The District did not have adequate internal controls and did not
comply with time-and-effort and private school requirements.
Assistance Listing Number and Title: 84.010 – Title I Grants to Local
Educational Agencies
Federal Agency Name: U.S. Department of Education
Federal Award/Contract Number: N/A
Pass-through Entity Name: Office of Superintendent of Public
Instruction (OSPI)
Pass-through Award/Contract
Number: N/A
Questioned Cost Amount: $2,932,172
Prior Year Audit Finding: N/A
Background
The objective of the Title I program is to improve the teaching and learning of
children who are at risk of not meeting state academic standards and who live in
areas with high concentrations of children from low-income families. During the
2023-2024 school year, the District spent $2,932,172 in federal funds from the Title
I program.
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Time and Effort
The District is responsible for ensuring it supports all payroll costs it charges to the
program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the employee
completes the work.
Private Schools
Federal regulations require districts using Title I funds to consult with private
schools located within their boundaries to provide their eligible students, teachers
and families with equitable services. The District must maintain documentation
supporting that it contacted the private schools.
Description of Condition
Time and Effort
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and the Office of Superintendent of Public
Instruction (OSPI) require.
Private Schools
The District’s internal controls were ineffective for ensuring it consulted with
private schools within its boundaries to identify if students in the schools were
eligible to receive Title I services.
We consider these deficiencies in internal controls to be material weaknesses that
led to material noncompliance.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to locate supporting
documentation for time-and-effort or to indicate it contacted the private schools.
Effect of Condition and Questioned Costs
Time and Effort
The District did not obtain time-and-effort documentation for 235 employees
whose payroll and benefits costs totaling $2,932,172 were charged to the program.
Federal regulations require the State Auditor’s Office to report known questioned
costs that are greater than $25,000 for each type of compliance requirement. We
question costs when we find the District does not have adequate documentation to
support expenditures.
Private Schools
The District did not contact three private schools within its boundaries to determine
if there were eligible students that could have received Title I services. During our
audit, the District contacted all three private schools and one of them would have
been interested in participating if its students met eligibility requirements.
Recommendation
Time and Effort
We recommend the District establish and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
Private Schools
We recommend the District establish and follow internal controls to ensure it
complies with federal and OSPI requirements for contacting private schools within
its boundaries to determine whether eligible schools would like to participate in
Title I services.
District’s Response
The District concurs with the finding. In response, the District has established a
regularly updated list of private schools within our boundaries. We will be
proactively reaching out to these schools each year to determine interest and
eligibility for Title I services, and are documenting all correspondence. In addition,
we have strengthened time-and-effort documentation procedures as described in
2024-001. Our new internal controls include multi-layered reviews and program
director oversight to ensure timely, complete compliance. The District is committed
to equity in services and transparency in all federal programming.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
Title 34 CFR, Part 200, Title I – Improving the Academic Achievement of the
Disadvantaged, Subpart A – Improving Basic Programs Operated by Local
Education Agencies, Section 78 – Allocation of funds to school attendance areas
and schools
Title 34 CFR, Part 200, Title I – Improving the Academic Achievement of the
Disadvantaged, Subpart A – Improving Basic Programs Operated by Local
Education Agencies, Section 64 – Factors for determining equitable participation
of private school children
The District did not have adequate internal controls and did not
comply with time-and-effort and private school requirements.
Assistance Listing Number and Title: 84.010 – Title I Grants to Local
Educational Agencies
Federal Agency Name: U.S. Department of Education
Federal Award/Contract Number: N/A
Pass-through Entity Name: Office of Superintendent of Public
Instruction (OSPI)
Pass-through Award/Contract
Number: N/A
Questioned Cost Amount: $2,932,172
Prior Year Audit Finding: N/A
Background
The objective of the Title I program is to improve the teaching and learning of
children who are at risk of not meeting state academic standards and who live in
areas with high concentrations of children from low-income families. During the
2023-2024 school year, the District spent $2,932,172 in federal funds from the Title
I program.
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Time and Effort
The District is responsible for ensuring it supports all payroll costs it charges to the
program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the employee
completes the work.
Private Schools
Federal regulations require districts using Title I funds to consult with private
schools located within their boundaries to provide their eligible students, teachers
and families with equitable services. The District must maintain documentation
supporting that it contacted the private schools.
Description of Condition
Time and Effort
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and the Office of Superintendent of Public
Instruction (OSPI) require.
Private Schools
The District’s internal controls were ineffective for ensuring it consulted with
private schools within its boundaries to identify if students in the schools were
eligible to receive Title I services.
We consider these deficiencies in internal controls to be material weaknesses that
led to material noncompliance.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to locate supporting
documentation for time-and-effort or to indicate it contacted the private schools.
Effect of Condition and Questioned Costs
Time and Effort
The District did not obtain time-and-effort documentation for 235 employees
whose payroll and benefits costs totaling $2,932,172 were charged to the program.
Federal regulations require the State Auditor’s Office to report known questioned
costs that are greater than $25,000 for each type of compliance requirement. We
question costs when we find the District does not have adequate documentation to
support expenditures.
Private Schools
The District did not contact three private schools within its boundaries to determine
if there were eligible students that could have received Title I services. During our
audit, the District contacted all three private schools and one of them would have
been interested in participating if its students met eligibility requirements.
Recommendation
Time and Effort
We recommend the District establish and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
Private Schools
We recommend the District establish and follow internal controls to ensure it
complies with federal and OSPI requirements for contacting private schools within
its boundaries to determine whether eligible schools would like to participate in
Title I services.
District’s Response
The District concurs with the finding. In response, the District has established a
regularly updated list of private schools within our boundaries. We will be
proactively reaching out to these schools each year to determine interest and
eligibility for Title I services, and are documenting all correspondence. In addition,
we have strengthened time-and-effort documentation procedures as described in
2024-001. Our new internal controls include multi-layered reviews and program
director oversight to ensure timely, complete compliance. The District is committed
to equity in services and transparency in all federal programming.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
Title 34 CFR, Part 200, Title I – Improving the Academic Achievement of the
Disadvantaged, Subpart A – Improving Basic Programs Operated by Local
Education Agencies, Section 78 – Allocation of funds to school attendance areas
and schools
Title 34 CFR, Part 200, Title I – Improving the Academic Achievement of the
Disadvantaged, Subpart A – Improving Basic Programs Operated by Local
Education Agencies, Section 64 – Factors for determining equitable participation
of private school children
The District did not have adequate internal controls and did not
comply with time-and-effort and private school requirements.
Assistance Listing Number and Title: 84.010 – Title I Grants to Local
Educational Agencies
Federal Agency Name: U.S. Department of Education
Federal Award/Contract Number: N/A
Pass-through Entity Name: Office of Superintendent of Public
Instruction (OSPI)
Pass-through Award/Contract
Number: N/A
Questioned Cost Amount: $2,932,172
Prior Year Audit Finding: N/A
Background
The objective of the Title I program is to improve the teaching and learning of
children who are at risk of not meeting state academic standards and who live in
areas with high concentrations of children from low-income families. During the
2023-2024 school year, the District spent $2,932,172 in federal funds from the Title
I program.
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Time and Effort
The District is responsible for ensuring it supports all payroll costs it charges to the
program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the employee
completes the work.
Private Schools
Federal regulations require districts using Title I funds to consult with private
schools located within their boundaries to provide their eligible students, teachers
and families with equitable services. The District must maintain documentation
supporting that it contacted the private schools.
Description of Condition
Time and Effort
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and the Office of Superintendent of Public
Instruction (OSPI) require.
Private Schools
The District’s internal controls were ineffective for ensuring it consulted with
private schools within its boundaries to identify if students in the schools were
eligible to receive Title I services.
We consider these deficiencies in internal controls to be material weaknesses that
led to material noncompliance.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to locate supporting
documentation for time-and-effort or to indicate it contacted the private schools.
Effect of Condition and Questioned Costs
Time and Effort
The District did not obtain time-and-effort documentation for 235 employees
whose payroll and benefits costs totaling $2,932,172 were charged to the program.
Federal regulations require the State Auditor’s Office to report known questioned
costs that are greater than $25,000 for each type of compliance requirement. We
question costs when we find the District does not have adequate documentation to
support expenditures.
Private Schools
The District did not contact three private schools within its boundaries to determine
if there were eligible students that could have received Title I services. During our
audit, the District contacted all three private schools and one of them would have
been interested in participating if its students met eligibility requirements.
Recommendation
Time and Effort
We recommend the District establish and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
Private Schools
We recommend the District establish and follow internal controls to ensure it
complies with federal and OSPI requirements for contacting private schools within
its boundaries to determine whether eligible schools would like to participate in
Title I services.
District’s Response
The District concurs with the finding. In response, the District has established a
regularly updated list of private schools within our boundaries. We will be
proactively reaching out to these schools each year to determine interest and
eligibility for Title I services, and are documenting all correspondence. In addition,
we have strengthened time-and-effort documentation procedures as described in
2024-001. Our new internal controls include multi-layered reviews and program
director oversight to ensure timely, complete compliance. The District is committed
to equity in services and transparency in all federal programming.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
Title 34 CFR, Part 200, Title I – Improving the Academic Achievement of the
Disadvantaged, Subpart A – Improving Basic Programs Operated by Local
Education Agencies, Section 78 – Allocation of funds to school attendance areas
and schools
Title 34 CFR, Part 200, Title I – Improving the Academic Achievement of the
Disadvantaged, Subpart A – Improving Basic Programs Operated by Local
Education Agencies, Section 64 – Factors for determining equitable participation
of private school children
The District did not have adequate internal controls and did not
comply with time-and-effort and private school requirements.
Assistance Listing Number and Title: 84.010 – Title I Grants to Local
Educational Agencies
Federal Agency Name: U.S. Department of Education
Federal Award/Contract Number: N/A
Pass-through Entity Name: Office of Superintendent of Public
Instruction (OSPI)
Pass-through Award/Contract
Number: N/A
Questioned Cost Amount: $2,932,172
Prior Year Audit Finding: N/A
Background
The objective of the Title I program is to improve the teaching and learning of
children who are at risk of not meeting state academic standards and who live in
areas with high concentrations of children from low-income families. During the
2023-2024 school year, the District spent $2,932,172 in federal funds from the Title
I program.
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Time and Effort
The District is responsible for ensuring it supports all payroll costs it charges to the
program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the employee
completes the work.
Private Schools
Federal regulations require districts using Title I funds to consult with private
schools located within their boundaries to provide their eligible students, teachers
and families with equitable services. The District must maintain documentation
supporting that it contacted the private schools.
Description of Condition
Time and Effort
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and the Office of Superintendent of Public
Instruction (OSPI) require.
Private Schools
The District’s internal controls were ineffective for ensuring it consulted with
private schools within its boundaries to identify if students in the schools were
eligible to receive Title I services.
