, the following was noted: • 1 of 8 non-payroll samples did not have sufficient supporting documentation. • 9 of 32 payroll samples did not have indication of management approval on the timesheet/timecard. • 5 of 32 payroll samples did not have a Personnel Action Form provided. • 1 of 32 payroll samples did not have management approval of the employee contract. • 1 of 32 payroll samples did not have sufficient supporting documentation. During the testing of 15.046, the following was noted: • Support was not provided for 2 of 30 non-payroll samples. • 1 of 3 Individually Important Items and 1 of 30 payroll samples did not have adequate documentation. • 4 of 30 payroll samples did not have an approved timesheet. [ X ] Compliance Finding [ ] Significant Deficiency [ X ] Material Weakness Cause: Due to turnover in key personnel and lack of internal controls, the School did not have the ability to provide supporting documentation. Effect: Without an effective internal control system an entity’s objective operations, reporting, and compliance, cannot be achieved. In addition, program funds could be expended on activities or costs that are deemed unallowable by the funding agency. Questioned Costs: $1,890 for 15.042, none for 15.046 as the known plus likely questioned costs did not exceed $25,000. Repeat Finding: No. Recommendation: We recommend the School enhances training for grant expenditures on federal cost allowability requirements, strengthen documentation & approval controls, and improve document retention practices. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.

Program Information: U.S. Department of the Interior AL # Award Number Award Period Program Name 15.042 A19AV00888 7/1/2020-6/30/2021 Indian School Equalization Program 15.046 A19AV00888 7/1/2020-6/30/2021 Administrative Cost Grants for Indian Schools Criteria: The cost principles in 2 CFR part 200, subpart E (Cost Principles), prescribe the cost accounting requirements associated with the administration of Federal awards by: a. States, local governments, and Indian tribes b. Institutions of higher education (IHEs) c. Nonprofit organizations Except where otherwise authorized by statute, cost must meet the following general criteria in order to be allowable under Federal awards: 4. Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost. 7. Be adequately documented. 2 CFR § 200.303 - Internal controls states, the recipient and subrecipient must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During the testing of 15.042, the following was noted: • 1 of 8 non-payroll samples did not have sufficient supporting documentation. • 9 of 32 payroll samples did not have indication of management approval on the timesheet/timecard. • 5 of 32 payroll samples did not have a Personnel Action Form provided. • 1 of 32 payroll samples did not have management approval of the employee contract. • 1 of 32 payroll samples did not have sufficient supporting documentation. During the testing of 15.046, the following was noted: • Support was not provided for 2 of 30 non-payroll samples. • 1 of 3 Individually Important Items and 1 of 30 payroll samples did not have adequate documentation. • 4 of 30 payroll samples did not have an approved timesheet. [ X ] Compliance Finding [ ] Significant Deficiency [ X ] Material Weakness Cause: Due to turnover in key personnel and lack of internal controls, the School did not have the ability to provide supporting documentation. Effect: Without an effective internal control system an entity’s objective operations, reporting, and compliance, cannot be achieved. In addition, program funds could be expended on activities or costs that are deemed unallowable by the funding agency. Questioned Costs: $1,890 for 15.042, none for 15.046 as the known plus likely questioned costs did not exceed $25,000. Repeat Finding: No. Recommendation: We recommend the School enhances training for grant expenditures on federal cost allowability requirements, strengthen documentation & approval controls, and improve document retention practices. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.

Program Information: U.S. Department of the Interior AL # Award Number Award Period Program Name 15.042 A19AV00888 7/1/2020-6/30/2021 Indian School Equalization Program Criteria: Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the Federal award identification number), who holds title, the acquisition date, cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)). A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)). A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 2 CFR § 200.303 - Internal controls states, the recipient and subrecipient must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During the audit, we noted that a physical inventory of the School’s property had not been taken and reconciled with the property records within the last two years. [ X ] Compliance Finding [ ] Significant Deficiency [ X ] Material Weakness Cause: There was turnover in the School’s key accounting staff. Effect: Property records may not be accurate and proper custodianship of the property is compromised. Questioned Costs: N/A. Repeat Finding: Yes, 2020-001. Recommendation: We recommend that the School develop policies and procedures requiring a physical inventory of the School’s property at least once every two years, and reconcile the results of the inventory to the property records. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.

