2024-002 WRITTEN POLICIES REQUIRED BY UNIFORM GRANT GUIDANCE Programs: Assistance to Firefighters Grants; U.S. Department of Homeland Security; ALN 97.044 Airport Improvement Program; U.S. Department of Transportation; ALN 20.106; All Award Numbers Condition: The City has not adopted federal policies as required by the Uniform Guidance (2 CFR Part 200). Key policies, including, but not limited to, procurement, subrecipient monitoring, and financial management, have not been implemented in accordance with federal standards. Criteria: Uniform Guidance mandates that entities expending federal awards comply with federal policies and procedures to ensure proper management and accountability of federal funds. Specifically, 2 CFR 200.302(b) and 200.318 require entities to implement adequate financial and procurement management systems. Cause: The City lacks formal processes to update and align its internal policies with Uniform Guidance requirements, leading to gaps in federally compliant procedures. Effect: Noncompliance with the Uniform Guidance could result in improper use or oversight of federal funds, increasing the risk of audit findings, potential disallowed costs, and jeopardizing future federal funding. Questioned Costs: No costs were required to be questioned as a result of this finding inasmuch as our testing did not reveal any unallowable costs or excess cash draws. Recommendation: Management should establish and implement federal-compliant policies, specifically focusing on procurement, financial management, and subrecipient monitoring, to ensure full alignment with Uniform Guidance requirements. Periodic policy reviews should be conducted to ensure continued compliance. View of Responsible Officials: Management agrees with the finding and will create appropriate policies and procedures to alleviate the finding from re-occurring.
Reference Number: 2024-003 Description: Written Procedures Condition and Criteria: At the beginning of the audit period, the District did not have a Federal Funds Manual in place to document policies and procedures for managing federal awards in compliance 2 CFR 200, Subparts D and E. The Uniform Guidance requires the following written procedures: Written procedures for grant financial management (2 CFR 200.302 and 2 CFR 200.305) Written procurement policy (2 CFR 200.318a) Written procedures for allowable costs (2 CFR 200.403) Written procedures for managing and safeguarding property or equipment acquired with federal funds (2 CFR 200.313) During the course of the audit, the District developed and implemented a Federal Funds Manual to address this deficiency. Cause: There was an administrative oversight of ensuring the District had these written procedures in place. Effect: The absence of a documented Federal Funds Manual increased the risk of noncompliance with federal requirements and ineffective management of federal funds. However, the district’s subsequent implementation of the manual before the audit’s completion reduced this risk. Recommendation: We recommend that the District continue to utilize and periodically review the Federal Funds Manual to ensure it remains comprehensive and up-to-date with changes in federal requirements. Views of Responsible Officials and Corrective Action: See Corrective Action Plan.
Reference Number: 2024-003 Description: Written Procedures Condition and Criteria: At the beginning of the audit period, the District did not have a Federal Funds Manual in place to document policies and procedures for managing federal awards in compliance 2 CFR 200, Subparts D and E. The Uniform Guidance requires the following written procedures: Written procedures for grant financial management (2 CFR 200.302 and 2 CFR 200.305) Written procurement policy (2 CFR 200.318a) Written procedures for allowable costs (2 CFR 200.403) Written procedures for managing and safeguarding property or equipment acquired with federal funds (2 CFR 200.313) During the course of the audit, the District developed and implemented a Federal Funds Manual to address this deficiency. Cause: There was an administrative oversight of ensuring the District had these written procedures in place. Effect: The absence of a documented Federal Funds Manual increased the risk of noncompliance with federal requirements and ineffective management of federal funds. However, the district’s subsequent implementation of the manual before the audit’s completion reduced this risk. Recommendation: We recommend that the District continue to utilize and periodically review the Federal Funds Manual to ensure it remains comprehensive and up-to-date with changes in federal requirements. Views of Responsible Officials and Corrective Action: See Corrective Action Plan.
Reference Number: 2024-003 Description: Written Procedures Condition and Criteria: At the beginning of the audit period, the District did not have a Federal Funds Manual in place to document policies and procedures for managing federal awards in compliance 2 CFR 200, Subparts D and E. The Uniform Guidance requires the following written procedures: Written procedures for grant financial management (2 CFR 200.302 and 2 CFR 200.305) Written procurement policy (2 CFR 200.318a) Written procedures for allowable costs (2 CFR 200.403) Written procedures for managing and safeguarding property or equipment acquired with federal funds (2 CFR 200.313) During the course of the audit, the District developed and implemented a Federal Funds Manual to address this deficiency. Cause: There was an administrative oversight of ensuring the District had these written procedures in place. Effect: The absence of a documented Federal Funds Manual increased the risk of noncompliance with federal requirements and ineffective management of federal funds. However, the district’s subsequent implementation of the manual before the audit’s completion reduced this risk. Recommendation: We recommend that the District continue to utilize and periodically review the Federal Funds Manual to ensure it remains comprehensive and up-to-date with changes in federal requirements. Views of Responsible Officials and Corrective Action: See Corrective Action Plan.
Information on the federal program: U.S. Department of Treasury, Assistance Listing No. 21.027 COVID-19 Coronavirus Fiscal Recovery Funds Criteria: 2 CFR 200.302 and 2 CFR 200.303 require entities to establish and maintain internal controls and financial management procedures to provide reasonable assurance the award is managed in compliance with statutes, regulations, and terms and conditions of the award and to ensure federal award expenditures are adequately supported by source documentation. Condition: We tested controls over disbursements to 11 hospitals during the year. For each hospital to receive funding they were to submit a staffing spreadsheet reporting their increased staffing costs due to COVID. Of the 11 tested, supporting documentation for 3 hospitals was not readily available. Additional information had to be obtained from the hospital to support the information reported by the hospital in the staffing spreadsheet. Cause: Salary information obtained in support of the staffing spreadsheet included Employees Quarterly Federal Tax Return (941) and payroll registers. Additional general ledger information had to be requested from the hospitals during the audit to reconcile to the amounts reported in the staffing spreadsheet. Effect: Internal Controls were not properly implemented to obtain source documentation to adequately support the amounts reported by the hospitals as additional staffing costs. Recommendation: We recommend the Organization strengthen its policies and procedures surrounding disbursements to hospitals to ensure the amounts reported were accurate and source documentation is retained to ensure compliance requirements. Views of Responsible Officials and Planned Corrective Action: Management agrees with the findings. See Management’s View and Corrective Action Plan included at the end of the report.