We consider these deficiencies in internal controls to be material weaknesses that
led to material noncompliance.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to locate supporting
documentation for time-and-effort or to indicate it contacted the private schools.
Effect of Condition and Questioned Costs
Time and Effort
The District did not obtain time-and-effort documentation for 235 employees
whose payroll and benefits costs totaling $2,932,172 were charged to the program.
Federal regulations require the State Auditor’s Office to report known questioned
costs that are greater than $25,000 for each type of compliance requirement. We
question costs when we find the District does not have adequate documentation to
support expenditures.
Private Schools
The District did not contact three private schools within its boundaries to determine
if there were eligible students that could have received Title I services. During our
audit, the District contacted all three private schools and one of them would have
been interested in participating if its students met eligibility requirements.
Recommendation
Time and Effort
We recommend the District establish and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
Private Schools
We recommend the District establish and follow internal controls to ensure it
complies with federal and OSPI requirements for contacting private schools within
its boundaries to determine whether eligible schools would like to participate in
Title I services.
District’s Response
The District concurs with the finding. In response, the District has established a
regularly updated list of private schools within our boundaries. We will be
proactively reaching out to these schools each year to determine interest and
eligibility for Title I services, and are documenting all correspondence. In addition,
we have strengthened time-and-effort documentation procedures as described in
2024-001. Our new internal controls include multi-layered reviews and program
director oversight to ensure timely, complete compliance. The District is committed
to equity in services and transparency in all federal programming.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
Title 34 CFR, Part 200, Title I – Improving the Academic Achievement of the
Disadvantaged, Subpart A – Improving Basic Programs Operated by Local
Education Agencies, Section 78 – Allocation of funds to school attendance areas
and schools
Title 34 CFR, Part 200, Title I – Improving the Academic Achievement of the
Disadvantaged, Subpart A – Improving Basic Programs Operated by Local
Education Agencies, Section 64 – Factors for determining equitable participation
of private school children
The District did not have adequate internal controls and did not
comply with time-and-effort requirements.
Assistance Listing Number and Title: 84.027, Special Education Grant to
States
84.173, Special Education
Preschool Grants
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number: N/A
Pass-through Entity Name: Office of Superintendent of Public
Instruction (OSPI)
Pass-through Award/Contract
Number:
84.027A-GT-0852;
84.173A-GT-0852;
84.173 – GT-1196
Known Questioned Cost Amount: $1,415,509
Prior Year Audit Finding: N/A
Background
During fiscal year 2024, the District spent $1,842,531 in federal funds from the
Special Education program cluster. This program ensures students with disabilities
receive free and appropriate public education with specially designed instruction
that addresses their unique needs.
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
The District is responsible for ensuring it supports all payroll costs it charges to the
program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after employees
complete the work.
If the District initially allocates payroll expenditures to federal programs based on
a budgeted or estimated time or amounts, then it must compare and adjust estimated
payroll time-and-effort records to actual time at least quarterly, if the difference is
10% or more. At year-end, payroll records must match time-and-effort
documentation to ensure the District only charges federal programs for work
directly supporting them.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and the Office of Superintendent of Public
Instruction (OSPI) require.
We consider this deficiency in internal controls to be a material weakness that led
to material noncompliance.
Cause of Condition
The District experienced turnover in key positions responsible for monitoring the
program. As a result, the current staff were unable to demonstrate former
employees dedicated the necessary time and resources to reconciling time charged
to the program and ensuring it was supported with time-and-effort documentation.
Effect of Condition and Questioned Costs
The District did not obtain time-and-effort documentation for 19 employees whose
payroll and benefit costs totaling $1,415,509 it charged to the program.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known questioned
costs that are greater than $25,000 for each type of compliance requirement. We
question costs when we find the District does not have adequate documentation to
support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges the finding and has implemented new procedures to
ensure strong internal controls over time-and-effort documentation. This issue
primarily occurred during a period of staff turnover. The District has since hired
experienced personnel who are now overseeing federal program compliance. We
have implemented a compliant time-and-effort tracking system consistent with
OSPI and federal requirements. Documentation—whether semiannual
certifications or monthly reports, as applicable—is collected, reviewed, and
retained in accordance with the type of funding allocation. All documentation is
reviewed by both the Business Office and program administrators to ensure
accuracy. Monthly monitoring and required training for relevant staff are now
embedded into our internal processes. The district is committed to ensuring
accuracy and accountability in all federally funded programs.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems
The District did not have adequate internal controls and did not
comply with time-and-effort requirements.
Assistance Listing Number and Title: 84.027, Special Education Grant to
States
84.173, Special Education
Preschool Grants
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number: N/A
Pass-through Entity Name: Office of Superintendent of Public
Instruction (OSPI)
Pass-through Award/Contract
Number:
84.027A-GT-0852;
84.173A-GT-0852;
84.173 – GT-1196
Known Questioned Cost Amount: $1,415,509
Prior Year Audit Finding: N/A
Background
During fiscal year 2024, the District spent $1,842,531 in federal funds from the
Special Education program cluster. This program ensures students with disabilities
receive free and appropriate public education with specially designed instruction
that addresses their unique needs.
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
The District is responsible for ensuring it supports all payroll costs it charges to the
program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after employees
complete the work.
If the District initially allocates payroll expenditures to federal programs based on
a budgeted or estimated time or amounts, then it must compare and adjust estimated
payroll time-and-effort records to actual time at least quarterly, if the difference is
10% or more. At year-end, payroll records must match time-and-effort
documentation to ensure the District only charges federal programs for work
directly supporting them.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and the Office of Superintendent of Public
Instruction (OSPI) require.
We consider this deficiency in internal controls to be a material weakness that led
to material noncompliance.
Cause of Condition
The District experienced turnover in key positions responsible for monitoring the
program. As a result, the current staff were unable to demonstrate former
employees dedicated the necessary time and resources to reconciling time charged
to the program and ensuring it was supported with time-and-effort documentation.
Effect of Condition and Questioned Costs
The District did not obtain time-and-effort documentation for 19 employees whose
payroll and benefit costs totaling $1,415,509 it charged to the program.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known questioned
costs that are greater than $25,000 for each type of compliance requirement. We
question costs when we find the District does not have adequate documentation to
support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges the finding and has implemented new procedures to
ensure strong internal controls over time-and-effort documentation. This issue
primarily occurred during a period of staff turnover. The District has since hired
experienced personnel who are now overseeing federal program compliance. We
have implemented a compliant time-and-effort tracking system consistent with
OSPI and federal requirements. Documentation—whether semiannual
certifications or monthly reports, as applicable—is collected, reviewed, and
retained in accordance with the type of funding allocation. All documentation is
reviewed by both the Business Office and program administrators to ensure
accuracy. Monthly monitoring and required training for relevant staff are now
embedded into our internal processes. The district is committed to ensuring
accuracy and accountability in all federally funded programs.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems
The District did not have adequate internal controls and did not
comply with time-and-effort requirements.
Assistance Listing Number and Title: 84.027, Special Education Grant to
States
84.173, Special Education
Preschool Grants
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number: N/A
Pass-through Entity Name: Office of Superintendent of Public
Instruction (OSPI)
Pass-through Award/Contract
Number:
84.027A-GT-0852;
84.173A-GT-0852;
84.173 – GT-1196
Known Questioned Cost Amount: $1,415,509
Prior Year Audit Finding: N/A
Background
During fiscal year 2024, the District spent $1,842,531 in federal funds from the
Special Education program cluster. This program ensures students with disabilities
receive free and appropriate public education with specially designed instruction
that addresses their unique needs.
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
The District is responsible for ensuring it supports all payroll costs it charges to the
program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after employees
complete the work.
If the District initially allocates payroll expenditures to federal programs based on
a budgeted or estimated time or amounts, then it must compare and adjust estimated
payroll time-and-effort records to actual time at least quarterly, if the difference is
10% or more. At year-end, payroll records must match time-and-effort
documentation to ensure the District only charges federal programs for work
directly supporting them.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and the Office of Superintendent of Public
Instruction (OSPI) require.
We consider this deficiency in internal controls to be a material weakness that led
to material noncompliance.
Cause of Condition
The District experienced turnover in key positions responsible for monitoring the
program. As a result, the current staff were unable to demonstrate former
employees dedicated the necessary time and resources to reconciling time charged
to the program and ensuring it was supported with time-and-effort documentation.
Effect of Condition and Questioned Costs
The District did not obtain time-and-effort documentation for 19 employees whose
payroll and benefit costs totaling $1,415,509 it charged to the program.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known questioned
costs that are greater than $25,000 for each type of compliance requirement. We
question costs when we find the District does not have adequate documentation to
support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges the finding and has implemented new procedures to
ensure strong internal controls over time-and-effort documentation. This issue
primarily occurred during a period of staff turnover. The District has since hired
experienced personnel who are now overseeing federal program compliance. We
have implemented a compliant time-and-effort tracking system consistent with
OSPI and federal requirements. Documentation—whether semiannual
certifications or monthly reports, as applicable—is collected, reviewed, and
retained in accordance with the type of funding allocation. All documentation is
reviewed by both the Business Office and program administrators to ensure
accuracy. Monthly monitoring and required training for relevant staff are now
embedded into our internal processes. The district is committed to ensuring
accuracy and accountability in all federally funded programs.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems
The District did not have adequate internal controls for ensuring
compliance with time-and-effort requirements.
Assistance Listing Number and Title: 84.425 – COVID-19 – Educational
Stabilization Fund
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number:
Pass-through Entity Name: Office of the Superintendent of
Public Instruction (OSPI)
Pass-through Award/Contract
Number:
84.425D-CEP Supp ESSER;
84.425U-138288; 84.425U-142142;
84.425U-145312; 84.425U-145823;
84.425V-6109; 84.425W-459563
Known Questioned Cost Amount: $47,853
Prior Year Audit Finding: N/A
Background
The objectives of the Education Stabilization Fund (ESF) program are to prevent,
prepare for and respond to the COVID-19 pandemic. In fiscal year 2024, the
District spent a total of $10,463,256 of its ESF awards. This included $191,184 in
the Elementary and Secondary School Emergency Relief Fund (ESSER II)
subprogram (84.425D), $10,099,901 in the American Rescue Plan Elementary and
Secondary School Emergency Relief (ARP ESSER/ESSER III) subprogram
(84.425U), $114,781 in the American Rescue Plan – Emergency Assistance to
Non-Public Schools (ARP EANS/EANS II) subprogram (84.425V) and $57,390 in
the American Rescue Plan Elementary and Secondary School Emergency Relief –
Homeless Children and Youth (ARP-HCY) subprogram (84.425W).
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Federal regulations also establish principles and standards for determining
allowable direct and indirect costs for federal awards. Additionally, federal
regulations and the Office of Superintendent of Public Instruction (OSPI) require
all costs charged to the program to comply with program requirements and
recipients to support this compliance with proper documentation that demonstrates
costs are allowable.