Program Information: U.S. Department of the Interior AL # Award Number Award Period Program Name 15.042 A19AV00888 7/1/2020-6/30/2021 Indian School Equalization Program 15.046 A19AV00888 7/1/2020-6/30/2021 Administrative Cost Grants for Indian Schools Criteria: Non-Federal entities other than States, including those operating Federal programs as subrecipients of States, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable Federal statutes and the procurement requirements identified in 2 CFR part 200. During the review of the School’s procurement policies, the following was noted: • Any purchase of materials, supplies, or equipment having a purchase price exceeding $5,000 shall be purchased only after having requested at least three bids or as needed, advertised for sealed bids for a period of not less than five (5) days. Non-Federal entities other than States, including those operating Federal programs as subrecipients of States, must follow the suspension and debarment standards set out at 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension”, federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. 2 CFR § 200.303 - Internal controls states, the recipient and subrecipient must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During the testing of 15.042, the following was noted: • 1 of 1 Individually Important Items tested did not have bidding documentation or sole source justification. • 1 of 1 samples tested did not have bidding documentation or sole source justification. During the testing of 15.046, the following was noted: • 2 of 2 Individually Important Items and 2 of 2 procurement samples did not have bidding documentation or sole source justification. • 1 of 1 Individually Important Items and 1 of 1 suspension and debarment samples did not have verification that a suspension and debarment search was performed. [ X ] Compliance Finding [ ] Significant Deficiency [ X ] Material Weakness Cause: The School was not following its policies for purchases that exceed $5,000. For suspension and debarment, there were ineffective controls in place during the period, along with management oversight. Effect: The School could be overpaying for services or items that could be obtained elsewhere for less. The School could also be engaging with vendors who are suspended or debarred. Questioned Costs: Procurement: 15.042 – None reported as known and likely questioned costs did not exceed $25,000; 15.046 – Known – $75,425. Suspension and debarment: 15.042 and 15.046 – no questioned costs. Repeat Finding: Procurement – Yes, 2020-002 for 15.042; Suspension and Debarment – No Recommendation: We recommend that the School follow its written procurement policies and maintain proper supporting documentation. Additionally, we recommend the School develop procedures to ensure that before contracting with a vendor, a search is performed on https://www.sam.gov, a screen print of the search results is performed, and the results filed in the vendor’s file. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.

Program Information: U.S. Department of the Interior AL # Award Number Award Period Program Name 15.042 A19AV00888 7/1/2020-6/30/2021 Indian School Equalization Program 15.046 A19AV00888 7/1/2020-6/30/2021 Administrative Cost Grants for Indian Schools Criteria: Non-Federal entities other than States, including those operating Federal programs as subrecipients of States, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable Federal statutes and the procurement requirements identified in 2 CFR part 200. During the review of the School’s procurement policies, the following was noted: • Any purchase of materials, supplies, or equipment having a purchase price exceeding $5,000 shall be purchased only after having requested at least three bids or as needed, advertised for sealed bids for a period of not less than five (5) days. Non-Federal entities other than States, including those operating Federal programs as subrecipients of States, must follow the suspension and debarment standards set out at 2 CFR Part 180, which implements Executive Orders 12549 and 12689, “Debarment and Suspension”, federal awarding agency regulations in Title 2 of the CFR adopting/implementing the OMB guidance in 2 CFR Part 180; program legislation; and the terms and conditions of the award. 2 CFR § 200.303 - Internal controls states, the recipient and subrecipient must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During the testing of 15.042, the following was noted: • 1 of 1 Individually Important Items tested did not have bidding documentation or sole source justification. • 1 of 1 samples tested did not have bidding documentation or sole source justification. During the testing of 15.046, the following was noted: • 2 of 2 Individually Important Items and 2 of 2 procurement samples did not have bidding documentation or sole source justification. • 1 of 1 Individually Important Items and 1 of 1 suspension and debarment samples did not have verification that a suspension and debarment search was performed. [ X ] Compliance Finding [ ] Significant Deficiency [ X ] Material Weakness Cause: The School was not following its policies for purchases that exceed $5,000. For suspension and debarment, there were ineffective controls in place during the period, along with management oversight. Effect: The School could be overpaying for services or items that could be obtained elsewhere for less. The School could also be engaging with vendors who are suspended or debarred. Questioned Costs: Procurement: 15.042 – None reported as known and likely questioned costs did not exceed $25,000; 15.046 – Known – $75,425. Suspension and debarment: 15.042 and 15.046 – no questioned costs. Repeat Finding: Procurement – Yes, 2020-002 for 15.042; Suspension and Debarment – No Recommendation: We recommend that the School follow its written procurement policies and maintain proper supporting documentation. Additionally, we recommend the School develop procedures to ensure that before contracting with a vendor, a search is performed on https://www.sam.gov, a screen print of the search results is performed, and the results filed in the vendor’s file. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.

