FINDING 2023-002 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Maters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit an annual data report to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period, the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports; however, a single employee prepared and submitted the reports without evidence of a review, or oversight process in place to prevent, or detect and correct, errors. INDIANA STATE BOARD OF ACCOUNTS 17 METROPOLITAN SCHOOL DISTRICT OF MARTINSVILLE SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Additionally, for the ESSER I, Year 2 report, the "Total Mandatory Subgrant Amount Expended in Current Reporting Period" was not supported by the School Corporation's records. Actual expenditures from a report provided by the School Corporation did not tie to the amount submitted for the Annual Performance Reporting. The key line item was determined to be overstated by $80,342. The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the ESSER I, Year 2 report. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.334 states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . . (3) Records that identify adequately the source and application of funds for federallyfunded activities. These records must contain information pertaining to Federal awards, authorizations, financial obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." INDIANA STATE BOARD OF ACCOUNTS 18 METROPOLITAN SCHOOL DISTRICT OF MARTINSVILLE SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, the amounts reported were not supported by the School Corporation's records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure supporting documentation is used and retained for all required reports submitted on behalf of the COVID-19 - Education Stabilization Fund program. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-006 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistant Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were complied, prepared and submitted by one employee without an oversight or review process in place to prevent, or detect and correct, errors. In addition, three of the six reports submitted during the audit period contained errors. The errors were as follows: The ESSER II, Year 1 report was not supported by the School Corporation's records, was not accurate and complete, and was not mathematically accurate. The ESSER II, Year 2 report was not supported by the School Corporation's records, was not accurate and complete, and was not mathematically accurate. Also, expenditures for the key line item of "Supplies" as reported did not agree to the School Corporation's ledger. The ESSER III, Year 2 key line of "Supplies" expenditures did not agree to the School Corporation's ledger. The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the three reports noted above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, ESSER reports were not supported by the School Corporation's records, were not accurate and complete, and were not mathematically accurate. Additionally, key line items were not supported by the records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure supporting documentation is used and retained for all required reports submitted on behalf of the Education Stabilization Fund program funds. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-006 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistant Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were complied, prepared and submitted by one employee without an oversight or review process in place to prevent, or detect and correct, errors. In addition, three of the six reports submitted during the audit period contained errors. The errors were as follows: The ESSER II, Year 1 report was not supported by the School Corporation's records, was not accurate and complete, and was not mathematically accurate. The ESSER II, Year 2 report was not supported by the School Corporation's records, was not accurate and complete, and was not mathematically accurate. Also, expenditures for the key line item of "Supplies" as reported did not agree to the School Corporation's ledger. The ESSER III, Year 2 key line of "Supplies" expenditures did not agree to the School Corporation's ledger. The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the three reports noted above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, ESSER reports were not supported by the School Corporation's records, were not accurate and complete, and were not mathematically accurate. Additionally, key line items were not supported by the records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure supporting documentation is used and retained for all required reports submitted on behalf of the Education Stabilization Fund program funds. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-006 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistant Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were complied, prepared and submitted by one employee without an oversight or review process in place to prevent, or detect and correct, errors. In addition, three of the six reports submitted during the audit period contained errors. The errors were as follows: The ESSER II, Year 1 report was not supported by the School Corporation's records, was not accurate and complete, and was not mathematically accurate. The ESSER II, Year 2 report was not supported by the School Corporation's records, was not accurate and complete, and was not mathematically accurate. Also, expenditures for the key line item of "Supplies" as reported did not agree to the School Corporation's ledger. The ESSER III, Year 2 key line of "Supplies" expenditures did not agree to the School Corporation's ledger. The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the three reports noted above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, ESSER reports were not supported by the School Corporation's records, were not accurate and complete, and were not mathematically accurate. Additionally, key line items were not supported by the records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure supporting documentation is used and retained for all required reports submitted on behalf of the Education Stabilization Fund program funds. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Federal program: Water and Waste Disposal Systems for Rural Communities Assistance listing number: 10.760 Federal agency: U.S. Department of Agriculture Pass-through entity: n/a – direct award Pass-through entity identification number: n/a Type of Finding: Significant deficiency in internal control over compliance. Criteria: Per 2 CFR Section 200.302(b)(6), and 200.302(b)(7), a non-federal agency must establish written procedures related to the following: receipt of payment of federal funds and determination of allowability of costs in accordance with Subpart E – Cost Principles, respectively. Condition: The Town has not formally adopted certain required written financial management policies as outlined in the Code of Federal Regulations. Cause: Town personnel were unaware of this requirement. Effect: Transactions could occur that did not comply with federal regulations. Questioned costs: None Repeat finding: The Town of Bridgewater, Vermont was not required to have a Single Audit for its prior fiscal year. Accordingly, this is not a repeat finding. Perspective information: The finding was based on requesting the Town’s written financial policies related to federal compliance and therefore was not the result of a statistical sample. Recommendation: The auditor recommends that the Town obtain an understanding of the required written policies in the Code of Federal Regulations as applicable to its federal programs, create and formally adopt those required policies.
Federal program: Water and Waste Disposal Systems for Rural Communities Assistance listing number: 10.760 Federal agency: U.S. Department of Agriculture Pass-through entity: n/a – direct award Pass-through entity identification number: n/a Type of Finding: Significant deficiency in internal control over compliance. Criteria: 2 CFR 200.302 “Financial Management” requires the Town’s accounting system to identify all Federal awards received and expended and the Federal program under which they were received. Condition: The Town’s accounting system did not separate Federal expenditures from non-federal expenditures. Cause: Due to change in personnel, different individuals were involved in the Treasury function of the Town during the fiscal year and therefore employees did not have sufficient time, attention, and knowledge to effectively record federal expenditures in the Town’s accounting system. Effect: Federal expenditures are combined with non-federal expenditures in the general ledger. Questioned costs: None Repeat finding: The Town of Bridgewater, Vermont was not required to have a Single Audit for its prior fiscal year. Accordingly, this is not a repeat finding. Perspective information: The Town normally spends less than $750,000 in federal expenditures and therefore usually is not required to have a Single Audit. For 2023, a Single Audit was required due to an emergency wastewater improvement project. Recommendation: The structure of Town’s accounting system should be modified to separate Federal and non-federal expenditures.