FINDING 2024-003 Information on the federal program: Subject: COVID-19 – Education Stabilization Fund – Reporting Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425U210013 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 District in order to ensure compliance with requirements related to the grant agreement and the Reporting compliance requirements. Cause: The School District's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. Effect: The failure to establish an effective internal control system placed the School District 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 had not designed nor implemented a system of internal control to ensure that the annual Elementary and Secondary School Emergency Relief (ESSER) annual Data Collection reports (Reports) were complete and accurately submitted. The reports were prepared and submitted in JotForm, the online application used by the Indiana Department of Education to collect information, without an oversight or secondary review process in place to prevent, or detect and correct, errors. During tie out of the Year 3 report, a variance between the underlying records and reported expenditures of $187,649 was noted due to the lack of effective controls surrounding annual data reporting. 84.425U expenditures submitted within the Year 3 report were overstated by $187,649. Identification as a repeat finding: Yes, see Finding 2022-001. Recommendation: We recommend someone other than the preparer of the report perform a documented, secondary review of the report information 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 Number 2024-006: Criteria or specific requirement: The District should maintain records that sufficiently identify the amount, source, and expenditure of Federal funds for Federal awards in accordance with 2 CFR 200.302(b)(3). Condition: The District did not maintain records that contain information necessary to identify Federal expenditures supported by source documentation. Questioned Costs: $5,200 Context: A Federal grant expenditure was claimed twice on the same grant expenditure report. Effect: Due to the same Federal grant expenditure being double-reported on the same grant expenditure report, actual grant expenditures were overstated. Cause: The same Federal grant expenditure was claimed twice (on two different line items) in the final grant expenditure report. Recommendation: The District should always maintain records that sufficiently identify the amount, source, and expenditure of Federal funds for Federal awards. These records must contain information necessary to identify Federal expenditures. All records must be supported by source documentation. Management's Response: The District will work to ensure that records are maintained that sufficiently identify the amount, source and expenditure of Federal funds for Federal awards. Grant expenditure reports will be reviewed to make sure Federal award expenditures are not double-reported.
2024-001 Internal Control over Compliance and Compliance with Reporting (Preparation of the Schedule of Expenditures of Federal Awards (SEFA)) Information on the Major Federal Programs: Department of Housing and Urban Development Federal Assistance Listing Number: 14.218 Federal Assistance Listing Name: Community Development Block Grants/Entitlement Grants Grant Number: CV-2-8 Department of Health and Human Services Federal Assistance Listing Number: 93.566 Federal Assistance Listing Name: Refugee and Entrant Assistance - State-Administered Programs Grant Number: JA-FSA-RSS-2022 Criteria: Title 2 U.S. Code of Federal Regulations Part 200 (2 CFR part 200) Section §200.510(b) states in part: “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 CFR Section §200.502 Basis for determining Federal awards expended.” The schedule must provide total federal awards expended for each individual Federal program. In accordance with §200.302 Financial Management, a non-Federal entity's 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 statutes, regulations, and the terms and conditions of the Federal award. 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. (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 §200.327 Financial Reporting and §200.328 Monitoring and Reporting Program Performance. (3) Records that identify adequately the source and application of funds for Federally-funded activities. (4) Effective control over, and accountability for, all funds, property, and other assets.
2024-001 Internal Control over Compliance and Compliance with Reporting (Preparation of the Schedule of Expenditures of Federal Awards (SEFA)) Information on the Major Federal Programs: Department of Housing and Urban Development Federal Assistance Listing Number: 14.218 Federal Assistance Listing Name: Community Development Block Grants/Entitlement Grants Grant Number: CV-2-8 Department of Health and Human Services Federal Assistance Listing Number: 93.566 Federal Assistance Listing Name: Refugee and Entrant Assistance - State-Administered Programs Grant Number: JA-FSA-RSS-2022 Criteria: Title 2 U.S. Code of Federal Regulations Part 200 (2 CFR part 200) Section §200.510(b) states in part: “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 CFR Section §200.502 Basis for determining Federal awards expended.” The schedule must provide total federal awards expended for each individual Federal program. In accordance with §200.302 Financial Management, a non-Federal entity's 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 statutes, regulations, and the terms and conditions of the Federal award. 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. (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 §200.327 Financial Reporting and §200.328 Monitoring and Reporting Program Performance. (3) Records that identify adequately the source and application of funds for Federally-funded activities. (4) Effective control over, and accountability for, all funds, property, and other assets.
2024-001 Internal Control over Compliance and Compliance with Reporting (Preparation of the Schedule of Expenditures of Federal Awards (SEFA)) Information on the Major Federal Programs: Department of Housing and Urban Development Federal Assistance Listing Number: 14.218 Federal Assistance Listing Name: Community Development Block Grants/Entitlement Grants Grant Number: CV-2-8 Department of Health and Human Services Federal Assistance Listing Number: 93.566 Federal Assistance Listing Name: Refugee and Entrant Assistance - State-Administered Programs Grant Number: JA-FSA-RSS-2022 Criteria: Title 2 U.S. Code of Federal Regulations Part 200 (2 CFR part 200) Section §200.510(b) states in part: “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 CFR Section §200.502 Basis for determining Federal awards expended.” The schedule must provide total federal awards expended for each individual Federal program. In accordance with §200.302 Financial Management, a non-Federal entity's 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 statutes, regulations, and the terms and conditions of the Federal award. 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. (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 §200.327 Financial Reporting and §200.328 Monitoring and Reporting Program Performance. (3) Records that identify adequately the source and application of funds for Federally-funded activities. (4) Effective control over, and accountability for, all funds, property, and other assets.
