Audit 392933

Finding #2025-001 – Material Audit Adjustments Criteria: Proper financial closing and year-end reconciliation procedures should be in place to identify and adjust the financial records to ensure the financial statements are fairly stated. Condition: The auditors proposed audit adjustments that, if not made, would have resulted in the financial statements being materially misstated. Cause: Financial information was not recorded in a timely manner and material adjustments were needed in order to correct various transactions. Effect: The District’s system of internal control may not prevent, detect, or correct misstatements in the financial statements. Financial reports generated by the accounting system may not provide an accurate reflection of the District’s financial position or activities. Not reconciling accounts on a timely basis could lead to errors or other problems not being recognized and resolved. Recommendation: Policies and procedures should be implemented to ensure account balances are properly recorded and reconciled in a timely manner. Response: The District acknowledges their responsibility for the financial statements and recording of the current year activity. Going forward, the District will verify that all activity is completely and accurately recorded in the financial records and reflected on the financial statements.

2025-002 – Time and Effort Reporting Finding: # Assistance Listing/Program Title: #84.027A/IDEA Flow Through and #84.173A/Preschool Entitlement (Special Education Cluster) Federal Agency/Pass-Through Entity: U.S Department of Education/Wisconsin Department of Instruction Award Numbers/Year: 2025-133332-DPI-FLOW-341 and 2025-133332-DPI-PRESCH-347/2024-2025 Criteria: In accordance with the federal Uniform Guidance, charges to federal awards for salaries and benefits must be based on records that accurately reflect the work performed. Such records must be supported by time and effort documentation. Condition: During the auditors’ testing of payroll charges, it was noted that the District did not maintain adequate time and effort documentation to support the allocation of salaries and benefits to the Special Education Cluster. Specifically, one employee’s time was coded to the Special Education Cluster at a fixed 10% allocation. Cause: The District did not have adequate internal controls to ensure required time and effort documentation was consistently obtained and maintained for all employees whose salaries and benefits were charged to the Special Education Cluster. Staff turnover and lack of training contributed to inconsistent application of federal requirements. Effect: Because required time and effort documentation was not properly maintained, salaries and benefits charged to the Special Education Cluster may not accurately reflect actual time spent working on the program. As a result, these costs are unallowable under the Uniform Guidance. Questioned Costs: The absence of proper documentation results in questioned costs of $7,037, representing the salary and benefit amounts charged to the program for the one employee without adequate support. Recommendation: The auditor recommends that the District strengthen internal controls over time and effort reporting to ensure all employees funded in whole or in part by federal programs complete required documentation in accordance with Uniform Guidance. Additionally, a monitoring process should be implemented to ensure time distribution reports are completed accurately, signed timely, and retained in accordance with record-keeping requirements. Response: Management concurs with the finding and will implement internal control improvements to ensure full compliance with federal time and effort documentation requirements.