FINDING 2023-005 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U200013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by the Assistant Superintendent of Schools and reviewed by the Treasurer prior to submission. However, this review process was not effective and did not detect and allow correction of errors prior to submission. All six of the submitted reports were selected for testing. Four of the reports, ESSER I, Year 2; ESSER II, Year 1; ESSER II, Year 2; and ESSER III, Year 2, were not supported by the School Corporation's records. The financial information provided did not agree to the data submitted in the reports; therefore, we could not determine the accuracy of the reports. 22 INDIANA STATE BOARD OF ACCOUNTS RANDOLPH CENTRAL SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the four reports identified above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." 2 CFR 200.334 states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. 23 INDIANA STATE BOARD OF ACCOUNTS RANDOLPH CENTRAL SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports submitted to the IDOE were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure reports are supported by the ledgers or reports used to complete the report. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-005 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U200013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by the Assistant Superintendent of Schools and reviewed by the Treasurer prior to submission. However, this review process was not effective and did not detect and allow correction of errors prior to submission. All six of the submitted reports were selected for testing. Four of the reports, ESSER I, Year 2; ESSER II, Year 1; ESSER II, Year 2; and ESSER III, Year 2, were not supported by the School Corporation's records. The financial information provided did not agree to the data submitted in the reports; therefore, we could not determine the accuracy of the reports. 22 INDIANA STATE BOARD OF ACCOUNTS RANDOLPH CENTRAL SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the four reports identified above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." 2 CFR 200.334 states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. 23 INDIANA STATE BOARD OF ACCOUNTS RANDOLPH CENTRAL SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports submitted to the IDOE were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure reports are supported by the ledgers or reports used to complete the report. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-005 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U200013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by the Assistant Superintendent of Schools and reviewed by the Treasurer prior to submission. However, this review process was not effective and did not detect and allow correction of errors prior to submission. All six of the submitted reports were selected for testing. Four of the reports, ESSER I, Year 2; ESSER II, Year 1; ESSER II, Year 2; and ESSER III, Year 2, were not supported by the School Corporation's records. The financial information provided did not agree to the data submitted in the reports; therefore, we could not determine the accuracy of the reports. 22 INDIANA STATE BOARD OF ACCOUNTS RANDOLPH CENTRAL SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the four reports identified above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." 2 CFR 200.334 states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. 23 INDIANA STATE BOARD OF ACCOUNTS RANDOLPH CENTRAL SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports submitted to the IDOE were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure reports are supported by the ledgers or reports used to complete the report. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-005 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U200013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by the Assistant Superintendent of Schools and reviewed by the Treasurer prior to submission. However, this review process was not effective and did not detect and allow correction of errors prior to submission. All six of the submitted reports were selected for testing. Four of the reports, ESSER I, Year 2; ESSER II, Year 1; ESSER II, Year 2; and ESSER III, Year 2, were not supported by the School Corporation's records. The financial information provided did not agree to the data submitted in the reports; therefore, we could not determine the accuracy of the reports. 22 INDIANA STATE BOARD OF ACCOUNTS RANDOLPH CENTRAL SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the four reports identified above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." 2 CFR 200.334 states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. 23 INDIANA STATE BOARD OF ACCOUNTS RANDOLPH CENTRAL SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports submitted to the IDOE were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure reports are supported by the ledgers or reports used to complete the report. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-005 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U200013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by the Assistant Superintendent of Schools and reviewed by the Treasurer prior to submission. However, this review process was not effective and did not detect and allow correction of errors prior to submission. All six of the submitted reports were selected for testing. Four of the reports, ESSER I, Year 2; ESSER II, Year 1; ESSER II, Year 2; and ESSER III, Year 2, were not supported by the School Corporation's records. The financial information provided did not agree to the data submitted in the reports; therefore, we could not determine the accuracy of the reports. 22 INDIANA STATE BOARD OF ACCOUNTS RANDOLPH CENTRAL SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the four reports identified above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." 2 CFR 200.334 states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. 23 INDIANA STATE BOARD OF ACCOUNTS RANDOLPH CENTRAL SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports submitted to the IDOE were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure reports are supported by the ledgers or reports used to complete the report. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-005 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U200013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by the Assistant Superintendent of Schools and reviewed by the Treasurer prior to submission. However, this review process was not effective and did not detect and allow correction of errors prior to submission. All six of the submitted reports were selected for testing. Four of the reports, ESSER I, Year 2; ESSER II, Year 1; ESSER II, Year 2; and ESSER III, Year 2, were not supported by the School Corporation's records. The financial information provided did not agree to the data submitted in the reports; therefore, we could not determine the accuracy of the reports. 22 INDIANA STATE BOARD OF ACCOUNTS RANDOLPH CENTRAL SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the four reports identified above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." 2 CFR 200.334 states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. 23 INDIANA STATE BOARD OF ACCOUNTS RANDOLPH CENTRAL SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports submitted to the IDOE were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure reports are supported by the ledgers or reports used to complete the report. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-005 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit an annual data report to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were to be prepared and submitted by the School Principal and reviewed by the Executive Business Director; however, no evidence of this review or oversight process could be provided. As such, the annual data reports were prepared and submitted to the IDOE without an oversight or review process to prevent, or detect and correct, errors. In addition, five of six reports submitted during the audit period were not supported by the School Corporation's records. The following errors were identified: The ESSER I, Year 2 report, which had an applicable reporting period of October 1, 2020 through June 30, 2021, reported $534,761 in expenditures; however, actual expenditures for the applicable reporting period totaled $478,883. The ESSER I, Year 3 report, which had an applicable reporting period of July 1, 2021 to June 30, 2022, reported $0 in expenditures; however, actual expenditures for the applicable reporting period totaled $243,814.67. The ESSER II, Year 1 report, which had an applicable reporting period of July 1, 2020 to June 30, 2021, reported $733 in expenditures; however, actual expenditures for the applicable reporting period totaled $322,539. The ESSER II, Year 2 report, which had an applicable reporting period of July 1, 2021 to June 30, 2022, reported $0 in expenditures; however, actual expenditures for the applicable reporting period totaled $276,642. The ESSER III, Year 2 report, which had an applicable reporting period of July 1, 2021 to June 30, 2022, reported $0 in expenditures; however, actual expenditures for the applicable reporting period totaled $1,315,208. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports were not accurately submitted to the IDOE. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure reports are submitted accurately. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-005 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit an annual data report to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were to be prepared and submitted by the School Principal and reviewed by the Executive Business Director; however, no evidence of this review or oversight process could be provided. As such, the annual data reports were prepared and submitted to the IDOE without an oversight or review process to prevent, or detect and correct, errors. In addition, five of six reports submitted during the audit period were not supported by the School Corporation's records. The following errors were identified: The ESSER I, Year 2 report, which had an applicable reporting period of October 1, 2020 through June 30, 2021, reported $534,761 in expenditures; however, actual expenditures for the applicable reporting period totaled $478,883. The ESSER I, Year 3 report, which had an applicable reporting period of July 1, 2021 to June 30, 2022, reported $0 in expenditures; however, actual expenditures for the applicable reporting period totaled $243,814.67. The ESSER II, Year 1 report, which had an applicable reporting period of July 1, 2020 to June 30, 2021, reported $733 in expenditures; however, actual expenditures for the applicable reporting period totaled $322,539. The ESSER II, Year 2 report, which had an applicable reporting period of July 1, 2021 to June 30, 2022, reported $0 in expenditures; however, actual expenditures for the applicable reporting period totaled $276,642. The ESSER III, Year 2 report, which had an applicable reporting period of July 1, 2021 to June 30, 2022, reported $0 in expenditures; however, actual expenditures for the applicable reporting period totaled $1,315,208. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports were not accurately submitted to the IDOE. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure reports are submitted accurately. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-005 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit an annual data report to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were to be prepared and submitted by the School Principal and reviewed by the Executive Business Director; however, no evidence of this review or oversight process could be provided. As such, the annual data reports were prepared and submitted to the IDOE without an oversight or review process to prevent, or detect and correct, errors. In addition, five of six reports submitted during the audit period were not supported by the School Corporation's records. The following errors were identified: The ESSER I, Year 2 report, which had an applicable reporting period of October 1, 2020 through June 30, 2021, reported $534,761 in expenditures; however, actual expenditures for the applicable reporting period totaled $478,883. The ESSER I, Year 3 report, which had an applicable reporting period of July 1, 2021 to June 30, 2022, reported $0 in expenditures; however, actual expenditures for the applicable reporting period totaled $243,814.67. The ESSER II, Year 1 report, which had an applicable reporting period of July 1, 2020 to June 30, 2021, reported $733 in expenditures; however, actual expenditures for the applicable reporting period totaled $322,539. The ESSER II, Year 2 report, which had an applicable reporting period of July 1, 2021 to June 30, 2022, reported $0 in expenditures; however, actual expenditures for the applicable reporting period totaled $276,642. The ESSER III, Year 2 report, which had an applicable reporting period of July 1, 2021 to June 30, 2022, reported $0 in expenditures; however, actual expenditures for the applicable reporting period totaled $1,315,208. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports were not accurately submitted to the IDOE. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure reports are submitted accurately. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-005 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit an annual data report to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were to be prepared and submitted by the School Principal and reviewed by the Executive Business Director; however, no evidence of this review or oversight process could be provided. As such, the annual data reports were prepared and submitted to the IDOE without an oversight or review process to prevent, or detect and correct, errors. In addition, five of six reports submitted during the audit period were not supported by the School Corporation's records. The following errors were identified: The ESSER I, Year 2 report, which had an applicable reporting period of October 1, 2020 through June 30, 2021, reported $534,761 in expenditures; however, actual expenditures for the applicable reporting period totaled $478,883. The ESSER I, Year 3 report, which had an applicable reporting period of July 1, 2021 to June 30, 2022, reported $0 in expenditures; however, actual expenditures for the applicable reporting period totaled $243,814.67. The ESSER II, Year 1 report, which had an applicable reporting period of July 1, 2020 to June 30, 2021, reported $733 in expenditures; however, actual expenditures for the applicable reporting period totaled $322,539. The ESSER II, Year 2 report, which had an applicable reporting period of July 1, 2021 to June 30, 2022, reported $0 in expenditures; however, actual expenditures for the applicable reporting period totaled $276,642. The ESSER III, Year 2 report, which had an applicable reporting period of July 1, 2021 to June 30, 2022, reported $0 in expenditures; however, actual expenditures for the applicable reporting period totaled $1,315,208. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports were not accurately submitted to the IDOE. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure reports are submitted accurately. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-005 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit an annual data report to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were to be prepared and submitted by the School Principal and reviewed by the Executive Business Director; however, no evidence of this review or oversight process could be provided. As such, the annual data reports were prepared and submitted to the IDOE without an oversight or review process to prevent, or detect and correct, errors. In addition, five of six reports submitted during the audit period were not supported by the School Corporation's records. The following errors were identified: The ESSER I, Year 2 report, which had an applicable reporting period of October 1, 2020 through June 30, 2021, reported $534,761 in expenditures; however, actual expenditures for the applicable reporting period totaled $478,883. The ESSER I, Year 3 report, which had an applicable reporting period of July 1, 2021 to June 30, 2022, reported $0 in expenditures; however, actual expenditures for the applicable reporting period totaled $243,814.67. The ESSER II, Year 1 report, which had an applicable reporting period of July 1, 2020 to June 30, 2021, reported $733 in expenditures; however, actual expenditures for the applicable reporting period totaled $322,539. The ESSER II, Year 2 report, which had an applicable reporting period of July 1, 2021 to June 30, 2022, reported $0 in expenditures; however, actual expenditures for the applicable reporting period totaled $276,642. The ESSER III, Year 2 report, which had an applicable reporting period of July 1, 2021 to June 30, 2022, reported $0 in expenditures; however, actual expenditures for the applicable reporting period totaled $1,315,208. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports were not accurately submitted to the IDOE. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure reports are submitted accurately. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-003 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Indiana Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit an annual data report to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSERI II reports, and two ESSER III reports for a total of six reports. The reports were prepared and submitted by the Finance Manager without a documented oversight or review process. In addition, four of the six annual data reports were not supported by the School Corporation's records. The financial information provided did not agree to the data submitted; therefore, we could not determine the accuracy of the annual data reports. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 17 NORTHWESTERN SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports were not supported by the School Corporation's records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure that the records of the School Corporation support the expenditures reported on the reports submitted on behalf of the COVID-19 - Education Stabilization Fund. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-003 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Indiana Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit an annual data report to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSERI II reports, and two ESSER III reports for a total of six reports. The reports were prepared and submitted by the Finance Manager without a documented oversight or review process. In addition, four of the six annual data reports were not supported by the School Corporation's records. The financial information provided did not agree to the data submitted; therefore, we could not determine the accuracy of the annual data reports. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 17 NORTHWESTERN SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports were not supported by the School Corporation's records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure that the records of the School Corporation support the expenditures reported on the reports submitted on behalf of the COVID-19 - Education Stabilization Fund. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-003 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Indiana Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit an annual data report to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSERI II reports, and two ESSER III reports for a total of six reports. The reports were prepared and submitted by the Finance Manager without a documented oversight or review process. In addition, four of the six annual data reports were not supported by the School Corporation's records. The financial information provided did not agree to the data submitted; therefore, we could not determine the accuracy of the annual data reports. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 17 NORTHWESTERN SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports were not supported by the School Corporation's records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure that the records of the School Corporation support the expenditures reported on the reports submitted on behalf of the COVID-19 - Education Stabilization Fund. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-003 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Indiana Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit an annual data report to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSERI II reports, and two ESSER III reports for a total of six reports. The reports were prepared and submitted by the Finance Manager without a documented oversight or review process. In addition, four of the six annual data reports were not supported by the School Corporation's records. The financial information provided did not agree to the data submitted; therefore, we could not determine the accuracy of the annual data reports. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 17 NORTHWESTERN SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports were not supported by the School Corporation's records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure that the records of the School Corporation support the expenditures reported on the reports submitted on behalf of the COVID-19 - Education Stabilization Fund. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-003 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Indiana Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit an annual data report to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSERI II reports, and two ESSER III reports for a total of six reports. The reports were prepared and submitted by the Finance Manager without a documented oversight or review process. In addition, four of the six annual data reports were not supported by the School Corporation's records. The financial information provided did not agree to the data submitted; therefore, we could not determine the accuracy of the annual data reports. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 17 NORTHWESTERN SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports were not supported by the School Corporation's records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure that the records of the School Corporation support the expenditures reported on the reports submitted on behalf of the COVID-19 - Education Stabilization Fund. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Finding # 2023-002 Program: Various, including AL 20.509 – Formula Grants for Rural Areas and Tribal Transit Program – Reporting Grant Number & Year: Various Federal Grantor Agency: Various, including U.S. Department of Transportation Pass-Through Entity: Various, including Nebraska Department of Transportation Criteria: Title 2 of the U.S. Code of Federal Regulations (CFR) § 200.510(b) (January 1, 2023) states, in part, the following: The auditee must also prepare a schedule of expenditures of Federal awards for the period covered by the auditee’s financial statements which must include the total Federal awards expended as determined in accordance with § 200.502. . . . (2) For Federal awards received as a subrecipient, the name of the passthrough entity and identifying number assigned by the pass-through entity must be included. . . . Title 2 CFR § 200.302(b) (January 1, 2023) states, in relevant part, the following: The financial management system of each non-Federal entity must provide for the following . . . (1) Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. Federal program and Federal award identification must include, as applicable, the Assistance Listings title and number, Federal award identification number and year, name of the Federal agency, and name of the pass-through entity, if any. Title 2 CFR § 200.303 (January 1, 2023) states the following, in relevant part: The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ‘‘Standards for Internal Control in the Federal Government’’ issued by the Comptroller General of the United States or the ‘‘Internal Control Integrated Framework’’, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2 CFR § 200.511(a) (January 1, 2023) requires the auditee to prepare a summary schedule of prior audit findings. Per subsection (b)(2) of that same regulation, “When audit findings were not corrected or were only partially corrected, the summary schedule must describe the reasons for the finding’s recurrence and planned corrective action, and any partial corrective action taken.” The U.S. Department of Transportation adopted the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards in Title 2 CFR § 1201.10 (January 1, 2023). A good internal control plan requires adequate procedures to ensure the Schedule of Expenditures Federal Awards (SEFA) is properly presented and includes all Federal expenditures made by the County during the fiscal year. Condition: Kimball County does not have adequate procedures in place to ensure the SEFA is prepared accurately and includes all Federal expenditures of the County. Consequently, there were numerous errors in the SEFA that were identified by the auditors. A similar finding was noted during the fiscal year 2022 audit. The Summary Schedule of Prior Audit Findings lists the status of this finding as complete. Repeat Finding: Finding # 2022-002 Questioned Costs: None Statistical Sample: No Context: Specifically, we noted the following errors during our audit: • Fiscal year 2023 Federal expenditures of $276,566 were improperly omitted from the SEFA for Assistance Listing 20.509. • Fiscal year 2022 Federal expenditures of $92,389 were improperly included as fiscal year 2023 expenditures for Assistance Listing 20.509. • Non-Federal expenditures of $253,869 were improperly included as Federal Expenditures for Assistance Listing 20.509. These expenditures were paid with State funds and, therefore, should not have been included on the SEFA. • The SEFA provided by Kimball County did not include the assistance listing number to which the expenditures were related, nor did it identify the name of the pass-through entity or the identifying number assigned by the pass-through entity. Corrections were made for these errors after they were identified by the auditors to ensure the SEFA was properly presented. Cause: Kimball County continues to lack personnel with adequate knowledge of Federal reporting and compliance requirements to prepare an accurate SEFA. Effect: Increased risk for the SEFA to be inaccurate, which could lead to Federal sanctions or failure to audit programs that should be audited. Recommendation: We recommend the County work with their pass-through entities to obtain training necessary to understand fully Federal reporting and compliance requirements, including how to prepare the SEFA accurately. View of Officials: The information provided to the auditors regarding the SEFA did contain additional information such as the Federal and State reimbursements for the months before and after the fiscal year. While it is our responsibility to provide just the information required, the information was trackable and accurate per month.
FINDING 2023-009 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Number: 84.425D Federal Award Number and Year (or Other Identifying Number): S425D200013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit an annual data report to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were prepared by the Chief Financial Officer and reviewed by a second knowledgeable individual; however, this process did not allow for the prevention, or detection and correction, of errors prior to submission. INDIANA STATE BOARD OF ACCOUNTS 30 MADISON-GRANT UNITED SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Due to the lack of effective internal controls, one of the six annual data reports was not supported by the School Corporation's records. For the ESSER 1, Year 2 report, which covered the period of October 1, 2020 to June 30, 2021, the School Corporation's records did not support the data reported. The total expenditures were not correct and the key line item did not match to the records of the unit. The lack of internal controls and noncompliance were isolated to the ESSER I, Year 2 report. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, the ESSER I, Year 2 report was not supported by the School Corporation's records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. INDIANA STATE BOARD OF ACCOUNTS 31 MADISON-GRANT UNITED SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure that all expenditures are reported on the reports submitted on behalf of the COVID-19 - Education Stabilization Fund program funds. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report. INDIANA STATE BOARD OF ACCOUNTS 32
2023-002 - Significant Deficiency - Coronavirus State & Local Fiscal Recovery Funds - Lack of Written Policies and Procedures including Suspension & Debarment and Conflict of Interest Federal Expenditures Compliance Requirement: Procurement and Written Policies ALN Number: 21.027 Criteria: Title 2 of the U.S. Code of Federal Regulations (CFR) 180.300 (January 1, 2021) requires non-federal entities to verify an entity is not excluded or disqualified prior to entering into a covered transaction by, "(a) Checking SAM Exclusions; or (b) Collecting a certification from that [entity]; or (c) Adding a clause or condition to the covered transaction with that [entity]." A good internal control plan requires adequate procedures to ensure the County has proper procedures in place to verify that contractors paid with grant funds are not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities. The Uniform Guidance requires nonfederal entities that receive federal awards to establish written policies, procedures, and or/standards of conduct, except if excluded in compliance supplement. There are four basic reasons for creating an internal control system through defining and documenting processes with well-written policies and procedures: 1. Compliance 2. Operational Needs 2. Managing Risks 4. Continuous Improvement Complying with laws and regulations should be a critical funciton of the County. Well-defined and documented processes (i.e. procedures, training manuals) along with records that demonstrate process capability can make evident an effective internal control system and compliance to Federal guidelines. Another important role of documentation of procedures is to ensure processes fundamental to the County are properly guided by County's officials, and are consistent way that meets the County's needs, and that are important related information and data are captured and communicated. Documentation of procedures are important for controlling process, documenting the standard work that was performed and training new employees. Condition: The County lacks certain written policies and procedures required by Uniform Guidance. Although the County has an outdated Accounting Policy, certain policies for Federal Expenditures need to be updated and added. These include: 1. Financial management (200.302) 2. Payment (200.305) 3. General procurement standards (200.318) 4. Competition (200.319) 5. Methods of procurement to be followed (200.320) 6. Compensation - personal services (200.430) 7. Compensation - fringe benefits (200.431) 8. Relocation costs of employees (200.464) 9. Travel costs (200.474) Cause: Appears to be the result of a lack of training coupled with limited staffing and resources. Questioned Costs: None Context for Calculation of Questioned Costs: None Effect: Without adequate procedures to ensure contractors are not suspended, debarred or otherwise excluded from or ineligible for participation in Federal programs or activities, there is an increased risk for the misuse of Federal funds and noncompliance with Federal regulations. Recommendation: We recommend the County implement proceduresto ensure, prior to entering into a covered transaction, that a contractor in not syspended, bebarred, or otherwise excluded from or ineligible for participation in Federal programs or activities, and that procedures is adequately documented. Furthermore, the County should familiarize themselves with the Uniform Guidance and implement the following: 1. Develop and document all of its significant processes over federal awards. 