Audit 400285

Criteria: Per 2 CFR Section 200.305(b)(9) and North Carolina Administrative Code, the portion of any sales tax refunds received that pertain to federal funds administered by the North Carolina Department of Public Instruction (NC DPI) must be refunded to the appropriate federal program that paid the sales tax. Condition: Sales tax refunds received were not refunded to the appropriate federal program that paid the sales tax. Cause: Internal controls were not adequately designed and implemented to ensure that sales tax refunds received were refunded to the appropriate federal program that paid the sales tax Effect: The Local Education Agency (LEA) may be required to reimburse the overpayment of federal funds to NC DPI. Questioned Costs: $189,016 - All sales tax refunds received which pertain to federal programs. Recommendation: Internal controls should be adequately designed and implemented to ensure that sales tax refunds are appropriately refunded to the program that paid the sales tax. Views of responsible officials: The Board agrees with this finding and has set forth a correc􀀁ve ac􀀁on pl an. Corrective Action: The Board will implement internal controls over sales tax refunds of federal programs to ensure any such amounts are appropriately applied to the program(s).