The District is also responsible for ensuring it supports all payroll costs charged to
the program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the work is
completed.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and OSPI require. Our audit found the
District transferred $47,853 of salary and benefit amounts to its ESSER III
(84.425U) award that were originally coded to other local, state and federal
programs, resulting in employees being charged to multiple federal programs
without appropriate time-and-effort documentation.
We consider this internal control deficiency to be a significant deficiency.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to find any documentation
showing time-and-effort had been collected.
Effect of Condition and Questioned Costs
Using a statistical sample of all journal entry transactions that included both
accounts payable and payroll disbursements, we found nine out of 29 transactions
we tested had exceptions. Those exceptions were related to salaries and benefits
totaling $47,853 that were not supported by time-and-effort documentation. Based
on the projection of our sample, we identified an additional $651,791 in estimated
unsupported costs.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known and likely
questioned costs that are more than $25,000 for each type of compliance
requirement. We question costs when we find the District does not have adequate
documentation to support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges this finding and has taken steps to address all time-andeffort
documentation issues. New procedures are now in place, including formal
time-and-effort tracking using the appropriate method—semiannual or monthly—
based on program guidelines and funding structure. The District has also
implemented a policy that requires all journal entries to include supporting
documentation. Each journal entry is reviewed and approved by multiple staff,
including Business Office staff and program directors, before posting. These
safeguards will ensure accountability, prevent future exceptions, and maintain
public trust.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303 Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, section 403, Factors affecting
allowability of costs, describes the cost principles for how direct and indirect costs
should be charged to federal programs.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
The District did not have adequate internal controls for ensuring
compliance with time-and-effort requirements.
Assistance Listing Number and Title: 84.425 – COVID-19 – Educational
Stabilization Fund
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number:
Pass-through Entity Name: Office of the Superintendent of
Public Instruction (OSPI)
Pass-through Award/Contract
Number:
84.425D-CEP Supp ESSER;
84.425U-138288; 84.425U-142142;
84.425U-145312; 84.425U-145823;
84.425V-6109; 84.425W-459563
Known Questioned Cost Amount: $47,853
Prior Year Audit Finding: N/A
Background
The objectives of the Education Stabilization Fund (ESF) program are to prevent,
prepare for and respond to the COVID-19 pandemic. In fiscal year 2024, the
District spent a total of $10,463,256 of its ESF awards. This included $191,184 in
the Elementary and Secondary School Emergency Relief Fund (ESSER II)
subprogram (84.425D), $10,099,901 in the American Rescue Plan Elementary and
Secondary School Emergency Relief (ARP ESSER/ESSER III) subprogram
(84.425U), $114,781 in the American Rescue Plan – Emergency Assistance to
Non-Public Schools (ARP EANS/EANS II) subprogram (84.425V) and $57,390 in
the American Rescue Plan Elementary and Secondary School Emergency Relief –
Homeless Children and Youth (ARP-HCY) subprogram (84.425W).
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Federal regulations also establish principles and standards for determining
allowable direct and indirect costs for federal awards. Additionally, federal
regulations and the Office of Superintendent of Public Instruction (OSPI) require
all costs charged to the program to comply with program requirements and
recipients to support this compliance with proper documentation that demonstrates
costs are allowable.
The District is also responsible for ensuring it supports all payroll costs charged to
the program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the work is
completed.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and OSPI require. Our audit found the
District transferred $47,853 of salary and benefit amounts to its ESSER III
(84.425U) award that were originally coded to other local, state and federal
programs, resulting in employees being charged to multiple federal programs
without appropriate time-and-effort documentation.
We consider this internal control deficiency to be a significant deficiency.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to find any documentation
showing time-and-effort had been collected.
Effect of Condition and Questioned Costs
Using a statistical sample of all journal entry transactions that included both
accounts payable and payroll disbursements, we found nine out of 29 transactions
we tested had exceptions. Those exceptions were related to salaries and benefits
totaling $47,853 that were not supported by time-and-effort documentation. Based
on the projection of our sample, we identified an additional $651,791 in estimated
unsupported costs.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known and likely
questioned costs that are more than $25,000 for each type of compliance
requirement. We question costs when we find the District does not have adequate
documentation to support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges this finding and has taken steps to address all time-andeffort
documentation issues. New procedures are now in place, including formal
time-and-effort tracking using the appropriate method—semiannual or monthly—
based on program guidelines and funding structure. The District has also
implemented a policy that requires all journal entries to include supporting
documentation. Each journal entry is reviewed and approved by multiple staff,
including Business Office staff and program directors, before posting. These
safeguards will ensure accountability, prevent future exceptions, and maintain
public trust.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303 Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, section 403, Factors affecting
allowability of costs, describes the cost principles for how direct and indirect costs
should be charged to federal programs.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
The District did not have adequate internal controls for ensuring
compliance with time-and-effort requirements.
Assistance Listing Number and Title: 84.425 – COVID-19 – Educational
Stabilization Fund
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number:
Pass-through Entity Name: Office of the Superintendent of
Public Instruction (OSPI)
Pass-through Award/Contract
Number:
84.425D-CEP Supp ESSER;
84.425U-138288; 84.425U-142142;
84.425U-145312; 84.425U-145823;
84.425V-6109; 84.425W-459563
Known Questioned Cost Amount: $47,853
Prior Year Audit Finding: N/A
Background
The objectives of the Education Stabilization Fund (ESF) program are to prevent,
prepare for and respond to the COVID-19 pandemic. In fiscal year 2024, the
District spent a total of $10,463,256 of its ESF awards. This included $191,184 in
the Elementary and Secondary School Emergency Relief Fund (ESSER II)
subprogram (84.425D), $10,099,901 in the American Rescue Plan Elementary and
Secondary School Emergency Relief (ARP ESSER/ESSER III) subprogram
(84.425U), $114,781 in the American Rescue Plan – Emergency Assistance to
Non-Public Schools (ARP EANS/EANS II) subprogram (84.425V) and $57,390 in
the American Rescue Plan Elementary and Secondary School Emergency Relief –
Homeless Children and Youth (ARP-HCY) subprogram (84.425W).
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Federal regulations also establish principles and standards for determining
allowable direct and indirect costs for federal awards. Additionally, federal
regulations and the Office of Superintendent of Public Instruction (OSPI) require
all costs charged to the program to comply with program requirements and
recipients to support this compliance with proper documentation that demonstrates
costs are allowable.
The District is also responsible for ensuring it supports all payroll costs charged to
the program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the work is
completed.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and OSPI require. Our audit found the
District transferred $47,853 of salary and benefit amounts to its ESSER III
(84.425U) award that were originally coded to other local, state and federal
programs, resulting in employees being charged to multiple federal programs
without appropriate time-and-effort documentation.
We consider this internal control deficiency to be a significant deficiency.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to find any documentation
showing time-and-effort had been collected.
Effect of Condition and Questioned Costs
Using a statistical sample of all journal entry transactions that included both
accounts payable and payroll disbursements, we found nine out of 29 transactions
we tested had exceptions. Those exceptions were related to salaries and benefits
totaling $47,853 that were not supported by time-and-effort documentation. Based
on the projection of our sample, we identified an additional $651,791 in estimated
unsupported costs.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known and likely
questioned costs that are more than $25,000 for each type of compliance
requirement. We question costs when we find the District does not have adequate
documentation to support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges this finding and has taken steps to address all time-andeffort
documentation issues. New procedures are now in place, including formal
time-and-effort tracking using the appropriate method—semiannual or monthly—
based on program guidelines and funding structure. The District has also
implemented a policy that requires all journal entries to include supporting
documentation. Each journal entry is reviewed and approved by multiple staff,
including Business Office staff and program directors, before posting. These
safeguards will ensure accountability, prevent future exceptions, and maintain
public trust.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303 Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, section 403, Factors affecting
allowability of costs, describes the cost principles for how direct and indirect costs
should be charged to federal programs.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
The District did not have adequate internal controls for ensuring
compliance with time-and-effort requirements.
Assistance Listing Number and Title: 84.425 – COVID-19 – Educational
Stabilization Fund
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number:
Pass-through Entity Name: Office of the Superintendent of
Public Instruction (OSPI)
Pass-through Award/Contract
Number:
84.425D-CEP Supp ESSER;
84.425U-138288; 84.425U-142142;
84.425U-145312; 84.425U-145823;
84.425V-6109; 84.425W-459563
Known Questioned Cost Amount: $47,853
Prior Year Audit Finding: N/A
Background
The objectives of the Education Stabilization Fund (ESF) program are to prevent,
prepare for and respond to the COVID-19 pandemic. In fiscal year 2024, the
District spent a total of $10,463,256 of its ESF awards. This included $191,184 in
the Elementary and Secondary School Emergency Relief Fund (ESSER II)
subprogram (84.425D), $10,099,901 in the American Rescue Plan Elementary and
Secondary School Emergency Relief (ARP ESSER/ESSER III) subprogram
(84.425U), $114,781 in the American Rescue Plan – Emergency Assistance to
Non-Public Schools (ARP EANS/EANS II) subprogram (84.425V) and $57,390 in
the American Rescue Plan Elementary and Secondary School Emergency Relief –
Homeless Children and Youth (ARP-HCY) subprogram (84.425W).
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Federal regulations also establish principles and standards for determining
allowable direct and indirect costs for federal awards. Additionally, federal
regulations and the Office of Superintendent of Public Instruction (OSPI) require
all costs charged to the program to comply with program requirements and
recipients to support this compliance with proper documentation that demonstrates
costs are allowable.
The District is also responsible for ensuring it supports all payroll costs charged to
the program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the work is
completed.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and OSPI require. Our audit found the
District transferred $47,853 of salary and benefit amounts to its ESSER III
(84.425U) award that were originally coded to other local, state and federal
programs, resulting in employees being charged to multiple federal programs
without appropriate time-and-effort documentation.
We consider this internal control deficiency to be a significant deficiency.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to find any documentation
showing time-and-effort had been collected.
Effect of Condition and Questioned Costs
Using a statistical sample of all journal entry transactions that included both
accounts payable and payroll disbursements, we found nine out of 29 transactions
we tested had exceptions. Those exceptions were related to salaries and benefits
totaling $47,853 that were not supported by time-and-effort documentation. Based
on the projection of our sample, we identified an additional $651,791 in estimated
unsupported costs.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known and likely
questioned costs that are more than $25,000 for each type of compliance
requirement. We question costs when we find the District does not have adequate
documentation to support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges this finding and has taken steps to address all time-andeffort
documentation issues. New procedures are now in place, including formal
time-and-effort tracking using the appropriate method—semiannual or monthly—
based on program guidelines and funding structure. The District has also
implemented a policy that requires all journal entries to include supporting
documentation. Each journal entry is reviewed and approved by multiple staff,
including Business Office staff and program directors, before posting. These
safeguards will ensure accountability, prevent future exceptions, and maintain
public trust.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303 Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, section 403, Factors affecting
allowability of costs, describes the cost principles for how direct and indirect costs
should be charged to federal programs.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
The District did not have adequate internal controls for ensuring
compliance with time-and-effort requirements.