2. Make the written policies and procedures available to all personnel and departments within the County. 3. Ensure the written policies and procedures are accurate, complete, and current at all times (The Board of County Commissioners should update the policy on an annual basis.) 4. Revise policies and procedures for changes in business processes and policies over federal awards. 5. Communicate significant changes to all affected personnel immediately to ensure they are aware of any revisions to their responsibilities to the federal award. 6. Document policies and procedures to facilitate training and provide guidelines relative to federal awards for changes in personnel.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
2023-008 – Internal Controls Over Compliance Federal Program: Refugee and Entrant Assistance Program Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.566 Repeat of Prior Finding: No Type of Finding: Significant Deficiency in Internal Controls Over Compliance Criteria In accordance with 2 CFR § 200.302, the Organizations’ financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statues, regulations, and the terms and conditions of the federal award. Additionally, as required by 2 CFR 200.302(b)(4), the non-federal entity must exercise effective control over, and accountability for, all federal funds. Per 2 CFR. 200.303(a), the non-federal entity should use the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) as a guideline. The COSO guideline indicates that proper segregation of duties between initiating, recording, and authorizing is a best practice as well as retaining documentation of performance and authorization controls. Condition and Context During our audit it was noted that the Organization had inadequate segregation of duties over cash disbursements. Further, written policies concerning cash management practices were not followed and there are no written policies in place regarding written approval of expenses prior to submitting requests for reimbursement. Cause Lack of segregation of incompatible tasks and written policies were not consistently followed. Effect or Potential Effect Lack of internal controls around supervising and authorizing cash management and financial management systems could result in mismanagement of federal funds. Questioned Costs None noted. Recommendations Initiating, authorizing, and recording transaction should not be performed by the same individual. Segregation of incompatible tasks should be implemented so that authorization and review of cash draws of federal or state funds is done by someone other than the individual who initiates and records the transaction. Additionally, there should be written policies in place surrounding cash management. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recommendations. See the attached corrective action plan.
Statement of condition: For the Provider Relief Funds, there were no written policies and procedures. Criteria: Title 2 U.S. Code of Federal Regulations (CFR) 200.302 (b)(6) and (7) states that the non-federal entity must establish written procedures to implement the requirements of 2 CFR 200.305 and written procedures for determining the allowability of costs in accordance with 2 CFR 200 Subpart E as well as terms and conditions of the Federal award. Cause of condition: No controls to establish written policies and procedures when Federal awards are received. Effect of condition: During testing, it was noted that there were no written policies and procedures regarding the Federal award. Context: Policies and procedures were verbally communicated or written during fieldwork to assist with testing. Recommendation: To establish written policies and procedures for Federal awards. Views of responsibile officials and planned corrective actions: Management agrees with this finding and will write policies and procedures for Federal awards.
Finding 2023-006 Information on the federal program: Subject: Education Stabilization Fund (ESSER) – Internal Controls Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 84.425D Federal Award Numbers and Years (or Other Identifying Numbers): 22611-020-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 Financial reporting . . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the reporting compliance requirements. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. Management misinterpreted the instructions for the reporting requirements and believed that they did not need to fill in the expense information as an LEA. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was required to submit one Annual Data Report for each year in the audit period to the Indiana Department of Education (IDOE) to meet federal reporting requirements for ESSER grant awards. There was no documented review by someone other than the preparer of the Annual Data Report to ensure the information submitted was complete and accurate. Additionally, amounts reported on each ESSER I Annual Data Report did not agree to underlying detail for the ESSER I grant. ESSER I was overstated on the Year 2 report by $23,853 and ESSER I was understated on the Year 3 report by $25,761. The finding is isolated to the S425D200013 award (ESSER I). Identification as a repeat finding: No. Recommendation: We recommend someone other than the preparer of the report perform a documented review prior to submission to validate the accuracy and completeness of the data submitted. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
Finding 2023-006 Information on the federal program: Subject: Education Stabilization Fund (ESSER) – Internal Controls Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 84.425D Federal Award Numbers and Years (or Other Identifying Numbers): 22611-020-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 Financial reporting . . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the reporting compliance requirements. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. Management misinterpreted the instructions for the reporting requirements and believed that they did not need to fill in the expense information as an LEA. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was required to submit one Annual Data Report for each year in the audit period to the Indiana Department of Education (IDOE) to meet federal reporting requirements for ESSER grant awards. There was no documented review by someone other than the preparer of the Annual Data Report to ensure the information submitted was complete and accurate. Additionally, amounts reported on each ESSER I Annual Data Report did not agree to underlying detail for the ESSER I grant. ESSER I was overstated on the Year 2 report by $23,853 and ESSER I was understated on the Year 3 report by $25,761. The finding is isolated to the S425D200013 award (ESSER I). Identification as a repeat finding: No. Recommendation: We recommend someone other than the preparer of the report perform a documented review prior to submission to validate the accuracy and completeness of the data submitted. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
