Audit 374308

8. Criteria or specific requirement :Per Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (2 CFR Part 200) Subpart D, Post Federal Award Requirements Section 200.303, Internal controls, the recipient must establish, document and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient is managing the Federal award in compliance with Federal statutes, regulations and the terms and conditions of the Federal award. Per 2 CFR Part 200, Subpart E, Cost Principles, the accounting practices of the recipient must be consistent with the cost principles and support the accumulation of costs as required by the cost principles, including maintaining adequate documentation to support costs charged to the Federal award. '9. Condition: The District's accounting records did not support reported program expenditures totaling $32,734 due to the following: 1. Expenditures of $15,589 incurred and claimed for reimbursement in the prior year were claimed again in the current year. 2. Current year expenditures of $12,854 were claimed twice. 3. Payroll expenditures were claimed based on budget rather than actual amounts, resulting in claimed expenditures of $4,291 which were not supported. 10. Cause :The District's internal controls over compliance were not functioning effectively to ensure reimbursements were claimed for only actual expenditures incurred and supported by adequate documentation. 11. Effect: The District was not in compliance with the allowable costs/cost principles compliance requirement. 12. Questioned Costs: The following questioned costs were computed based on differences between the amounts claimed for reimbursement by the District and its expenditure accounting records: $15,589 (Project No. 24-4300-00) $12,854 (Project No. 25-4300-00) $4,291 (Project No. 25-4300-00) 13. Context: The condition noted was identified upon reconciling reimbursements claimed by the District to the general ledger accounts in which related expenditures were recorded and investigation of differences identified. 14. Reconmmendation : We recommend that management review its policies and procedures and implement changes to strengthen internal control over compliance. 15. Management's response: The District agrees with the auditor's finding and recommendation.