Assistance Listing Number and Title: 84.425 – COVID-19 – Educational
Stabilization Fund
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number:
Pass-through Entity Name: Office of the Superintendent of
Public Instruction (OSPI)
Pass-through Award/Contract
Number:
84.425D-CEP Supp ESSER;
84.425U-138288; 84.425U-142142;
84.425U-145312; 84.425U-145823;
84.425V-6109; 84.425W-459563
Known Questioned Cost Amount: $47,853
Prior Year Audit Finding: N/A
Background
The objectives of the Education Stabilization Fund (ESF) program are to prevent,
prepare for and respond to the COVID-19 pandemic. In fiscal year 2024, the
District spent a total of $10,463,256 of its ESF awards. This included $191,184 in
the Elementary and Secondary School Emergency Relief Fund (ESSER II)
subprogram (84.425D), $10,099,901 in the American Rescue Plan Elementary and
Secondary School Emergency Relief (ARP ESSER/ESSER III) subprogram
(84.425U), $114,781 in the American Rescue Plan – Emergency Assistance to
Non-Public Schools (ARP EANS/EANS II) subprogram (84.425V) and $57,390 in
the American Rescue Plan Elementary and Secondary School Emergency Relief –
Homeless Children and Youth (ARP-HCY) subprogram (84.425W).
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Federal regulations also establish principles and standards for determining
allowable direct and indirect costs for federal awards. Additionally, federal
regulations and the Office of Superintendent of Public Instruction (OSPI) require
all costs charged to the program to comply with program requirements and
recipients to support this compliance with proper documentation that demonstrates
costs are allowable.
The District is also responsible for ensuring it supports all payroll costs charged to
the program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the work is
completed.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and OSPI require. Our audit found the
District transferred $47,853 of salary and benefit amounts to its ESSER III
(84.425U) award that were originally coded to other local, state and federal
programs, resulting in employees being charged to multiple federal programs
without appropriate time-and-effort documentation.
We consider this internal control deficiency to be a significant deficiency.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to find any documentation
showing time-and-effort had been collected.
Effect of Condition and Questioned Costs
Using a statistical sample of all journal entry transactions that included both
accounts payable and payroll disbursements, we found nine out of 29 transactions
we tested had exceptions. Those exceptions were related to salaries and benefits
totaling $47,853 that were not supported by time-and-effort documentation. Based
on the projection of our sample, we identified an additional $651,791 in estimated
unsupported costs.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known and likely
questioned costs that are more than $25,000 for each type of compliance
requirement. We question costs when we find the District does not have adequate
documentation to support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges this finding and has taken steps to address all time-andeffort
documentation issues. New procedures are now in place, including formal
time-and-effort tracking using the appropriate method—semiannual or monthly—
based on program guidelines and funding structure. The District has also
implemented a policy that requires all journal entries to include supporting
documentation. Each journal entry is reviewed and approved by multiple staff,
including Business Office staff and program directors, before posting. These
safeguards will ensure accountability, prevent future exceptions, and maintain
public trust.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303 Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, section 403, Factors affecting
allowability of costs, describes the cost principles for how direct and indirect costs
should be charged to federal programs.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
The District did not have adequate internal controls for ensuring
compliance with time-and-effort requirements.
Assistance Listing Number and Title: 84.425 – COVID-19 – Educational
Stabilization Fund
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number:
Pass-through Entity Name: Office of the Superintendent of
Public Instruction (OSPI)
Pass-through Award/Contract
Number:
84.425D-CEP Supp ESSER;
84.425U-138288; 84.425U-142142;
84.425U-145312; 84.425U-145823;
84.425V-6109; 84.425W-459563
Known Questioned Cost Amount: $47,853
Prior Year Audit Finding: N/A
Background
The objectives of the Education Stabilization Fund (ESF) program are to prevent,
prepare for and respond to the COVID-19 pandemic. In fiscal year 2024, the
District spent a total of $10,463,256 of its ESF awards. This included $191,184 in
the Elementary and Secondary School Emergency Relief Fund (ESSER II)
subprogram (84.425D), $10,099,901 in the American Rescue Plan Elementary and
Secondary School Emergency Relief (ARP ESSER/ESSER III) subprogram
(84.425U), $114,781 in the American Rescue Plan – Emergency Assistance to
Non-Public Schools (ARP EANS/EANS II) subprogram (84.425V) and $57,390 in
the American Rescue Plan Elementary and Secondary School Emergency Relief –
Homeless Children and Youth (ARP-HCY) subprogram (84.425W).
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Federal regulations also establish principles and standards for determining
allowable direct and indirect costs for federal awards. Additionally, federal
regulations and the Office of Superintendent of Public Instruction (OSPI) require
all costs charged to the program to comply with program requirements and
recipients to support this compliance with proper documentation that demonstrates
costs are allowable.
The District is also responsible for ensuring it supports all payroll costs charged to
the program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the work is
completed.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and OSPI require. Our audit found the
District transferred $47,853 of salary and benefit amounts to its ESSER III
(84.425U) award that were originally coded to other local, state and federal
programs, resulting in employees being charged to multiple federal programs
without appropriate time-and-effort documentation.
We consider this internal control deficiency to be a significant deficiency.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to find any documentation
showing time-and-effort had been collected.
Effect of Condition and Questioned Costs
Using a statistical sample of all journal entry transactions that included both
accounts payable and payroll disbursements, we found nine out of 29 transactions
we tested had exceptions. Those exceptions were related to salaries and benefits
totaling $47,853 that were not supported by time-and-effort documentation. Based
on the projection of our sample, we identified an additional $651,791 in estimated
unsupported costs.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known and likely
questioned costs that are more than $25,000 for each type of compliance
requirement. We question costs when we find the District does not have adequate
documentation to support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges this finding and has taken steps to address all time-andeffort
documentation issues. New procedures are now in place, including formal
time-and-effort tracking using the appropriate method—semiannual or monthly—
based on program guidelines and funding structure. The District has also
implemented a policy that requires all journal entries to include supporting
documentation. Each journal entry is reviewed and approved by multiple staff,
including Business Office staff and program directors, before posting. These
safeguards will ensure accountability, prevent future exceptions, and maintain
public trust.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303 Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, section 403, Factors affecting
allowability of costs, describes the cost principles for how direct and indirect costs
should be charged to federal programs.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
The District did not have adequate internal controls for ensuring
compliance with time-and-effort requirements.
Assistance Listing Number and Title: 84.425 – COVID-19 – Educational
Stabilization Fund
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number:
Pass-through Entity Name: Office of the Superintendent of
Public Instruction (OSPI)
Pass-through Award/Contract
Number:
84.425D-CEP Supp ESSER;
84.425U-138288; 84.425U-142142;
84.425U-145312; 84.425U-145823;
84.425V-6109; 84.425W-459563
Known Questioned Cost Amount: $47,853
Prior Year Audit Finding: N/A
Background
The objectives of the Education Stabilization Fund (ESF) program are to prevent,
prepare for and respond to the COVID-19 pandemic. In fiscal year 2024, the
District spent a total of $10,463,256 of its ESF awards. This included $191,184 in
the Elementary and Secondary School Emergency Relief Fund (ESSER II)
subprogram (84.425D), $10,099,901 in the American Rescue Plan Elementary and
Secondary School Emergency Relief (ARP ESSER/ESSER III) subprogram
(84.425U), $114,781 in the American Rescue Plan – Emergency Assistance to
Non-Public Schools (ARP EANS/EANS II) subprogram (84.425V) and $57,390 in
the American Rescue Plan Elementary and Secondary School Emergency Relief –
Homeless Children and Youth (ARP-HCY) subprogram (84.425W).
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Federal regulations also establish principles and standards for determining
allowable direct and indirect costs for federal awards. Additionally, federal
regulations and the Office of Superintendent of Public Instruction (OSPI) require
all costs charged to the program to comply with program requirements and
recipients to support this compliance with proper documentation that demonstrates
costs are allowable.
The District is also responsible for ensuring it supports all payroll costs charged to
the program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the work is
completed.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and OSPI require. Our audit found the
District transferred $47,853 of salary and benefit amounts to its ESSER III
(84.425U) award that were originally coded to other local, state and federal
programs, resulting in employees being charged to multiple federal programs
without appropriate time-and-effort documentation.
We consider this internal control deficiency to be a significant deficiency.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to find any documentation
showing time-and-effort had been collected.
Effect of Condition and Questioned Costs
Using a statistical sample of all journal entry transactions that included both
accounts payable and payroll disbursements, we found nine out of 29 transactions
we tested had exceptions. Those exceptions were related to salaries and benefits
totaling $47,853 that were not supported by time-and-effort documentation. Based
on the projection of our sample, we identified an additional $651,791 in estimated
unsupported costs.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known and likely
questioned costs that are more than $25,000 for each type of compliance
requirement. We question costs when we find the District does not have adequate
documentation to support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges this finding and has taken steps to address all time-andeffort
documentation issues. New procedures are now in place, including formal
time-and-effort tracking using the appropriate method—semiannual or monthly—
based on program guidelines and funding structure. The District has also
implemented a policy that requires all journal entries to include supporting
documentation. Each journal entry is reviewed and approved by multiple staff,
including Business Office staff and program directors, before posting. These
safeguards will ensure accountability, prevent future exceptions, and maintain
public trust.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303 Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, section 403, Factors affecting
allowability of costs, describes the cost principles for how direct and indirect costs
should be charged to federal programs.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
The District did not have adequate internal controls and did not
comply with time-and-effort and private school requirements.
Assistance Listing Number and Title: 84.010 – Title I Grants to Local
Educational Agencies
Federal Agency Name: U.S. Department of Education
Federal Award/Contract Number: N/A
Pass-through Entity Name: Office of Superintendent of Public
Instruction (OSPI)
Pass-through Award/Contract
Number: N/A
Questioned Cost Amount: $2,932,172
Prior Year Audit Finding: N/A
Background
The objective of the Title I program is to improve the teaching and learning of
children who are at risk of not meeting state academic standards and who live in
areas with high concentrations of children from low-income families. During the
2023-2024 school year, the District spent $2,932,172 in federal funds from the Title
I program.
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Time and Effort
The District is responsible for ensuring it supports all payroll costs it charges to the
program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the employee
completes the work.
Private Schools
Federal regulations require districts using Title I funds to consult with private
schools located within their boundaries to provide their eligible students, teachers
and families with equitable services. The District must maintain documentation
supporting that it contacted the private schools.
Description of Condition
Time and Effort
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and the Office of Superintendent of Public
Instruction (OSPI) require.