2023-003 Internal Control Over Financial Reporting Title and Assistance Listing Number of the Federal Program: 84.425D COVID-19 - Elementary and Secondary School Emergency Relief Fund; 84.425U COVID-19 - American Rescue plan - Elementary and Secondary School Emergency Relief Fiscal Year Finding Originated: 2023 Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Name of Federal Agency: Department of Education Pass-through Agency: Louisiana Department of Education / East Baton Rouge Parish School Board Questioned Costs: No questioned costs reported. Condition: Significant audit adjustments were required to fairly present the consolidated financial statements and related Schedule of Expenditures of Federal Awards (SEFA). Criteria: According to 2 CFR 200.508 “Auditee Responsibilities” the auditee must prepare appropriate financial statements, including the SEFA (as specifically defined under 2 CFR 200.510 “Financial statements”). Title 2 CFR 200.510 “Financial statements” requires recipients of Federal funds to prepare a SEFA for the period covered by the auditee’s financial statements, which must include the total Federal awards expended. In addition, as noted in 2 CFR 200.302 “Financial management”, the financial management system of each non-Federal entity must provide for identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received, and records that identify adequately the source and application of funds for federally-funded activities including expenditures. When federal expenditures are incurred over $750,000, a Single Audit is required to be performed under Uniform Guidance. Failure to properly record federal expenditures could cause the Academies to not have a Single Audit performed, or have it performed improperly, which would be considered noncompliant with Uniform Guidance. Cause: The impacts of the financial statement audit adjustments are as follows: • Accounts receivable and revenue related to Employee Retention Tax Credits were overstated by $600,000. • Revenues and expenditures related to reimbursement-based federal grants included in testing as a major program were understated $426,863. The Academies did not record certain grant revenues and expenditures for expenditures paid directly by the granting agency on behalf of the Academies. This adjustment impacted the SEFA and financial statements. • Revenue related to Child Nutrition Program funds were overstated $19,150. This adjustment impacted the SEFA and financial statements. • Adjustments to property and equipment resulting in a net increase to net assets of $29,583. • Adjustments to accumulated depreciation resulting in a net decrease in net assets of $54,906. • Adjustments to inter-school payable amounts resulting in a net increase in net assets of $23,015. • Adjustments to accounts payable resulting in a net increase in net assets of $60,179. • Adjustments to due to management company resulting in a net increase in net assets of $45,903. • Adjustments to compensated absences resulting in a net decrease in net assets of $24,391. Effect: The consolidated financial statements and related SEFA required material adjustments in order to be presented fairly. A lack of accounting practices can cause potential misstatements to remain unidentified and cause the financial statements and related schedules to be misleading. Noncompliance with Uniform Guidance may result in a temporary suspension of federal awards. Recommendation: We recommend the Academies implement monthly financial statement closing procedures which capture all relevant information necessary to reconcile accounts to supporting documentation on a timely basis. These procedures should include implementing internal controls over recording and monitoring revenues related to federal awards to ensure accuracy of funds recorded. Views of responsible officials: See views of responsible officials on page 36.
2023-003 Internal Control Over Financial Reporting Title and Assistance Listing Number of the Federal Program: 84.425D COVID-19 - Elementary and Secondary School Emergency Relief Fund; 84.425U COVID-19 - American Rescue plan - Elementary and Secondary School Emergency Relief Fiscal Year Finding Originated: 2023 Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Name of Federal Agency: Department of Education Pass-through Agency: Louisiana Department of Education / East Baton Rouge Parish School Board Questioned Costs: No questioned costs reported. Condition: Significant audit adjustments were required to fairly present the consolidated financial statements and related Schedule of Expenditures of Federal Awards (SEFA). Criteria: According to 2 CFR 200.508 “Auditee Responsibilities” the auditee must prepare appropriate financial statements, including the SEFA (as specifically defined under 2 CFR 200.510 “Financial statements”). Title 2 CFR 200.510 “Financial statements” requires recipients of Federal funds to prepare a SEFA for the period covered by the auditee’s financial statements, which must include the total Federal awards expended. In addition, as noted in 2 CFR 200.302 “Financial management”, the financial management system of each non-Federal entity must provide for identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received, and records that identify adequately the source and application of funds for federally-funded activities including expenditures. When federal expenditures are incurred over $750,000, a Single Audit is required to be performed under Uniform Guidance. Failure to properly record federal expenditures could cause the Academies to not have a Single Audit performed, or have it performed improperly, which would be considered noncompliant with Uniform Guidance. Cause: The impacts of the financial statement audit adjustments are as follows: • Accounts receivable and revenue related to Employee Retention Tax Credits were overstated by $600,000. • Revenues and expenditures related to reimbursement-based federal grants included in testing as a major program were understated $426,863. The Academies did not record certain grant revenues and expenditures for expenditures paid directly by the granting agency on behalf of the Academies. This adjustment impacted the SEFA and financial statements. • Revenue related to Child Nutrition Program funds were overstated $19,150. This adjustment impacted the SEFA and financial statements. • Adjustments to property and equipment resulting in a net increase to net assets of $29,583. • Adjustments to accumulated depreciation resulting in a net decrease in net assets of $54,906. • Adjustments to inter-school payable amounts resulting in a net increase in net assets of $23,015. • Adjustments to accounts payable resulting in a net increase in net assets of $60,179. • Adjustments to due to management company resulting in a net increase in net assets of $45,903. • Adjustments to compensated absences resulting in a net decrease in net assets of $24,391. Effect: The consolidated financial statements and related SEFA required material adjustments in order to be presented fairly. A lack of accounting practices can cause potential misstatements to remain unidentified and cause the financial statements and related schedules to be misleading. Noncompliance with Uniform Guidance may result in a temporary suspension of federal awards. Recommendation: We recommend the Academies implement monthly financial statement closing procedures which capture all relevant information necessary to reconcile accounts to supporting documentation on a timely basis. These procedures should include implementing internal controls over recording and monitoring revenues related to federal awards to ensure accuracy of funds recorded. Views of responsible officials: See views of responsible officials on page 36.