SIGNIFICANT DEFICENCY AND MATERIAL NONCOMPLIANCE Internal Controls and Report Submissions Criteria: Pursuant to the Code of Federal Regulations (CFR), Title 2 Grants and Agreements, Subpart D Post Federal Award Requirements, Section 200.303 “the non-federal entity must 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.” Also pursuant to the Code of Federal Regulations (CFR), Title 2 Grants and Agreements, Subpart D Post Federal Award Requirements, Section 200.302 Financial Management (2 CFR §200.302), “identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received.” Condition: When investigating the controls related to Education Stabilization Fund reporting to the State of Kanas, we became aware that the same individual compiling the information is the same submitting the reports with no secondary review. During our examination of the reports submitted for the fiscal year, the report for the quarter ending June 2024 did not back to financial records by approximately $60.989. Cause: The controls related to reporting for Education Stabilization Fund are non-existent. Effect: There is no internal control related to reporting for Education Stabilization Fund. Questioned Costs: $60,989 Recommendations: The District should have an employee compare the Board Clerk’s supporting documentation and the Education Stabilization Fund spreadsheet report before its submission to the State of Kansas for its accuracy. After the approval by the secondary review employee, the report submitted should be printed, initialed by the secondary reviewer, stapled with the information used to compile the report and combined with all financial records for the fiscal year. Views of Responsible Officials and Planned Corrective Actions: The District agrees with the finding. See separate document for planned corrective actions.
Criteria - 2 CFR Part 200, Subpart D, paragraph 200.302 (b)(3) - Maintaining records that sufficiently identify the amount, source, and expenditure of Federal funds for Federal awards. These records must contain information necessary to identify Federal awards, authorizations, financial obligations, unobligated balances, as well as assets, expenditures, income, and interest. All records must be supported by source documentation. Condition - Expenditures were claimed as federal expenditures for the purchase of supplies even though the purchase agreement had not been fulfilled and supported by appropriate source documentation. Questioned Costs - Expenditiures in the amount of $258,750 for incomplete purchase transactions were reported to the grantor. Context - Supplies for the federal program were budgeted, ordered and approved, but due to delays in delivery by the vendor, the orders were not completed by the end of the fiscal year. Checks were prepared in anticipation of completion of the orders and expenditures were recorded and reported to the grantor even though the prepared checks were held by management. Effect - Program expenditures were overstated by $258,750. Cause -The procedures for approval and preparation of payment for supplies were completed even though the supply purchase agreement had not been fulfilled. Recommendation - The District should amend and submit corrected reports to the Grantor. Any expenditure reimbursements received should be refunded to the Grantor. Procedures for payment of supplies should not be completed until the purchase agreement terms have been fulfilled by the vendor. Management's response - All funds have been refunded to state agency and expense reports amended appropriately.
2024-003: Material Weakness in Internal Control / Material Noncompliance – Cash Management (repeat comment) Federal Program: Employment Services Cluster (ALN 17.207/17.801) Criteria: 2 CFR 200.305(b) states, in part: “For Non-Federal entities payment methods must minimize the time elapsing between the transfer of funds from the United States Treasury or the pass-through entity and the disbursement by the non-Federal entity…” 2 CFR 200.305(b)(2)(ii) states, in part: “Non-Federal entities must be authorized to submit requests for advance payments and reimbursements….”. 2 CFR 200.302(b)(6) states, in part: “the financial management system of each non-Federal entity must provide for written procedures to implement the requirements of 2 CFR 200.305 – Federal Payment”. Condition: 1) The Consortium requested funds in advance of when the related disbursements were made, 2) the basis for the advances (requests) were not supported by appropriate documentation, and 3) authorization for requesting funds in advance was not obtained. Context: The total amount of funds overdrawn as of year-end totaled $173,888. Cause: Management oversight. Effect: Funds were requested and received in advance of when the related payments were disbursed without obtaining authorization for advance payments, and without properly documenting the basis for the requested funds. Consequently, the Consortium did not minimize the time elapsing between the transfer of funds from the United States Treasury or the pass-through entity and the disbursement by the non-Federal entity. Recommendation: The Consortium should carefully review their policies and procedures and make the necessary changes to assure that cash draws are based on expenditures already incurred and they are supported by transactions recorded in the books and records of the Consortium. Views of Responsible Officials: We agree with the finding.
2024-004: Significant Deficiency in Internal Control / Immaterial Noncompliance – Cash Management (repeat comment) Federal Program: WIOA Cluster (ALN 17.258/17.259/17.278) Criteria: 2 CFR 200.305(b) states, in part: “For Non-Federal entities payment methods must minimize the time elapsing between the transfer of funds from the United States Treasury or the pass-through entity and the disbursement by the non-Federal entity…” 2 CFR 200.305(b)(2)(ii) states, in part: “Non-Federal entities must be authorized to submit requests for advance payments and reimbursements….”. 2 CFR 200.302(b)(6) states, in part: “the financial management system of each non-Federal entity must provide for written procedures to implement the requirements of 2 CFR 200.305 – Federal Payment”. Condition: 1) The Consortium requested funds in advance of when the related disbursements were made, 2) the basis for the advances (requests) were not supported by appropriate documentation, and 3) authorization for requesting funds in advance was not obtained. Context: The total amount of funds overdrawn as of year-end totaled $199,778. Cause: Management oversight. Effect: Funds were requested and received in advance of when the related payments were disbursed without obtaining authorization for advance payments, and without properly documenting the basis for the requested funds. Consequently, the Consortium did not minimize the time elapsing between the transfer of funds from the United States Treasury or the pass-through entity and the disbursement by the non-Federal entity. Recommendation: The Consortium should carefully review their policies and procedures and make the necessary changes to assure that cash draws are based on expenditures already incurred and they are supported by transactions recorded in the books and records of the Consortium. Views of Responsible Officials: We agree with the finding.