Private Schools
The District’s internal controls were ineffective for ensuring it consulted with
private schools within its boundaries to identify if students in the schools were
eligible to receive Title I services.
We consider these deficiencies in internal controls to be material weaknesses that
led to material noncompliance.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to locate supporting
documentation for time-and-effort or to indicate it contacted the private schools.
Effect of Condition and Questioned Costs
Time and Effort
The District did not obtain time-and-effort documentation for 235 employees
whose payroll and benefits costs totaling $2,932,172 were charged to the program.
Federal regulations require the State Auditor’s Office to report known questioned
costs that are greater than $25,000 for each type of compliance requirement. We
question costs when we find the District does not have adequate documentation to
support expenditures.
Private Schools
The District did not contact three private schools within its boundaries to determine
if there were eligible students that could have received Title I services. During our
audit, the District contacted all three private schools and one of them would have
been interested in participating if its students met eligibility requirements.
Recommendation
Time and Effort
We recommend the District establish and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
Private Schools
We recommend the District establish and follow internal controls to ensure it
complies with federal and OSPI requirements for contacting private schools within
its boundaries to determine whether eligible schools would like to participate in
Title I services.
District’s Response
The District concurs with the finding. In response, the District has established a
regularly updated list of private schools within our boundaries. We will be
proactively reaching out to these schools each year to determine interest and
eligibility for Title I services, and are documenting all correspondence. In addition,
we have strengthened time-and-effort documentation procedures as described in
2024-001. Our new internal controls include multi-layered reviews and program
director oversight to ensure timely, complete compliance. The District is committed
to equity in services and transparency in all federal programming.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
Title 34 CFR, Part 200, Title I – Improving the Academic Achievement of the
Disadvantaged, Subpart A – Improving Basic Programs Operated by Local
Education Agencies, Section 78 – Allocation of funds to school attendance areas
and schools
Title 34 CFR, Part 200, Title I – Improving the Academic Achievement of the
Disadvantaged, Subpart A – Improving Basic Programs Operated by Local
Education Agencies, Section 64 – Factors for determining equitable participation
of private school children
The District did not have adequate internal controls and did not
comply with time-and-effort and private school requirements.
Assistance Listing Number and Title: 84.010 – Title I Grants to Local
Educational Agencies
Federal Agency Name: U.S. Department of Education
Federal Award/Contract Number: N/A
Pass-through Entity Name: Office of Superintendent of Public
Instruction (OSPI)
Pass-through Award/Contract
Number: N/A
Questioned Cost Amount: $2,932,172
Prior Year Audit Finding: N/A
Background
The objective of the Title I program is to improve the teaching and learning of
children who are at risk of not meeting state academic standards and who live in
areas with high concentrations of children from low-income families. During the
2023-2024 school year, the District spent $2,932,172 in federal funds from the Title
I program.
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Time and Effort
The District is responsible for ensuring it supports all payroll costs it charges to the
program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the employee
completes the work.
Private Schools
Federal regulations require districts using Title I funds to consult with private
schools located within their boundaries to provide their eligible students, teachers
and families with equitable services. The District must maintain documentation
supporting that it contacted the private schools.
Description of Condition
Time and Effort
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and the Office of Superintendent of Public
Instruction (OSPI) require.
Private Schools
The District’s internal controls were ineffective for ensuring it consulted with
private schools within its boundaries to identify if students in the schools were
eligible to receive Title I services.
We consider these deficiencies in internal controls to be material weaknesses that
led to material noncompliance.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to locate supporting
documentation for time-and-effort or to indicate it contacted the private schools.
Effect of Condition and Questioned Costs
Time and Effort
The District did not obtain time-and-effort documentation for 235 employees
whose payroll and benefits costs totaling $2,932,172 were charged to the program.
Federal regulations require the State Auditor’s Office to report known questioned
costs that are greater than $25,000 for each type of compliance requirement. We
question costs when we find the District does not have adequate documentation to
support expenditures.
Private Schools
The District did not contact three private schools within its boundaries to determine
if there were eligible students that could have received Title I services. During our
audit, the District contacted all three private schools and one of them would have
been interested in participating if its students met eligibility requirements.
Recommendation
Time and Effort
We recommend the District establish and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
Private Schools
We recommend the District establish and follow internal controls to ensure it
complies with federal and OSPI requirements for contacting private schools within
its boundaries to determine whether eligible schools would like to participate in
Title I services.
District’s Response
The District concurs with the finding. In response, the District has established a
regularly updated list of private schools within our boundaries. We will be
proactively reaching out to these schools each year to determine interest and
eligibility for Title I services, and are documenting all correspondence. In addition,
we have strengthened time-and-effort documentation procedures as described in
2024-001. Our new internal controls include multi-layered reviews and program
director oversight to ensure timely, complete compliance. The District is committed
to equity in services and transparency in all federal programming.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
Title 34 CFR, Part 200, Title I – Improving the Academic Achievement of the
Disadvantaged, Subpart A – Improving Basic Programs Operated by Local
Education Agencies, Section 78 – Allocation of funds to school attendance areas
and schools
Title 34 CFR, Part 200, Title I – Improving the Academic Achievement of the
Disadvantaged, Subpart A – Improving Basic Programs Operated by Local
Education Agencies, Section 64 – Factors for determining equitable participation
of private school children
The District did not have adequate internal controls and did not
comply with time-and-effort and private school requirements.
Assistance Listing Number and Title: 84.010 – Title I Grants to Local
Educational Agencies
Federal Agency Name: U.S. Department of Education
Federal Award/Contract Number: N/A
Pass-through Entity Name: Office of Superintendent of Public
Instruction (OSPI)
Pass-through Award/Contract
Number: N/A
Questioned Cost Amount: $2,932,172
Prior Year Audit Finding: N/A
Background
The objective of the Title I program is to improve the teaching and learning of
children who are at risk of not meeting state academic standards and who live in
areas with high concentrations of children from low-income families. During the
2023-2024 school year, the District spent $2,932,172 in federal funds from the Title
I program.
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Time and Effort
The District is responsible for ensuring it supports all payroll costs it charges to the
program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the employee
completes the work.
Private Schools
Federal regulations require districts using Title I funds to consult with private
schools located within their boundaries to provide their eligible students, teachers
and families with equitable services. The District must maintain documentation
supporting that it contacted the private schools.
Description of Condition
Time and Effort
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and the Office of Superintendent of Public
Instruction (OSPI) require.
Private Schools
The District’s internal controls were ineffective for ensuring it consulted with
private schools within its boundaries to identify if students in the schools were
eligible to receive Title I services.
We consider these deficiencies in internal controls to be material weaknesses that
led to material noncompliance.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to locate supporting
documentation for time-and-effort or to indicate it contacted the private schools.
Effect of Condition and Questioned Costs
Time and Effort
The District did not obtain time-and-effort documentation for 235 employees
whose payroll and benefits costs totaling $2,932,172 were charged to the program.
Federal regulations require the State Auditor’s Office to report known questioned
costs that are greater than $25,000 for each type of compliance requirement. We
question costs when we find the District does not have adequate documentation to
support expenditures.
Private Schools
The District did not contact three private schools within its boundaries to determine
if there were eligible students that could have received Title I services. During our
audit, the District contacted all three private schools and one of them would have
been interested in participating if its students met eligibility requirements.
Recommendation
Time and Effort
We recommend the District establish and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
Private Schools
We recommend the District establish and follow internal controls to ensure it
complies with federal and OSPI requirements for contacting private schools within
its boundaries to determine whether eligible schools would like to participate in
Title I services.
District’s Response
The District concurs with the finding. In response, the District has established a
regularly updated list of private schools within our boundaries. We will be
proactively reaching out to these schools each year to determine interest and
eligibility for Title I services, and are documenting all correspondence. In addition,
we have strengthened time-and-effort documentation procedures as described in
2024-001. Our new internal controls include multi-layered reviews and program
director oversight to ensure timely, complete compliance. The District is committed
to equity in services and transparency in all federal programming.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
Title 34 CFR, Part 200, Title I – Improving the Academic Achievement of the
Disadvantaged, Subpart A – Improving Basic Programs Operated by Local
Education Agencies, Section 78 – Allocation of funds to school attendance areas
and schools
Title 34 CFR, Part 200, Title I – Improving the Academic Achievement of the
Disadvantaged, Subpart A – Improving Basic Programs Operated by Local
Education Agencies, Section 64 – Factors for determining equitable participation
of private school children
The District did not have adequate internal controls and did not
comply with time-and-effort and private school requirements.
Assistance Listing Number and Title: 84.010 – Title I Grants to Local
Educational Agencies
Federal Agency Name: U.S. Department of Education
Federal Award/Contract Number: N/A
Pass-through Entity Name: Office of Superintendent of Public
Instruction (OSPI)
Pass-through Award/Contract
Number: N/A
Questioned Cost Amount: $2,932,172
Prior Year Audit Finding: N/A
Background
The objective of the Title I program is to improve the teaching and learning of
children who are at risk of not meeting state academic standards and who live in
areas with high concentrations of children from low-income families. During the
2023-2024 school year, the District spent $2,932,172 in federal funds from the Title
I program.
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Time and Effort
The District is responsible for ensuring it supports all payroll costs it charges to the
program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the employee
completes the work.
Private Schools
Federal regulations require districts using Title I funds to consult with private
schools located within their boundaries to provide their eligible students, teachers
and families with equitable services. The District must maintain documentation
supporting that it contacted the private schools.
Description of Condition
Time and Effort
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and the Office of Superintendent of Public
Instruction (OSPI) require.
Private Schools
The District’s internal controls were ineffective for ensuring it consulted with
private schools within its boundaries to identify if students in the schools were
eligible to receive Title I services.
We consider these deficiencies in internal controls to be material weaknesses that
led to material noncompliance.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to locate supporting
documentation for time-and-effort or to indicate it contacted the private schools.
Effect of Condition and Questioned Costs
Time and Effort
The District did not obtain time-and-effort documentation for 235 employees
whose payroll and benefits costs totaling $2,932,172 were charged to the program.
Federal regulations require the State Auditor’s Office to report known questioned
costs that are greater than $25,000 for each type of compliance requirement. We
question costs when we find the District does not have adequate documentation to
support expenditures.
Private Schools
The District did not contact three private schools within its boundaries to determine
if there were eligible students that could have received Title I services. During our
audit, the District contacted all three private schools and one of them would have
been interested in participating if its students met eligibility requirements.
Recommendation
Time and Effort
We recommend the District establish and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
Private Schools
We recommend the District establish and follow internal controls to ensure it
complies with federal and OSPI requirements for contacting private schools within
its boundaries to determine whether eligible schools would like to participate in
Title I services.
