Audit 381964

A. Finding on Internal Control over Compliance Finding Reference: 2025-001 Federal Agency: U.S. Department of Education Federal Program: IDEA – Part B, Section 611 (84.027) IDEA – Part B, Section 619 (84.173) Compliance Requirement: Activities Allowed or Unallowed Type of Finding: a) Significant Deficiencies in Internal Control Over Compliance b) Compliance Finding Criteria: According to 2 CFR, Part 200.430(i)(1) of the Office of Management and Budget’s Uniform Grant Guidance, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed, which must, among other things: a) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; b) Be incorporated into the official records of the non-Federal entity; c) Reasonably reflect the total activity for which the employee is compensated by the non- Federal entity; d) Encompass both federally assisted and all other activities compensated by the non-Federal entity; e) Support the distribution of the employee’s salary or wages amount specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: District employees whose time was being charged to the grants, who were working both 100% and less than 100% of the time in the federal award program, were required to complete semi-annual or monthly certifications of the percentage of time they worked in each federal award program however, they were not completed timely and not completed by all employees whose time was charged to the grants. In one instance, an employee’s percent of time charged to the grant was greater than the percentage certified. Cause: The School District did not have adequate internal controls in place to ensure that the semi-annual or monthly certifications were being completed by each employee working in the federal award programs timely and accurately. Effect: Without adequate internal controls over the employee’s time being charged to the grant and the certification requirement, the School District cannot ensure that federal funds are paid in accordance with allowable costs and the time worked in the grant. Additionally, they cannot easily monitor the amount of funds that can be charged to the grant for salaries and benefits. Payments that do not agree with the time worked are unallowable and subject to recovery by the grantor. Identification of a Repeat Finding: This is a repeat finding for IDEA, Section 611 (84.027), Section 619 (84.173) from the immediate previous audit, 2024-001. Questioned Costs: The employees’ certifications in questions were reviewed and after reviewing the allocation of each employees’ time it was determined that the time being charged to the grant was appropriate. Additionally, for the one employee whose time charged to the grant was greater than percent of time certified, we determined that the actual time and effort was greater than that charged to the grant and determined that there were no questioned costs. Recommendation: We recommend that the District have proper internal controls in place to ensure that the employees working in the grants are certifying their actual percent of time and effort that is being spent working in the federal award program and completed timely. Monthly certifications should be completed if less than 100% of time is being worked in the federal award program or semiannually if 100% of time is being spent. Internal controls should also be in place to ensure that only those employees who are working in the grant are being charged to the grant. Management Response: The District agrees with the finding and will implement adequate checks and balances to ensure that this problem does not recur. Please refer to the corrective action plan on the following page.