Federal Agency: U.S. Department of Education Passthrough Entity: Missouri Department of Elementary and Secondary Education Assistance Listing Number and Federal Program: 84.425U American Rescue Plan Elementary and Secondary School Emergency Relief Compliance Requirement: B. Allowable Costs Criteria: The District is responsible for the efficient and effective administration of federal awards though the application of sound management practices. 2 CFR Section 200.302 discusses the importance of a financial management system and records that identify adequately the source and applications of funds for federally funded activities. There should be effective control over, and accountability for all funds. Statement of Condition: During our testing of ESSER III grants, it was noted that the District requested more for purchased services than was shown as expended in the District’s accounting records. Statement of Cause: The District does not have the appropriate internal controls in place to review expenditures claimed under each grant within the program. As a result, the District was required to reclassify certain purchased service expenditures from one project code to another to meet a state requirement. However, these expenditures had already been reported on the ESSER III expenditure report. Therefore, due to the reclassification, the District had requested an excess amount of purchased service expenditures than what is shown on the District’s underlying accounting records. Statement of Effect: The grant project code for purchased services had more reimbursement requested for it in the current year than expenditures coded to the project code in the District’s accounting records. The District requested a surplus of reimbursements for related expenditures. This could result in the District being required by the granting agency to return their reimbursements and/or other adverse conditions with the granting agency.Questioned Costs: The District reported $9,430 more in purchased service expenditures than the underlying accounting records support. No other questioned costs noted. Perspective Information: Since there was a one-time adjustment to move purchased services from ESSER III to meet the requirements of another program this appears to be an isolated occurrence. Identification of Repeat Findings: Not a repeat finding. Recommendation: We recommend that the District implement a process for tracking expenditures related to the grants in a clear and concise manner that is comprehensible to others to ensure expenditures used for reimbursement requests exist and are supported by proper supporting documentation. Proper supporting documentation should be maintained and easily accessible for evidence of the expenditures. We also recommend that another party review all grant reporting and reconciliations before submission to ensure accuracy. Views of Responsible Officials: Each month when reporting our financials, all federal grant accounts will be separated and will be reviewed for accuracy and to ensure proper project codes are correct. Also, expenditures for 1% professional development will be reviewed for accuracy. All payment requests for federal fund grants will be approved prior to submission by the Superintendent. See Corrective Action Plan.
Federal Agency: U.S. Department of Education Passthrough Entity: Missouri Department of Elementary and Secondary Education Assistance Listing Number and Federal Program: 84.425U American Rescue Plan Elementary and Secondary School Emergency Relief Compliance Requirement: B. Allowable Costs Criteria: The District is responsible for the efficient and effective administration of federal awards though the application of sound management practices. 2 CFR Section 200.302 discusses the importance of a financial management system and records that identify adequately the source and applications of funds for federally funded activities. There should be effective control over, and accountability for all funds. Statement of Condition: During our testing of ESSER III grants, it was noted that the District requested more for purchased services than was shown as expended in the District’s accounting records. Statement of Cause: The District does not have the appropriate internal controls in place to review expenditures claimed under each grant within the program. As a result, the District was required to reclassify certain purchased service expenditures from one project code to another to meet a state requirement. However, these expenditures had already been reported on the ESSER III expenditure report. Therefore, due to the reclassification, the District had requested an excess amount of purchased service expenditures than what is shown on the District’s underlying accounting records. Statement of Effect: The grant project code for purchased services had more reimbursement requested for it in the current year than expenditures coded to the project code in the District’s accounting records. The District requested a surplus of reimbursements for related expenditures. This could result in the District being required by the granting agency to return their reimbursements and/or other adverse conditions with the granting agency.Questioned Costs: The District reported $9,430 more in purchased service expenditures than the underlying accounting records support. No other questioned costs noted. Perspective Information: Since there was a one-time adjustment to move purchased services from ESSER III to meet the requirements of another program this appears to be an isolated occurrence. Identification of Repeat Findings: Not a repeat finding. Recommendation: We recommend that the District implement a process for tracking expenditures related to the grants in a clear and concise manner that is comprehensible to others to ensure expenditures used for reimbursement requests exist and are supported by proper supporting documentation. Proper supporting documentation should be maintained and easily accessible for evidence of the expenditures. We also recommend that another party review all grant reporting and reconciliations before submission to ensure accuracy. Views of Responsible Officials: Each month when reporting our financials, all federal grant accounts will be separated and will be reviewed for accuracy and to ensure proper project codes are correct. Also, expenditures for 1% professional development will be reviewed for accuracy. All payment requests for federal fund grants will be approved prior to submission by the Superintendent. See Corrective Action Plan.
Federal Program: U.S. Department of Commerce-ALN 11.307, Urban Agriculture Mapping and CEDS Integration Criteria: 2 CFR 200.302 requires that non-federal entities must provide for the accurate, current, and complete disclosure of financial results for each Federal award or program in accordance with the reporting requirements set forth in 2 CFR section 200.328 Condition/Context: During our testing, we reviewed the semi-annual and final federal financial report and noted that the semi-annual federal financial report due on October 31, 2023, was submitted on November 13, 2023. Cause: The Board did not have adequate policies and procedures in place to allow all federal financial reporting to occur timely. Effect: The Board is not in compliance with reporting requirements. Questioned Cost: None Recommendation: The Board should enhance it policies and procedures to ensure that all future reports are submitted timely. Views of responsible officials: Management agrees with the finding and the Auditors’ recommendation. See Corrective Action Plan at the end of the report.
Assistance Listing Number, Federal Agency, and Program Name - 84.007, 84.033, 84.063, 84.268; U.S. Department of Education; Federal Supplemental Educational Opportunity Grants, Federal Work-Study Program, Federal Pell Grant Program, Federal Direct Student Loans Federal Award Identification Number and Year - P007A236053, P033A236053, P063P232857, P268K242857; 2023-2024 Pass-through Entity - N/A Finding Type - Significant deficiency Repeat Finding - No Criteria - In accordance with 2 CFR 200.302(b)(6), the College must establish written procedures to implement the requirements of 200.305 (federal payment), which outlines cash management requirements. Condition - As the College does not have a written cash management policy related to federal payments/awards, there was a lack of internal controls in place to ensure that this compliance requirement is met. Questioned Costs - N/A Identification of How Questioned Costs Were Computed - N/A Context - The College does not have a written cash management policy related to federal payments/awards. Cause and Effect - As there is no control established to ensure this written policy is in place, the College is not in compliance with 2 CFR 200.302(b)(6). Recommendation - We recommend that the College establish a written cash management policy related to federal payments/awards and that controls are implemented to ensure that it is updated as necessary. Views of Responsible Officials and Planned Corrective Actions - In accordance with 2 CFR 200.302(b)(6), the College will establish a written cash management policy, including written procedures related to federal payments/awards, in order to implement the requirements of 200.305.