District’s Response
The District concurs with the finding. In response, the District has established a
regularly updated list of private schools within our boundaries. We will be
proactively reaching out to these schools each year to determine interest and
eligibility for Title I services, and are documenting all correspondence. In addition,
we have strengthened time-and-effort documentation procedures as described in
2024-001. Our new internal controls include multi-layered reviews and program
director oversight to ensure timely, complete compliance. The District is committed
to equity in services and transparency in all federal programming.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
Title 34 CFR, Part 200, Title I – Improving the Academic Achievement of the
Disadvantaged, Subpart A – Improving Basic Programs Operated by Local
Education Agencies, Section 78 – Allocation of funds to school attendance areas
and schools
Title 34 CFR, Part 200, Title I – Improving the Academic Achievement of the
Disadvantaged, Subpart A – Improving Basic Programs Operated by Local
Education Agencies, Section 64 – Factors for determining equitable participation
of private school children
The District did not have adequate internal controls and did not
comply with time-and-effort requirements.
Assistance Listing Number and Title: 84.027, Special Education Grant to
States
84.173, Special Education
Preschool Grants
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number: N/A
Pass-through Entity Name: Office of Superintendent of Public
Instruction (OSPI)
Pass-through Award/Contract
Number:
84.027A-GT-0852;
84.173A-GT-0852;
84.173 – GT-1196
Known Questioned Cost Amount: $1,415,509
Prior Year Audit Finding: N/A
Background
During fiscal year 2024, the District spent $1,842,531 in federal funds from the
Special Education program cluster. This program ensures students with disabilities
receive free and appropriate public education with specially designed instruction
that addresses their unique needs.
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
The District is responsible for ensuring it supports all payroll costs it charges to the
program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after employees
complete the work.
If the District initially allocates payroll expenditures to federal programs based on
a budgeted or estimated time or amounts, then it must compare and adjust estimated
payroll time-and-effort records to actual time at least quarterly, if the difference is
10% or more. At year-end, payroll records must match time-and-effort
documentation to ensure the District only charges federal programs for work
directly supporting them.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and the Office of Superintendent of Public
Instruction (OSPI) require.
We consider this deficiency in internal controls to be a material weakness that led
to material noncompliance.
Cause of Condition
The District experienced turnover in key positions responsible for monitoring the
program. As a result, the current staff were unable to demonstrate former
employees dedicated the necessary time and resources to reconciling time charged
to the program and ensuring it was supported with time-and-effort documentation.
Effect of Condition and Questioned Costs
The District did not obtain time-and-effort documentation for 19 employees whose
payroll and benefit costs totaling $1,415,509 it charged to the program.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known questioned
costs that are greater than $25,000 for each type of compliance requirement. We
question costs when we find the District does not have adequate documentation to
support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges the finding and has implemented new procedures to
ensure strong internal controls over time-and-effort documentation. This issue
primarily occurred during a period of staff turnover. The District has since hired
experienced personnel who are now overseeing federal program compliance. We
have implemented a compliant time-and-effort tracking system consistent with
OSPI and federal requirements. Documentation—whether semiannual
certifications or monthly reports, as applicable—is collected, reviewed, and
retained in accordance with the type of funding allocation. All documentation is
reviewed by both the Business Office and program administrators to ensure
accuracy. Monthly monitoring and required training for relevant staff are now
embedded into our internal processes. The district is committed to ensuring
accuracy and accountability in all federally funded programs.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems
The District did not have adequate internal controls and did not
comply with time-and-effort requirements.
Assistance Listing Number and Title: 84.027, Special Education Grant to
States
84.173, Special Education
Preschool Grants
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number: N/A
Pass-through Entity Name: Office of Superintendent of Public
Instruction (OSPI)
Pass-through Award/Contract
Number:
84.027A-GT-0852;
84.173A-GT-0852;
84.173 – GT-1196
Known Questioned Cost Amount: $1,415,509
Prior Year Audit Finding: N/A
Background
During fiscal year 2024, the District spent $1,842,531 in federal funds from the
Special Education program cluster. This program ensures students with disabilities
receive free and appropriate public education with specially designed instruction
that addresses their unique needs.
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
The District is responsible for ensuring it supports all payroll costs it charges to the
program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after employees
complete the work.
If the District initially allocates payroll expenditures to federal programs based on
a budgeted or estimated time or amounts, then it must compare and adjust estimated
payroll time-and-effort records to actual time at least quarterly, if the difference is
10% or more. At year-end, payroll records must match time-and-effort
documentation to ensure the District only charges federal programs for work
directly supporting them.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and the Office of Superintendent of Public
Instruction (OSPI) require.
We consider this deficiency in internal controls to be a material weakness that led
to material noncompliance.
Cause of Condition
The District experienced turnover in key positions responsible for monitoring the
program. As a result, the current staff were unable to demonstrate former
employees dedicated the necessary time and resources to reconciling time charged
to the program and ensuring it was supported with time-and-effort documentation.
Effect of Condition and Questioned Costs
The District did not obtain time-and-effort documentation for 19 employees whose
payroll and benefit costs totaling $1,415,509 it charged to the program.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known questioned
costs that are greater than $25,000 for each type of compliance requirement. We
question costs when we find the District does not have adequate documentation to
support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges the finding and has implemented new procedures to
ensure strong internal controls over time-and-effort documentation. This issue
primarily occurred during a period of staff turnover. The District has since hired
experienced personnel who are now overseeing federal program compliance. We
have implemented a compliant time-and-effort tracking system consistent with
OSPI and federal requirements. Documentation—whether semiannual
certifications or monthly reports, as applicable—is collected, reviewed, and
retained in accordance with the type of funding allocation. All documentation is
reviewed by both the Business Office and program administrators to ensure
accuracy. Monthly monitoring and required training for relevant staff are now
embedded into our internal processes. The district is committed to ensuring
accuracy and accountability in all federally funded programs.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems
The District did not have adequate internal controls and did not
comply with time-and-effort requirements.
Assistance Listing Number and Title: 84.027, Special Education Grant to
States
84.173, Special Education
Preschool Grants
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number: N/A
Pass-through Entity Name: Office of Superintendent of Public
Instruction (OSPI)
Pass-through Award/Contract
Number:
84.027A-GT-0852;
84.173A-GT-0852;
84.173 – GT-1196
Known Questioned Cost Amount: $1,415,509
Prior Year Audit Finding: N/A
Background
During fiscal year 2024, the District spent $1,842,531 in federal funds from the
Special Education program cluster. This program ensures students with disabilities
receive free and appropriate public education with specially designed instruction
that addresses their unique needs.
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
The District is responsible for ensuring it supports all payroll costs it charges to the
program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after employees
complete the work.
If the District initially allocates payroll expenditures to federal programs based on
a budgeted or estimated time or amounts, then it must compare and adjust estimated
payroll time-and-effort records to actual time at least quarterly, if the difference is
10% or more. At year-end, payroll records must match time-and-effort
documentation to ensure the District only charges federal programs for work
directly supporting them.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and the Office of Superintendent of Public
Instruction (OSPI) require.
We consider this deficiency in internal controls to be a material weakness that led
to material noncompliance.
Cause of Condition
The District experienced turnover in key positions responsible for monitoring the
program. As a result, the current staff were unable to demonstrate former
employees dedicated the necessary time and resources to reconciling time charged
to the program and ensuring it was supported with time-and-effort documentation.
Effect of Condition and Questioned Costs
The District did not obtain time-and-effort documentation for 19 employees whose
payroll and benefit costs totaling $1,415,509 it charged to the program.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known questioned
costs that are greater than $25,000 for each type of compliance requirement. We
question costs when we find the District does not have adequate documentation to
support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges the finding and has implemented new procedures to
ensure strong internal controls over time-and-effort documentation. This issue
primarily occurred during a period of staff turnover. The District has since hired
experienced personnel who are now overseeing federal program compliance. We
have implemented a compliant time-and-effort tracking system consistent with
OSPI and federal requirements. Documentation—whether semiannual
certifications or monthly reports, as applicable—is collected, reviewed, and
retained in accordance with the type of funding allocation. All documentation is
reviewed by both the Business Office and program administrators to ensure
accuracy. Monthly monitoring and required training for relevant staff are now
embedded into our internal processes. The district is committed to ensuring
accuracy and accountability in all federally funded programs.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303, Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems
The District did not have adequate internal controls for ensuring
compliance with time-and-effort requirements.
Assistance Listing Number and Title: 84.425 – COVID-19 – Educational
Stabilization Fund
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number:
Pass-through Entity Name: Office of the Superintendent of
Public Instruction (OSPI)
Pass-through Award/Contract
Number:
84.425D-CEP Supp ESSER;
84.425U-138288; 84.425U-142142;
84.425U-145312; 84.425U-145823;
84.425V-6109; 84.425W-459563
Known Questioned Cost Amount: $47,853
Prior Year Audit Finding: N/A
Background
The objectives of the Education Stabilization Fund (ESF) program are to prevent,
prepare for and respond to the COVID-19 pandemic. In fiscal year 2024, the
District spent a total of $10,463,256 of its ESF awards. This included $191,184 in
the Elementary and Secondary School Emergency Relief Fund (ESSER II)
subprogram (84.425D), $10,099,901 in the American Rescue Plan Elementary and
Secondary School Emergency Relief (ARP ESSER/ESSER III) subprogram
(84.425U), $114,781 in the American Rescue Plan – Emergency Assistance to
Non-Public Schools (ARP EANS/EANS II) subprogram (84.425V) and $57,390 in
the American Rescue Plan Elementary and Secondary School Emergency Relief –
Homeless Children and Youth (ARP-HCY) subprogram (84.425W).
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Federal regulations also establish principles and standards for determining
allowable direct and indirect costs for federal awards. Additionally, federal
regulations and the Office of Superintendent of Public Instruction (OSPI) require
all costs charged to the program to comply with program requirements and
recipients to support this compliance with proper documentation that demonstrates
costs are allowable.
The District is also responsible for ensuring it supports all payroll costs charged to
the program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the work is
completed.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and OSPI require. Our audit found the
District transferred $47,853 of salary and benefit amounts to its ESSER III
(84.425U) award that were originally coded to other local, state and federal
programs, resulting in employees being charged to multiple federal programs
without appropriate time-and-effort documentation.
We consider this internal control deficiency to be a significant deficiency.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to find any documentation
showing time-and-effort had been collected.
Effect of Condition and Questioned Costs
Using a statistical sample of all journal entry transactions that included both
accounts payable and payroll disbursements, we found nine out of 29 transactions
we tested had exceptions. Those exceptions were related to salaries and benefits
totaling $47,853 that were not supported by time-and-effort documentation. Based
on the projection of our sample, we identified an additional $651,791 in estimated
unsupported costs.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known and likely
questioned costs that are more than $25,000 for each type of compliance
requirement. We question costs when we find the District does not have adequate
documentation to support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges this finding and has taken steps to address all time-andeffort
documentation issues. New procedures are now in place, including formal
time-and-effort tracking using the appropriate method—semiannual or monthly—
based on program guidelines and funding structure. The District has also
implemented a policy that requires all journal entries to include supporting
documentation. Each journal entry is reviewed and approved by multiple staff,
including Business Office staff and program directors, before posting. These
safeguards will ensure accountability, prevent future exceptions, and maintain
public trust.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303 Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, section 403, Factors affecting
allowability of costs, describes the cost principles for how direct and indirect costs
should be charged to federal programs.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
The District did not have adequate internal controls for ensuring
compliance with time-and-effort requirements.
