FINDING 2023-001
Finding Subject: Emergency Connectivity Fund Program - Allowable Costs/Cost Principles, Special
Tests and Provisions - Restricted Purpose
Summary of Finding: The Emergency Connectivity Fund (ECF) Program established by the American
Rescue Plan Act of 2021 was for the purchase of eli...
FINDING 2023-001
Finding Subject: Emergency Connectivity Fund Program - Allowable Costs/Cost Principles, Special
Tests and Provisions - Restricted Purpose
Summary of Finding: The Emergency Connectivity Fund (ECF) Program established by the American
Rescue Plan Act of 2021 was for the purchase of eligible equipment, advanced communications, and
information services for use by students, school staff, and library patrons at locations that include locations
other than at a school or library. The ECF Program provides funding to meet the remote learning needs of
students, school staff, and library patrons who would otherwise lack access to connected devices and
broadband connections sufficient to engage in remote learning during the COVID-19 emergency period.
To ensure that funding is focused on unmet need, the grantor agency requires schools to certify, as part of
their funding application, that they are only seeking support for eligible equipment and/or broadband
connectivity to provide to students and school staff who would otherwise lack access to connected devices
and/or broadband connectivity sufficient to engage in remote learning. The unmet need at the time of the
funding application can be based on an estimate. However, when the School Corporation files the request for
reimbursement only equipment and services provided to students or school staff who would otherwise lack
broadband services and/or devices sufficient to engage in remote learning should be requested.
The School Corporation made four reimbursement requests during the audit period. All four reimbursement
requests were selected for testing to verify the expenditures were in conformance with the applicable cost
principles. Of the four reimbursement requests tested, issues were identified with three of the reimbursement
requests. The issues identified were as follows:
1) For two reimbursement requests the amount requested, in total, exceeded the expenditures posted to the
grant fund. The total amount requested for reimbursement was $616,800; however, total expenditures in the
fund were $615,400. As such, the amount requested and received exceeded the amount spent out of the
grant fund by $1,400. The School Corporation did not perform a reconciliation, which would have identified
the error and allowed them to move the associated expenses to the grant fund, nor did the School
Corporation return the additional funds to the grantor agency. At the end of the audit period, the $1,400 was
included in the fund’s overall ending cash balance.
2) For one reimbursement request, although an invoice was submitted as evidence of expenditures, the
funding received from the grantor agency was not used to pay this invoice. Instead, the School Corporation
paid for that invoice using a lease program and opted instead to use the funding received over the course of
the next five years to cover maintenance and service costs for school technology. This information was not
disclosed with the initial reimbursement request, nor has a substitution request been sent to the awarding
agency. The amount received from the grantor agency and not paid to the vendor, $500,000, will be
considered questioned costs. At the end of the audit period, this money had not been expended, and was
included in the fund’s overall ending cash balance to be used for future maintenance and service costs for
school technology.
INDIANA STATE BOARD OF ACCOUNTS
33
Contact Person Responsible for Corrective Action: Troy Cloum
Contact Phone Number and Email Address: 765-771-6065 tcloum@lsc.k12.in.us
Views of Responsible Officials:
Option 1: We concur with the finding. The corporation will develop, outline, and communicate internal
control procedures to ensure that grant funds are spent on authorized purchases, that reimbursements
are requested only for the amounts actually expended, and that the documentation utilized for seeking
reimbursement is allowable and accurate.
Description of Corrective Action Plan:
1. The Chief Financial Officer shall review the Internal Control Manual and develop a proper policy and
procedure for Grant Purchases and for Grant Reimbursements.
2. The Chief Financial Officer will meet with each Grant Administrator to review the procedures and
purchasing guidelines.
3. The Chief Financial Officer will meet with the Business Office Staff and review the procedures and
purchasing guidelines.
4. Signed attendance logs for each training shall be collected and recorded.
Anticipated Completion Date:
The projected completion date is March 22, 2024.