Assistance Listing Number, Federal Agency, and Program Name - 84.007, 84.033, 84.063, 84.268; U.S. Department of Education; Federal Supplemental Educational Opportunity Grants, Federal Work-Study Program, Federal Pell Grant Program, Federal Direct Student Loans Federal Award Identification Number and Year - P007A236053, P033A236053, P063P232857, P268K242857; 2023-2024 Pass-through Entity - N/A Finding Type - Significant deficiency Repeat Finding - No Criteria - In accordance with 2 CFR 200.302(b)(6), the College must establish written procedures to implement the requirements of 200.305 (federal payment), which outlines cash management requirements. Condition - As the College does not have a written cash management policy related to federal payments/awards, there was a lack of internal controls in place to ensure that this compliance requirement is met. Questioned Costs - N/A Identification of How Questioned Costs Were Computed - N/A Context - The College does not have a written cash management policy related to federal payments/awards. Cause and Effect - As there is no control established to ensure this written policy is in place, the College is not in compliance with 2 CFR 200.302(b)(6). Recommendation - We recommend that the College establish a written cash management policy related to federal payments/awards and that controls are implemented to ensure that it is updated as necessary. Views of Responsible Officials and Planned Corrective Actions - In accordance with 2 CFR 200.302(b)(6), the College will establish a written cash management policy, including written procedures related to federal payments/awards, in order to implement the requirements of 200.305.
Assistance Listing Number, Federal Agency, and Program Name - 84.007, 84.033, 84.063, 84.268; U.S. Department of Education; Federal Supplemental Educational Opportunity Grants, Federal Work-Study Program, Federal Pell Grant Program, Federal Direct Student Loans Federal Award Identification Number and Year - P007A236053, P033A236053, P063P232857, P268K242857; 2023-2024 Pass-through Entity - N/A Finding Type - Significant deficiency Repeat Finding - No Criteria - In accordance with 2 CFR 200.302(b)(6), the College must establish written procedures to implement the requirements of 200.305 (federal payment), which outlines cash management requirements. Condition - As the College does not have a written cash management policy related to federal payments/awards, there was a lack of internal controls in place to ensure that this compliance requirement is met. Questioned Costs - N/A Identification of How Questioned Costs Were Computed - N/A Context - The College does not have a written cash management policy related to federal payments/awards. Cause and Effect - As there is no control established to ensure this written policy is in place, the College is not in compliance with 2 CFR 200.302(b)(6). Recommendation - We recommend that the College establish a written cash management policy related to federal payments/awards and that controls are implemented to ensure that it is updated as necessary. Views of Responsible Officials and Planned Corrective Actions - In accordance with 2 CFR 200.302(b)(6), the College will establish a written cash management policy, including written procedures related to federal payments/awards, in order to implement the requirements of 200.305.
Assistance Listing Number, Federal Agency, and Program Name - 84.007, 84.033, 84.063, 84.268; U.S. Department of Education; Federal Supplemental Educational Opportunity Grants, Federal Work-Study Program, Federal Pell Grant Program, Federal Direct Student Loans Federal Award Identification Number and Year - P007A236053, P033A236053, P063P232857, P268K242857; 2023-2024 Pass-through Entity - N/A Finding Type - Significant deficiency Repeat Finding - No Criteria - In accordance with 2 CFR 200.302(b)(6), the College must establish written procedures to implement the requirements of 200.305 (federal payment), which outlines cash management requirements. Condition - As the College does not have a written cash management policy related to federal payments/awards, there was a lack of internal controls in place to ensure that this compliance requirement is met. Questioned Costs - N/A Identification of How Questioned Costs Were Computed - N/A Context - The College does not have a written cash management policy related to federal payments/awards. Cause and Effect - As there is no control established to ensure this written policy is in place, the College is not in compliance with 2 CFR 200.302(b)(6). Recommendation - We recommend that the College establish a written cash management policy related to federal payments/awards and that controls are implemented to ensure that it is updated as necessary. Views of Responsible Officials and Planned Corrective Actions - In accordance with 2 CFR 200.302(b)(6), the College will establish a written cash management policy, including written procedures related to federal payments/awards, in order to implement the requirements of 200.305.
FINDING 2024-003 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, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D210013, S425U200013 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. 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. FINDING 2024-003 (Continued) Questioned Costs: There were no questioned costs identified. Context: The School Corporation was required to submit two Annual Data Reports to the Indiana Department of Education (IDOE) during the audit period to meet federal reporting requirements for ESSER grant awards. We noted that the ESSER II and ESSER III amounts reported on the Year 3 report ($347,591 and $337,851 respectively) did not agree to the underlying expenditure records ($135,355 and $159,811 respectively). Additionally, we noted that the ESSER II amount reported on the Year 4 report ($233,093) did not agree to the underlying expenditure records ($267,310) of the School Corporation. Identification as a repeat finding: This is a repeat finding from the immediately prior audit. The prior finding number was 2022-003. 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 2024-003 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, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D210013, S425U200013 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. 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. FINDING 2024-003 (Continued) Questioned Costs: There were no questioned costs identified. Context: The School Corporation was required to submit two Annual Data Reports to the Indiana Department of Education (IDOE) during the audit period to meet federal reporting requirements for ESSER grant awards. We noted that the ESSER II and ESSER III amounts reported on the Year 3 report ($347,591 and $337,851 respectively) did not agree to the underlying expenditure records ($135,355 and $159,811 respectively). Additionally, we noted that the ESSER II amount reported on the Year 4 report ($233,093) did not agree to the underlying expenditure records ($267,310) of the School Corporation. Identification as a repeat finding: This is a repeat finding from the immediately prior audit. The prior finding number was 2022-003. 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 2024-002 Information on the federal program: Subject: COVID-19 – Education Stabilization Fund – Reporting Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 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 Finding: Significant Deficiency 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 District's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. 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. Internal controls were not adequate to detect and prevent errors in annual data submitted to the Indiana Department of Education. Questioned Costs: There were no questioned costs identified. FINDING 2024-002 (Continued) Context: The School Corporation had not designed nor implemented a system of internal control to ensure that the annual Elementary and Secondary School Emergency Relief (ESSER) annual Data Collection reports (Reports) were complete and accurately submitted. The reports were prepared and submitted in JotForm, the online application used by the Indiana Department of Education to collect information, without an oversight or secondary review process in place to prevent or detect and correct errors. During the testing of the annual data reports, variances were noted in the amounts expended reported on the Year 3 and Year 4 annual data reports for the ESSER II and ESSER III grant awards when compared to underlying disbursement detail for the grant funds. The amounts reported as expended in the Year 3 reports, which covers the period of July 1, 2021 through June 30, 2022, included amounts not expended until the following fiscal year. The amounts reported as expended in the Year 4 report, which covers the period of July 1, 2022 through June 30, 2023, for ESSER III totaled $745,052 compared to underlying disbursement detail of $648,383 for the same period. Identification as a repeat finding, if applicable: No. Recommendation: We recommend someone other than the preparer of the report perform a documented, secondary review of the report information 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 2024-002 Information on the federal program: Subject: COVID-19 – Education Stabilization Fund – Reporting Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 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 Finding: Significant Deficiency 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 District's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. 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. Internal controls were not adequate to detect and prevent errors in annual data submitted to the Indiana Department of Education. Questioned Costs: There were no questioned costs identified. FINDING 2024-002 (Continued) Context: The School Corporation had not designed nor implemented a system of internal control to ensure that the annual Elementary and Secondary School Emergency Relief (ESSER) annual Data Collection reports (Reports) were complete and accurately submitted. The reports were prepared and submitted in JotForm, the online application used by the Indiana Department of Education to collect information, without an oversight or secondary review process in place to prevent or detect and correct errors. During the testing of the annual data reports, variances were noted in the amounts expended reported on the Year 3 and Year 4 annual data reports for the ESSER II and ESSER III grant awards when compared to underlying disbursement detail for the grant funds. The amounts reported as expended in the Year 3 reports, which covers the period of July 1, 2021 through June 30, 2022, included amounts not expended until the following fiscal year. The amounts reported as expended in the Year 4 report, which covers the period of July 1, 2022 through June 30, 2023, for ESSER III totaled $745,052 compared to underlying disbursement detail of $648,383 for the same period. Identification as a repeat finding, if applicable: No. Recommendation: We recommend someone other than the preparer of the report perform a documented, secondary review of the report information 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.