Assistance Listing Number and Title: 84.425 – COVID-19 – Educational
Stabilization Fund
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number:
Pass-through Entity Name: Office of the Superintendent of
Public Instruction (OSPI)
Pass-through Award/Contract
Number:
84.425D-CEP Supp ESSER;
84.425U-138288; 84.425U-142142;
84.425U-145312; 84.425U-145823;
84.425V-6109; 84.425W-459563
Known Questioned Cost Amount: $47,853
Prior Year Audit Finding: N/A
Background
The objectives of the Education Stabilization Fund (ESF) program are to prevent,
prepare for and respond to the COVID-19 pandemic. In fiscal year 2024, the
District spent a total of $10,463,256 of its ESF awards. This included $191,184 in
the Elementary and Secondary School Emergency Relief Fund (ESSER II)
subprogram (84.425D), $10,099,901 in the American Rescue Plan Elementary and
Secondary School Emergency Relief (ARP ESSER/ESSER III) subprogram
(84.425U), $114,781 in the American Rescue Plan – Emergency Assistance to
Non-Public Schools (ARP EANS/EANS II) subprogram (84.425V) and $57,390 in
the American Rescue Plan Elementary and Secondary School Emergency Relief –
Homeless Children and Youth (ARP-HCY) subprogram (84.425W).
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Federal regulations also establish principles and standards for determining
allowable direct and indirect costs for federal awards. Additionally, federal
regulations and the Office of Superintendent of Public Instruction (OSPI) require
all costs charged to the program to comply with program requirements and
recipients to support this compliance with proper documentation that demonstrates
costs are allowable.
The District is also responsible for ensuring it supports all payroll costs charged to
the program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the work is
completed.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and OSPI require. Our audit found the
District transferred $47,853 of salary and benefit amounts to its ESSER III
(84.425U) award that were originally coded to other local, state and federal
programs, resulting in employees being charged to multiple federal programs
without appropriate time-and-effort documentation.
We consider this internal control deficiency to be a significant deficiency.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to find any documentation
showing time-and-effort had been collected.
Effect of Condition and Questioned Costs
Using a statistical sample of all journal entry transactions that included both
accounts payable and payroll disbursements, we found nine out of 29 transactions
we tested had exceptions. Those exceptions were related to salaries and benefits
totaling $47,853 that were not supported by time-and-effort documentation. Based
on the projection of our sample, we identified an additional $651,791 in estimated
unsupported costs.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known and likely
questioned costs that are more than $25,000 for each type of compliance
requirement. We question costs when we find the District does not have adequate
documentation to support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges this finding and has taken steps to address all time-andeffort
documentation issues. New procedures are now in place, including formal
time-and-effort tracking using the appropriate method—semiannual or monthly—
based on program guidelines and funding structure. The District has also
implemented a policy that requires all journal entries to include supporting
documentation. Each journal entry is reviewed and approved by multiple staff,
including Business Office staff and program directors, before posting. These
safeguards will ensure accountability, prevent future exceptions, and maintain
public trust.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303 Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, section 403, Factors affecting
allowability of costs, describes the cost principles for how direct and indirect costs
should be charged to federal programs.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
The District did not have adequate internal controls for ensuring
compliance with time-and-effort requirements.
Assistance Listing Number and Title: 84.425 – COVID-19 – Educational
Stabilization Fund
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number:
Pass-through Entity Name: Office of the Superintendent of
Public Instruction (OSPI)
Pass-through Award/Contract
Number:
84.425D-CEP Supp ESSER;
84.425U-138288; 84.425U-142142;
84.425U-145312; 84.425U-145823;
84.425V-6109; 84.425W-459563
Known Questioned Cost Amount: $47,853
Prior Year Audit Finding: N/A
Background
The objectives of the Education Stabilization Fund (ESF) program are to prevent,
prepare for and respond to the COVID-19 pandemic. In fiscal year 2024, the
District spent a total of $10,463,256 of its ESF awards. This included $191,184 in
the Elementary and Secondary School Emergency Relief Fund (ESSER II)
subprogram (84.425D), $10,099,901 in the American Rescue Plan Elementary and
Secondary School Emergency Relief (ARP ESSER/ESSER III) subprogram
(84.425U), $114,781 in the American Rescue Plan – Emergency Assistance to
Non-Public Schools (ARP EANS/EANS II) subprogram (84.425V) and $57,390 in
the American Rescue Plan Elementary and Secondary School Emergency Relief –
Homeless Children and Youth (ARP-HCY) subprogram (84.425W).
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Federal regulations also establish principles and standards for determining
allowable direct and indirect costs for federal awards. Additionally, federal
regulations and the Office of Superintendent of Public Instruction (OSPI) require
all costs charged to the program to comply with program requirements and
recipients to support this compliance with proper documentation that demonstrates
costs are allowable.
The District is also responsible for ensuring it supports all payroll costs charged to
the program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the work is
completed.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and OSPI require. Our audit found the
District transferred $47,853 of salary and benefit amounts to its ESSER III
(84.425U) award that were originally coded to other local, state and federal
programs, resulting in employees being charged to multiple federal programs
without appropriate time-and-effort documentation.
We consider this internal control deficiency to be a significant deficiency.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to find any documentation
showing time-and-effort had been collected.
Effect of Condition and Questioned Costs
Using a statistical sample of all journal entry transactions that included both
accounts payable and payroll disbursements, we found nine out of 29 transactions
we tested had exceptions. Those exceptions were related to salaries and benefits
totaling $47,853 that were not supported by time-and-effort documentation. Based
on the projection of our sample, we identified an additional $651,791 in estimated
unsupported costs.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known and likely
questioned costs that are more than $25,000 for each type of compliance
requirement. We question costs when we find the District does not have adequate
documentation to support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges this finding and has taken steps to address all time-andeffort
documentation issues. New procedures are now in place, including formal
time-and-effort tracking using the appropriate method—semiannual or monthly—
based on program guidelines and funding structure. The District has also
implemented a policy that requires all journal entries to include supporting
documentation. Each journal entry is reviewed and approved by multiple staff,
including Business Office staff and program directors, before posting. These
safeguards will ensure accountability, prevent future exceptions, and maintain
public trust.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303 Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, section 403, Factors affecting
allowability of costs, describes the cost principles for how direct and indirect costs
should be charged to federal programs.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
The District did not have adequate internal controls for ensuring
compliance with time-and-effort requirements.
Assistance Listing Number and Title: 84.425 – COVID-19 – Educational
Stabilization Fund
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number:
Pass-through Entity Name: Office of the Superintendent of
Public Instruction (OSPI)
Pass-through Award/Contract
Number:
84.425D-CEP Supp ESSER;
84.425U-138288; 84.425U-142142;
84.425U-145312; 84.425U-145823;
84.425V-6109; 84.425W-459563
Known Questioned Cost Amount: $47,853
Prior Year Audit Finding: N/A
Background
The objectives of the Education Stabilization Fund (ESF) program are to prevent,
prepare for and respond to the COVID-19 pandemic. In fiscal year 2024, the
District spent a total of $10,463,256 of its ESF awards. This included $191,184 in
the Elementary and Secondary School Emergency Relief Fund (ESSER II)
subprogram (84.425D), $10,099,901 in the American Rescue Plan Elementary and
Secondary School Emergency Relief (ARP ESSER/ESSER III) subprogram
(84.425U), $114,781 in the American Rescue Plan – Emergency Assistance to
Non-Public Schools (ARP EANS/EANS II) subprogram (84.425V) and $57,390 in
the American Rescue Plan Elementary and Secondary School Emergency Relief –
Homeless Children and Youth (ARP-HCY) subprogram (84.425W).
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Federal regulations also establish principles and standards for determining
allowable direct and indirect costs for federal awards. Additionally, federal
regulations and the Office of Superintendent of Public Instruction (OSPI) require
all costs charged to the program to comply with program requirements and
recipients to support this compliance with proper documentation that demonstrates
costs are allowable.
The District is also responsible for ensuring it supports all payroll costs charged to
the program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the work is
completed.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and OSPI require. Our audit found the
District transferred $47,853 of salary and benefit amounts to its ESSER III
(84.425U) award that were originally coded to other local, state and federal
programs, resulting in employees being charged to multiple federal programs
without appropriate time-and-effort documentation.
We consider this internal control deficiency to be a significant deficiency.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to find any documentation
showing time-and-effort had been collected.
Effect of Condition and Questioned Costs
Using a statistical sample of all journal entry transactions that included both
accounts payable and payroll disbursements, we found nine out of 29 transactions
we tested had exceptions. Those exceptions were related to salaries and benefits
totaling $47,853 that were not supported by time-and-effort documentation. Based
on the projection of our sample, we identified an additional $651,791 in estimated
unsupported costs.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known and likely
questioned costs that are more than $25,000 for each type of compliance
requirement. We question costs when we find the District does not have adequate
documentation to support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges this finding and has taken steps to address all time-andeffort
documentation issues. New procedures are now in place, including formal
time-and-effort tracking using the appropriate method—semiannual or monthly—
based on program guidelines and funding structure. The District has also
implemented a policy that requires all journal entries to include supporting
documentation. Each journal entry is reviewed and approved by multiple staff,
including Business Office staff and program directors, before posting. These
safeguards will ensure accountability, prevent future exceptions, and maintain
public trust.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303 Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, section 403, Factors affecting
allowability of costs, describes the cost principles for how direct and indirect costs
should be charged to federal programs.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
The District did not have adequate internal controls for ensuring
compliance with time-and-effort requirements.
Assistance Listing Number and Title: 84.425 – COVID-19 – Educational
Stabilization Fund
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number:
Pass-through Entity Name: Office of the Superintendent of
Public Instruction (OSPI)
Pass-through Award/Contract
Number:
84.425D-CEP Supp ESSER;
84.425U-138288; 84.425U-142142;
84.425U-145312; 84.425U-145823;
84.425V-6109; 84.425W-459563
Known Questioned Cost Amount: $47,853
Prior Year Audit Finding: N/A
Background
The objectives of the Education Stabilization Fund (ESF) program are to prevent,
prepare for and respond to the COVID-19 pandemic. In fiscal year 2024, the
District spent a total of $10,463,256 of its ESF awards. This included $191,184 in
the Elementary and Secondary School Emergency Relief Fund (ESSER II)
subprogram (84.425D), $10,099,901 in the American Rescue Plan Elementary and
Secondary School Emergency Relief (ARP ESSER/ESSER III) subprogram
(84.425U), $114,781 in the American Rescue Plan – Emergency Assistance to
Non-Public Schools (ARP EANS/EANS II) subprogram (84.425V) and $57,390 in
the American Rescue Plan Elementary and Secondary School Emergency Relief –
Homeless Children and Youth (ARP-HCY) subprogram (84.425W).
