Audit 353274

Criteria: The District is required to have internal controls in place that enable it to prepare complete financial statements, including the schedule of expenditure of federal awards in accordance with generally accepted accounting standards and in accordance with the Uniform Guidance at 2 CFR 200.510(b). Condition: The District did not record material federal grant income and expenses for the Coronavirus State and Local Fiscal Recovery Fund program in the correct period. Cause: The District failed to have internal controls to properly record all federal grant activity in the correct period and identify federal funds. Effect: The District did not record all federal grant income and expenses for the Coronavirus State and Local Fiscal Recovery Fund program in the correct period. The exclusion resulted in a material misstatement of contributed capital and construction in process. In addition, management engaged the auditor to prepare the schedule of expenditure of federal awards. Management reviewed, approved and accepted responsibility for the schedule of expenditure of federal awards prior to its issuance. Recommendation: We recommend that management review their procedures for identifying federal funds and recording federal funds in the proper period. In addition, we recommend that management review the costs and benefits involved to retain a consultant with the required expertise to prepare the schedule of expenditure of federal awards. Response: Management agrees with the finding and will review internal control procedures related to the recording of federal grant activity and cost to retain a consultant with the required expertise to prepare the schedule of expenditure of federal awards.

Criteria: The District is required to have internal controls in place that enable it to prepare complete financial statements, including the schedule of expenditure of federal awards in accordance with generally accepted accounting standards and in accordance with the Uniform Guidance at 2 CFR 200.510(b). Condition: The District did not record material federal grant income and expenses for the Coronavirus State and Local Fiscal Recovery Fund program in the correct period. Cause: The District failed to have internal controls to properly record all federal grant activity in the correct period and identify federal funds. Effect: The District did not record all federal grant income and expenses for the Coronavirus State and Local Fiscal Recovery Fund program in the correct period. The exclusion resulted in a material misstatement of contributed capital and construction in process. In addition, management engaged the auditor to prepare the schedule of expenditure of federal awards. Management reviewed, approved and accepted responsibility for the schedule of expenditure of federal awards prior to its issuance. Recommendation: We recommend that management review their procedures for identifying federal funds and recording federal funds in the proper period. In addition, we recommend that management review the costs and benefits involved to retain a consultant with the required expertise to prepare the schedule of expenditure of federal awards. Response: Management agrees with the finding and will review internal control procedures related to the recording of federal grant activity and cost to retain a consultant with the required expertise to prepare the schedule of expenditure of federal awards.