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, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D210013, S425U200013 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. 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 two Annual Data Reports to the Indiana Department of Education (IDOE) during the audit period to meet federal reporting requirements for ESSER grant awards. We noted that the ESSER II and ESSER III amounts reported on the Year 3 report ($397,392 and $294,138, respectively) did not agree to the underlying expenditure records ($498,259 and $1,509,413, respectively, for the period of July 1, 2021 through June 30, 2022). Additionally, we noted that the ESSER II and ESSER III amounts reported on the Year 4 report ($400,501 and $294,129, respectively) did not agree to the underlying expenditure records ($412,324 and $287,065, respectively, for the period of July 1, 2022 through June 30, 2023). We noted that the 602 number of Full-time equivalent (FTE) positions on September 30, 2022 on the first report did not agree to the underlying records supporting number of 1,233 Full-time equivalent (FTE) positions on September 30, 2023. 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.
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, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D210013, S425U200013 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. 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 two Annual Data Reports to the Indiana Department of Education (IDOE) during the audit period to meet federal reporting requirements for ESSER grant awards. We noted that the ESSER II and ESSER III amounts reported on the Year 3 report ($397,392 and $294,138, respectively) did not agree to the underlying expenditure records ($498,259 and $1,509,413, respectively, for the period of July 1, 2021 through June 30, 2022). Additionally, we noted that the ESSER II and ESSER III amounts reported on the Year 4 report ($400,501 and $294,129, respectively) did not agree to the underlying expenditure records ($412,324 and $287,065, respectively, for the period of July 1, 2022 through June 30, 2023). We noted that the 602 number of Full-time equivalent (FTE) positions on September 30, 2022 on the first report did not agree to the underlying records supporting number of 1,233 Full-time equivalent (FTE) positions on September 30, 2023. 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.
2024-002 Inaccurate Filing of Federal Financial Reports Federal Department: Department of Justice, Office on Violence Against Women Assistance Listing #: 16.526 Compliance and Internal Controls Significant Deficiency Category of Finding – Reporting Criteria – § 200.302 Financial management of Uniform Guidance requires that Esperanza develop and maintain a financial management system to ensure accurate, current, and complete disclosure of the financial results of each Federal award as required by the grant agreements. Esperanza's grants require quarterly FFR (financial) reports be submitted. Condition – The September 30, 2023 and December 31, 2023 FFR reports for Award # 2016-TA-AX-K040 reported inaccurate federal expenditures. Total federal expenditures reported were $783,183 and $809,897 for periods ended September 30, 2023 and December 31, 2023, whereas actual expenditures in the financial management system for the periods ended were $756,435 and $760,887, respectively. Cause – The organization went through turnover of key staff during the fiscal year. In addition, review of the financial reports were performed subsequent to the submission. Effect – Inaccurate financial reporting may result in Esperanza’s status to be delinquent and not be able to draw down funds on the award or future awards from the awarding agency. Recommendation – We recommend that management implement a structured and two-step review process where a knowledgeable and experienced individual other than the preparer reviews the report prior to submission. Management’s Response and Corrective Action – Esperanza has assigned the contract accountant to be responsible for preparing these reports and implemented review processes to ensure these reports are accurate. Responsible party for corrective action – Vivian Huelgo, President and CEO Repeat finding – No
2024-002 Inaccurate Filing of Federal Financial Reports Federal Department: Department of Justice, Office on Violence Against Women Assistance Listing #: 16.526 Compliance and Internal Controls Significant Deficiency Category of Finding – Reporting Criteria – § 200.302 Financial management of Uniform Guidance requires that Esperanza develop and maintain a financial management system to ensure accurate, current, and complete disclosure of the financial results of each Federal award as required by the grant agreements. Esperanza's grants require quarterly FFR (financial) reports be submitted. Condition – The September 30, 2023 and December 31, 2023 FFR reports for Award # 2016-TA-AX-K040 reported inaccurate federal expenditures. Total federal expenditures reported were $783,183 and $809,897 for periods ended September 30, 2023 and December 31, 2023, whereas actual expenditures in the financial management system for the periods ended were $756,435 and $760,887, respectively. Cause – The organization went through turnover of key staff during the fiscal year. In addition, review of the financial reports were performed subsequent to the submission. Effect – Inaccurate financial reporting may result in Esperanza’s status to be delinquent and not be able to draw down funds on the award or future awards from the awarding agency. Recommendation – We recommend that management implement a structured and two-step review process where a knowledgeable and experienced individual other than the preparer reviews the report prior to submission. Management’s Response and Corrective Action – Esperanza has assigned the contract accountant to be responsible for preparing these reports and implemented review processes to ensure these reports are accurate. Responsible party for corrective action – Vivian Huelgo, President and CEO Repeat finding – No
2024-002 Inaccurate Filing of Federal Financial Reports Federal Department: Department of Justice, Office on Violence Against Women Assistance Listing #: 16.526 Compliance and Internal Controls Significant Deficiency Category of Finding – Reporting Criteria – § 200.302 Financial management of Uniform Guidance requires that Esperanza develop and maintain a financial management system to ensure accurate, current, and complete disclosure of the financial results of each Federal award as required by the grant agreements. Esperanza's grants require quarterly FFR (financial) reports be submitted. Condition – The September 30, 2023 and December 31, 2023 FFR reports for Award # 2016-TA-AX-K040 reported inaccurate federal expenditures. Total federal expenditures reported were $783,183 and $809,897 for periods ended September 30, 2023 and December 31, 2023, whereas actual expenditures in the financial management system for the periods ended were $756,435 and $760,887, respectively. Cause – The organization went through turnover of key staff during the fiscal year. In addition, review of the financial reports were performed subsequent to the submission. Effect – Inaccurate financial reporting may result in Esperanza’s status to be delinquent and not be able to draw down funds on the award or future awards from the awarding agency. Recommendation – We recommend that management implement a structured and two-step review process where a knowledgeable and experienced individual other than the preparer reviews the report prior to submission. Management’s Response and Corrective Action – Esperanza has assigned the contract accountant to be responsible for preparing these reports and implemented review processes to ensure these reports are accurate. Responsible party for corrective action – Vivian Huelgo, President and CEO Repeat finding – No