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Federal regulations also establish principles and standards for determining
allowable direct and indirect costs for federal awards. Additionally, federal
regulations and the Office of Superintendent of Public Instruction (OSPI) require
all costs charged to the program to comply with program requirements and
recipients to support this compliance with proper documentation that demonstrates
costs are allowable.
The District is also responsible for ensuring it supports all payroll costs charged to
the program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the work is
completed.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and OSPI require. Our audit found the
District transferred $47,853 of salary and benefit amounts to its ESSER III
(84.425U) award that were originally coded to other local, state and federal
programs, resulting in employees being charged to multiple federal programs
without appropriate time-and-effort documentation.
We consider this internal control deficiency to be a significant deficiency.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to find any documentation
showing time-and-effort had been collected.
Effect of Condition and Questioned Costs
Using a statistical sample of all journal entry transactions that included both
accounts payable and payroll disbursements, we found nine out of 29 transactions
we tested had exceptions. Those exceptions were related to salaries and benefits
totaling $47,853 that were not supported by time-and-effort documentation. Based
on the projection of our sample, we identified an additional $651,791 in estimated
unsupported costs.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known and likely
questioned costs that are more than $25,000 for each type of compliance
requirement. We question costs when we find the District does not have adequate
documentation to support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges this finding and has taken steps to address all time-andeffort
documentation issues. New procedures are now in place, including formal
time-and-effort tracking using the appropriate method—semiannual or monthly—
based on program guidelines and funding structure. The District has also
implemented a policy that requires all journal entries to include supporting
documentation. Each journal entry is reviewed and approved by multiple staff,
including Business Office staff and program directors, before posting. These
safeguards will ensure accountability, prevent future exceptions, and maintain
public trust.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303 Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, section 403, Factors affecting
allowability of costs, describes the cost principles for how direct and indirect costs
should be charged to federal programs.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
The District did not have adequate internal controls for ensuring
compliance with time-and-effort requirements.
Assistance Listing Number and Title: 84.425 – COVID-19 – Educational
Stabilization Fund
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number:
Pass-through Entity Name: Office of the Superintendent of
Public Instruction (OSPI)
Pass-through Award/Contract
Number:
84.425D-CEP Supp ESSER;
84.425U-138288; 84.425U-142142;
84.425U-145312; 84.425U-145823;
84.425V-6109; 84.425W-459563
Known Questioned Cost Amount: $47,853
Prior Year Audit Finding: N/A
Background
The objectives of the Education Stabilization Fund (ESF) program are to prevent,
prepare for and respond to the COVID-19 pandemic. In fiscal year 2024, the
District spent a total of $10,463,256 of its ESF awards. This included $191,184 in
the Elementary and Secondary School Emergency Relief Fund (ESSER II)
subprogram (84.425D), $10,099,901 in the American Rescue Plan Elementary and
Secondary School Emergency Relief (ARP ESSER/ESSER III) subprogram
(84.425U), $114,781 in the American Rescue Plan – Emergency Assistance to
Non-Public Schools (ARP EANS/EANS II) subprogram (84.425V) and $57,390 in
the American Rescue Plan Elementary and Secondary School Emergency Relief –
Homeless Children and Youth (ARP-HCY) subprogram (84.425W).
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Federal regulations also establish principles and standards for determining
allowable direct and indirect costs for federal awards. Additionally, federal
regulations and the Office of Superintendent of Public Instruction (OSPI) require
all costs charged to the program to comply with program requirements and
recipients to support this compliance with proper documentation that demonstrates
costs are allowable.
The District is also responsible for ensuring it supports all payroll costs charged to
the program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the work is
completed.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and OSPI require. Our audit found the
District transferred $47,853 of salary and benefit amounts to its ESSER III
(84.425U) award that were originally coded to other local, state and federal
programs, resulting in employees being charged to multiple federal programs
without appropriate time-and-effort documentation.
We consider this internal control deficiency to be a significant deficiency.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to find any documentation
showing time-and-effort had been collected.
Effect of Condition and Questioned Costs
Using a statistical sample of all journal entry transactions that included both
accounts payable and payroll disbursements, we found nine out of 29 transactions
we tested had exceptions. Those exceptions were related to salaries and benefits
totaling $47,853 that were not supported by time-and-effort documentation. Based
on the projection of our sample, we identified an additional $651,791 in estimated
unsupported costs.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known and likely
questioned costs that are more than $25,000 for each type of compliance
requirement. We question costs when we find the District does not have adequate
documentation to support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges this finding and has taken steps to address all time-andeffort
documentation issues. New procedures are now in place, including formal
time-and-effort tracking using the appropriate method—semiannual or monthly—
based on program guidelines and funding structure. The District has also
implemented a policy that requires all journal entries to include supporting
documentation. Each journal entry is reviewed and approved by multiple staff,
including Business Office staff and program directors, before posting. These
safeguards will ensure accountability, prevent future exceptions, and maintain
public trust.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303 Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, section 403, Factors affecting
allowability of costs, describes the cost principles for how direct and indirect costs
should be charged to federal programs.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.
The District did not have adequate internal controls for ensuring
compliance with time-and-effort requirements.
Assistance Listing Number and Title: 84.425 – COVID-19 – Educational
Stabilization Fund
Federal Grantor Name: U.S. Department of Education
Federal Award/Contract Number:
Pass-through Entity Name: Office of the Superintendent of
Public Instruction (OSPI)
Pass-through Award/Contract
Number:
84.425D-CEP Supp ESSER;
84.425U-138288; 84.425U-142142;
84.425U-145312; 84.425U-145823;
84.425V-6109; 84.425W-459563
Known Questioned Cost Amount: $47,853
Prior Year Audit Finding: N/A
Background
The objectives of the Education Stabilization Fund (ESF) program are to prevent,
prepare for and respond to the COVID-19 pandemic. In fiscal year 2024, the
District spent a total of $10,463,256 of its ESF awards. This included $191,184 in
the Elementary and Secondary School Emergency Relief Fund (ESSER II)
subprogram (84.425D), $10,099,901 in the American Rescue Plan Elementary and
Secondary School Emergency Relief (ARP ESSER/ESSER III) subprogram
(84.425U), $114,781 in the American Rescue Plan – Emergency Assistance to
Non-Public Schools (ARP EANS/EANS II) subprogram (84.425V) and $57,390 in
the American Rescue Plan Elementary and Secondary School Emergency Relief –
Homeless Children and Youth (ARP-HCY) subprogram (84.425W).
Federal regulations require recipients to establish and maintain internal controls
that ensure compliance with program requirements. These controls include
understanding program requirements and monitoring the effectiveness of
established controls.
Federal regulations also establish principles and standards for determining
allowable direct and indirect costs for federal awards. Additionally, federal
regulations and the Office of Superintendent of Public Instruction (OSPI) require
all costs charged to the program to comply with program requirements and
recipients to support this compliance with proper documentation that demonstrates
costs are allowable.
The District is also responsible for ensuring it supports all payroll costs charged to
the program with adequate time-and-effort documentation, as required by federal
regulations and the awarding agency. Depending on the number and types of
activities employees perform, time-and-effort documentation can be a semiannual
certification or a monthly personnel activity report, such as a detailed timesheet.
Time-and-effort documentation must also be signed and dated after the work is
completed.
Description of Condition
The District’s internal controls were ineffective for ensuring it supported all salaries
and benefits it charged to the program with appropriate time-and-effort
documentation, as federal regulations and OSPI require. Our audit found the
District transferred $47,853 of salary and benefit amounts to its ESSER III
(84.425U) award that were originally coded to other local, state and federal
programs, resulting in employees being charged to multiple federal programs
without appropriate time-and-effort documentation.
We consider this internal control deficiency to be a significant deficiency.
Cause of Condition
The District experienced turnover in the key position responsible for managing the
program. As a result, the current staff were unable to find any documentation
showing time-and-effort had been collected.
Effect of Condition and Questioned Costs
Using a statistical sample of all journal entry transactions that included both
accounts payable and payroll disbursements, we found nine out of 29 transactions
we tested had exceptions. Those exceptions were related to salaries and benefits
totaling $47,853 that were not supported by time-and-effort documentation. Based
on the projection of our sample, we identified an additional $651,791 in estimated
unsupported costs.
Without adequate time-and-effort documentation, the District cannot demonstrate
compliance with the awarding agency’s documentation requirements to support
costs charged to federal programs. Further, the District cannot assure federal
grantors that payroll costs it charged to the program were accurate and valid.
Federal regulations require the State Auditor’s Office to report known and likely
questioned costs that are more than $25,000 for each type of compliance
requirement. We question costs when we find the District does not have adequate
documentation to support expenditures.
Recommendation
We recommend the District implement and follow internal controls to ensure it
complies with federal and OSPI requirements for obtaining signed time-and-effort
documentation timely.
District’s Response
The District acknowledges this finding and has taken steps to address all time-andeffort
documentation issues. New procedures are now in place, including formal
time-and-effort tracking using the appropriate method—semiannual or monthly—
based on program guidelines and funding structure. The District has also
implemented a policy that requires all journal entries to include supporting
documentation. Each journal entry is reviewed and approved by multiple staff,
including Business Office staff and program directors, before posting. These
safeguards will ensure accountability, prevent future exceptions, and maintain
public trust.
Auditor’s Remarks
We thank the District for its cooperation and assistance during the audit and
acknowledge its commitment to resolve this finding. We will review the corrective
action taken during our next audit.
Applicable Laws and Regulations
Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance), section 516, Audit findings, establishes reporting
requirements for audit findings.
Title 2 CFR Part 200, Uniform Guidance, section 303 Internal controls, describes
the requirements for auditees to maintain internal controls over federal programs
and comply with federal program requirements.
The American Institute of Certified Public Accountants defines significant
deficiencies and material weaknesses in its Codification of Statements on Auditing
Standards, section 935, Compliance Audits, paragraph 11.
Title 2 CFR Part 200, Uniform Guidance, section 403, Factors affecting
allowability of costs, describes the cost principles for how direct and indirect costs
should be charged to federal programs.
Title 2 CFR Part 200, Uniform Guidance, Subpart E, Cost Principles, establishes
requirements for determining allowable costs and supporting costs allocated to
federal programs.
Office of Superintendent of Public Instruction Addendum to Bulletin 048-17,
Guidelines for Charging Employee Compensation to Federal Grants establishes
requirements for documenting time-and-effort, including fixed schedule systems.