Program Information: U.S. Department of the Interior AL # Award Number Award Period Program Name 15.046 A19AV00888 7/1/2020-6/30/2021 Administrative Cost Grants for Indian Schools Criteria: Per 25 U.S.C. § 2506(a) (1) (A), School Year 2019-2022 Reporting & Deadline Dates for Grant Schools, the following reports are required to be submitted: • Quarterly SF-425s – due 30 days after each period end. • Annual Report for School Year – due 9/30/21. • Year End Close Out SF-425s – tentative due 7/31/21, final due 9/30/21. • Program evaluation by an impartial third party such as an accrediting agency. 2 CFR § 200.303 - Internal controls states, the recipient and subrecipient must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During testing the following was noted: • 2 of 2 Close Out SF-425s were not provided for testing. • 1 of 2 Quarterly SF-425s was not submitted on time and 2 of 2 Quarterly SF-425s were not approved by signature. • The Annual Report for the School Year was not approved and timeliness could not be verified. [ X ] Compliance Finding [ ] Significant Deficiency [ X ] Material Weakness Cause: Staff turnover and management oversight resulted in reports not being submitted within the required timeline. Effect: The program may be subject to higher risk status and decreased funding due to failing to comply with the grant award requirements. Questioned Costs: N/A. Repeat Finding: No. Recommendation: We recommend the School adhere to the grant award’s requirements as documented and enforce monitoring procedures at the program level to ensure that compliance requirements are properly followed. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.

Program Information: U.S. Department of the Interior AL # Award Number Award Period Program Name 15.042 A19AV00888 7/1/2020-6/30/2021 Indian School Equalization Program Criteria: Character Investigations by Indian Tribes and Tribal Organizations Compliance Requirements: The Indian Child Protection and Family Violence Prevention Act (25 USC 3201 et seq.) requires Indian tribes and tribal organizations that receive funds under the ISDEAA or the Tribally Controlled Schools Act to conduct an investigation of the character of each individual who is employed or is being considered for employment by such Indian tribe or tribal organization in a position that involves regular contact with, or control over, Indian children. The Act further states that the Indian tribe or tribal organization may employ individuals in those positions only if the individuals meet standards of character, no less stringent than those prescribed under subpart B – Minimum Standards of Character and Suitability for Employment (25 CFR part 63), as the Indian tribe or tribal organization establishes. 2 CFR § 200.303 - Internal controls states, the recipient and subrecipient must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: For 4 of the 4 samples selected for testing, the School did not provide support for review and approval of the Character Investigations. [ ] Compliance Finding [ ] Significant Deficiency [ X ] Material Weakness Cause: Lack of internal controls and management oversight. Effect: Without an effective internal control system an entity’s objective: operations, reporting, and compliance cannot be achieved. Questioned Costs: N/A. Repeat Finding: Yes, 2020-003. Recommendation: We recommend that the School establish effective internal controls for the Character Investigations compliance requirement and adhere to the internal controls. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.