2024-002 Inaccurate Filing of Federal Financial Reports Federal Department: Department of Justice, Office on Violence Against Women Assistance Listing #: 16.526 Compliance and Internal Controls Significant Deficiency Category of Finding – Reporting Criteria – § 200.302 Financial management of Uniform Guidance requires that Esperanza develop and maintain a financial management system to ensure accurate, current, and complete disclosure of the financial results of each Federal award as required by the grant agreements. Esperanza's grants require quarterly FFR (financial) reports be submitted. Condition – The September 30, 2023 and December 31, 2023 FFR reports for Award # 2016-TA-AX-K040 reported inaccurate federal expenditures. Total federal expenditures reported were $783,183 and $809,897 for periods ended September 30, 2023 and December 31, 2023, whereas actual expenditures in the financial management system for the periods ended were $756,435 and $760,887, respectively. Cause – The organization went through turnover of key staff during the fiscal year. In addition, review of the financial reports were performed subsequent to the submission. Effect – Inaccurate financial reporting may result in Esperanza’s status to be delinquent and not be able to draw down funds on the award or future awards from the awarding agency. Recommendation – We recommend that management implement a structured and two-step review process where a knowledgeable and experienced individual other than the preparer reviews the report prior to submission. Management’s Response and Corrective Action – Esperanza has assigned the contract accountant to be responsible for preparing these reports and implemented review processes to ensure these reports are accurate. Responsible party for corrective action – Vivian Huelgo, President and CEO Repeat finding – No
2024-002 Inaccurate Filing of Federal Financial Reports Federal Department: Department of Justice, Office on Violence Against Women Assistance Listing #: 16.526 Compliance and Internal Controls Significant Deficiency Category of Finding – Reporting Criteria – § 200.302 Financial management of Uniform Guidance requires that Esperanza develop and maintain a financial management system to ensure accurate, current, and complete disclosure of the financial results of each Federal award as required by the grant agreements. Esperanza's grants require quarterly FFR (financial) reports be submitted. Condition – The September 30, 2023 and December 31, 2023 FFR reports for Award # 2016-TA-AX-K040 reported inaccurate federal expenditures. Total federal expenditures reported were $783,183 and $809,897 for periods ended September 30, 2023 and December 31, 2023, whereas actual expenditures in the financial management system for the periods ended were $756,435 and $760,887, respectively. Cause – The organization went through turnover of key staff during the fiscal year. In addition, review of the financial reports were performed subsequent to the submission. Effect – Inaccurate financial reporting may result in Esperanza’s status to be delinquent and not be able to draw down funds on the award or future awards from the awarding agency. Recommendation – We recommend that management implement a structured and two-step review process where a knowledgeable and experienced individual other than the preparer reviews the report prior to submission. Management’s Response and Corrective Action – Esperanza has assigned the contract accountant to be responsible for preparing these reports and implemented review processes to ensure these reports are accurate. Responsible party for corrective action – Vivian Huelgo, President and CEO Repeat finding – No
2024-002 Inaccurate Filing of Federal Financial Reports Federal Department: Department of Justice, Office on Violence Against Women Assistance Listing #: 16.526 Compliance and Internal Controls Significant Deficiency Category of Finding – Reporting Criteria – § 200.302 Financial management of Uniform Guidance requires that Esperanza develop and maintain a financial management system to ensure accurate, current, and complete disclosure of the financial results of each Federal award as required by the grant agreements. Esperanza's grants require quarterly FFR (financial) reports be submitted. Condition – The September 30, 2023 and December 31, 2023 FFR reports for Award # 2016-TA-AX-K040 reported inaccurate federal expenditures. Total federal expenditures reported were $783,183 and $809,897 for periods ended September 30, 2023 and December 31, 2023, whereas actual expenditures in the financial management system for the periods ended were $756,435 and $760,887, respectively. Cause – The organization went through turnover of key staff during the fiscal year. In addition, review of the financial reports were performed subsequent to the submission. Effect – Inaccurate financial reporting may result in Esperanza’s status to be delinquent and not be able to draw down funds on the award or future awards from the awarding agency. Recommendation – We recommend that management implement a structured and two-step review process where a knowledgeable and experienced individual other than the preparer reviews the report prior to submission. Management’s Response and Corrective Action – Esperanza has assigned the contract accountant to be responsible for preparing these reports and implemented review processes to ensure these reports are accurate. Responsible party for corrective action – Vivian Huelgo, President and CEO Repeat finding – No
2024-002 Inaccurate Filing of Federal Financial Reports Federal Department: Department of Justice, Office on Violence Against Women Assistance Listing #: 16.526 Compliance and Internal Controls Significant Deficiency Category of Finding – Reporting Criteria – § 200.302 Financial management of Uniform Guidance requires that Esperanza develop and maintain a financial management system to ensure accurate, current, and complete disclosure of the financial results of each Federal award as required by the grant agreements. Esperanza's grants require quarterly FFR (financial) reports be submitted. Condition – The September 30, 2023 and December 31, 2023 FFR reports for Award # 2016-TA-AX-K040 reported inaccurate federal expenditures. Total federal expenditures reported were $783,183 and $809,897 for periods ended September 30, 2023 and December 31, 2023, whereas actual expenditures in the financial management system for the periods ended were $756,435 and $760,887, respectively. Cause – The organization went through turnover of key staff during the fiscal year. In addition, review of the financial reports were performed subsequent to the submission. Effect – Inaccurate financial reporting may result in Esperanza’s status to be delinquent and not be able to draw down funds on the award or future awards from the awarding agency. Recommendation – We recommend that management implement a structured and two-step review process where a knowledgeable and experienced individual other than the preparer reviews the report prior to submission. Management’s Response and Corrective Action – Esperanza has assigned the contract accountant to be responsible for preparing these reports and implemented review processes to ensure these reports are accurate. Responsible party for corrective action – Vivian Huelgo, President and CEO Repeat finding – No