Type of Finding: Material Weakness Criteria: 2 CFR Section 200.302 of the Uniform Guidance requires that a non-federal entity provide for accurate, current, and complete disclosure of the financial results of each Federal award or program. Additionally, 2 CFR Section 200.303 of the Uniform Guidance requires the non-Federal entity to establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and the terms and conditions of the Federal award. Condition: We identified the following issues during our audit procedures over the SEFA and federal grant expenditure reports (SEFA project rollout): The preliminary SEFA provided by the Agency excluded eight federal programs with approximately $779,000 of federal revenues. The preliminary SEFA provided by the Agency contained various inaccuracies for contract numbers and contract periods, which resulted in various corrections subsequent to receipt of the preliminary SEFA. Thirty-two project reports for cost reimbursable federal grants contained variances over $25,000 between federal revenues and expenditures. Through procedures performed in other audit areas, we identified approximately $908,000 of contract labor invoices and expenditures not accrued on the Agency’s consolidated financial statements and excluded from the preliminary SEFA. These expenditures were related to the Emergency Food and Shelter Program (EFSP) (ALN #97.024). The Agency received advanced funding throughout the year from FEMA for operating the Centro De Bienvenida (CDB). The complete and final reconciliation for federal grant deferred revenues to account for the balance of advanced funds was not timely provided at the start of audit fieldwork. Various adjustments were pending to deferred revenue accounts, specifically EFSP-allowable expenditures for the CDB and reversal of prior year deferred revenues for expenditures incurred in the current year. This resulted in approximately $490,000 of adjustments to deferred revenue accounts during the audit. The Agency identified approximately $123,000 of disallowed expenditures, which required reclassification from the CDB federal project code to general funds. This amount was not provided until after completion of the Agency’s expense receipt review project which was after the start of audit fieldwork. The specific issues and/or observations noted above included material adjustments proposed during the audit to properly reconcile the federal award expenditures and obtain a complete and accurate SEFA. These adjustments and findings also resulted in four versions of the SEFA received by the auditor throughout our audit procedures. Cause: Lack of timely review and oversight of federal project expenditures, including the SEFA rollout report. In addition, the preliminary SEFA and underlying support was not timely reviewed by management after it was prepared by accounting staff. Effect or potential effect: Not implementing a timely review of federal grant expenditures (SEFA rollout report) and deferred revenue reconciliations, including information contained in the SEFA, increases the risk of material errors to the consolidated financial statements that would not be detected by management in a timely manner. Recommendation: We recommend the Agency implement adequate and timely oversight of federal grant expenditures to ensure proper compliance with federal expenditure reporting and SEFA preparation. We understand that the agency’s federal grant budget significantly increased during the fiscal year with the operation of the CDB. Thus, it is expected that increased federal funding levels would require more levels oversight to ensure compliance with proper financial management of the grants. Repeat Finding: No Questioned Costs: None Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding. See Corrective Action Plan.
Type of Finding: Material Weakness Criteria: 2 CFR Section 200.302 of the Uniform Guidance requires that a non-federal entity provide for accurate, current, and complete disclosure of the financial results of each Federal award or program. Additionally, 2 CFR Section 200.303 of the Uniform Guidance requires the non-Federal entity to establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and the terms and conditions of the Federal award. Condition: We identified the following issues during our audit procedures over the SEFA and federal grant expenditure reports (SEFA project rollout): The preliminary SEFA provided by the Agency excluded eight federal programs with approximately $779,000 of federal revenues. The preliminary SEFA provided by the Agency contained various inaccuracies for contract numbers and contract periods, which resulted in various corrections subsequent to receipt of the preliminary SEFA. Thirty-two project reports for cost reimbursable federal grants contained variances over $25,000 between federal revenues and expenditures. Through procedures performed in other audit areas, we identified approximately $908,000 of contract labor invoices and expenditures not accrued on the Agency’s consolidated financial statements and excluded from the preliminary SEFA. These expenditures were related to the Emergency Food and Shelter Program (EFSP) (ALN #97.024). The Agency received advanced funding throughout the year from FEMA for operating the Centro De Bienvenida (CDB). The complete and final reconciliation for federal grant deferred revenues to account for the balance of advanced funds was not timely provided at the start of audit fieldwork. Various adjustments were pending to deferred revenue accounts, specifically EFSP-allowable expenditures for the CDB and reversal of prior year deferred revenues for expenditures incurred in the current year. This resulted in approximately $490,000 of adjustments to deferred revenue accounts during the audit. The Agency identified approximately $123,000 of disallowed expenditures, which required reclassification from the CDB federal project code to general funds. This amount was not provided until after completion of the Agency’s expense receipt review project which was after the start of audit fieldwork. The specific issues and/or observations noted above included material adjustments proposed during the audit to properly reconcile the federal award expenditures and obtain a complete and accurate SEFA. These adjustments and findings also resulted in four versions of the SEFA received by the auditor throughout our audit procedures. Cause: Lack of timely review and oversight of federal project expenditures, including the SEFA rollout report. In addition, the preliminary SEFA and underlying support was not timely reviewed by management after it was prepared by accounting staff. Effect or potential effect: Not implementing a timely review of federal grant expenditures (SEFA rollout report) and deferred revenue reconciliations, including information contained in the SEFA, increases the risk of material errors to the consolidated financial statements that would not be detected by management in a timely manner. Recommendation: We recommend the Agency implement adequate and timely oversight of federal grant expenditures to ensure proper compliance with federal expenditure reporting and SEFA preparation. We understand that the agency’s federal grant budget significantly increased during the fiscal year with the operation of the CDB. Thus, it is expected that increased federal funding levels would require more levels oversight to ensure compliance with proper financial management of the grants. Repeat Finding: No Questioned Costs: None Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding. See Corrective Action Plan.