2024-002 Inaccurate Filing of Federal Financial Reports Federal Department: Department of Justice, Office on Violence Against Women Assistance Listing #: 16.526 Compliance and Internal Controls Significant Deficiency Category of Finding – Reporting Criteria – § 200.302 Financial management of Uniform Guidance requires that Esperanza develop and maintain a financial management system to ensure accurate, current, and complete disclosure of the financial results of each Federal award as required by the grant agreements. Esperanza's grants require quarterly FFR (financial) reports be submitted. Condition – The September 30, 2023 and December 31, 2023 FFR reports for Award # 2016-TA-AX-K040 reported inaccurate federal expenditures. Total federal expenditures reported were $783,183 and $809,897 for periods ended September 30, 2023 and December 31, 2023, whereas actual expenditures in the financial management system for the periods ended were $756,435 and $760,887, respectively. Cause – The organization went through turnover of key staff during the fiscal year. In addition, review of the financial reports were performed subsequent to the submission. Effect – Inaccurate financial reporting may result in Esperanza’s status to be delinquent and not be able to draw down funds on the award or future awards from the awarding agency. Recommendation – We recommend that management implement a structured and two-step review process where a knowledgeable and experienced individual other than the preparer reviews the report prior to submission. Management’s Response and Corrective Action – Esperanza has assigned the contract accountant to be responsible for preparing these reports and implemented review processes to ensure these reports are accurate. Responsible party for corrective action – Vivian Huelgo, President and CEO Repeat finding – No
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, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D210013, S425U210013 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. 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 two Annual Data Reports to the Indiana Department of Education (IDOE) during the audit period to meet federal reporting requirements for ESSER grant awards. We noted that the ESSER II amount reported on the Year 3 report ($572,289) did not agree to the underlying expenditure records ($558,956) for the period of July 1, 2021 through June 30, 2022. Additionally, we noted that the ESSER I, ESSER II, and ESSER III amounts reported on the Year 4 report ($105,506, $510,158, and $1,156,254, respectively) did not agree to the underlying expenditure records ($138,662, $316,236, and $1,158,054, respectively) for the period of July 1, 2022 through June 30, 2023. We also noted there was no documented, secondary review of the information in the annual data reports by someone other than the preparer. Identification as a repeat finding: This is a repeat finding from the immediately prior audit. The prior finding number was 2022-008. 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.
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, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D210013, S425U210013 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. 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 two Annual Data Reports to the Indiana Department of Education (IDOE) during the audit period to meet federal reporting requirements for ESSER grant awards. We noted that the ESSER II amount reported on the Year 3 report ($572,289) did not agree to the underlying expenditure records ($558,956) for the period of July 1, 2021 through June 30, 2022. Additionally, we noted that the ESSER I, ESSER II, and ESSER III amounts reported on the Year 4 report ($105,506, $510,158, and $1,156,254, respectively) did not agree to the underlying expenditure records ($138,662, $316,236, and $1,158,054, respectively) for the period of July 1, 2022 through June 30, 2023. We also noted there was no documented, secondary review of the information in the annual data reports by someone other than the preparer. Identification as a repeat finding: This is a repeat finding from the immediately prior audit. The prior finding number was 2022-008. 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.
Assistance Listing Number(s): 93.558 Name of Federal Program or Cluster: Temporary Assistance for Needy Families (TANF) Name of Federal Agency: Department of Health and Human Services Name of Pass-through Entity: Boys & Girls Clubs of Fox Valley Award Period: July 1, 2023 through June 30, 2024 Criteria or Specific Requirement: 2 CFR section 200.302(b)(2) requires the financial management system of a non-federal entity to provide for accurate, current, and complete disclosure of the financial results of each federal award or program. Condition: Expenditures in total agree to the underlying accounting records, however, general ledger line items and award budget line items do not reconcile for contracted/consulting services, equipment, building costs, other, and indirect costs. Cause: Reports were reconciled only in total to the general ledger and award budgets do not utilize general ledger accounts when developing. Effect or Potential Effect: Costs may be disallowed if not approved in the budget or over budget without prior approval. Repeat Finding: Repeat of finding 2023-007. Recommendation: Reconciliation of not only the total federal expenditures reported to the general ledger, but by budget line item and general ledger accounts. A review process of the reconciliation should be designed and implemented to ensure that both expenditures in total and by budget line item are reported accurately and are supported by the accounting records. Award budgets should be prepared and approved with the actual costs expected per the general ledger accounts to be incurred. Views of Responsible Officials: Boys and Girls Club of Dane County, Inc. agrees with the finding and is implementing a grant budget process.
Assistance Listing Number(s): 93.558 Name of Federal Program or Cluster: Temporary Assistance for Needy Families (TANF) Name of Federal Agency: Department of Health and Human Services Name of Pass-through Entity: Boys & Girls Clubs of Fox Valley Award Period: July 1, 2023 through June 30, 2024 Criteria or Specific Requirement: 2 CFR section 200.302(b)(2) requires the financial management system of a non-federal entity to provide for accurate, current, and complete disclosure of the financial results of each federal award or program. Condition: Expenditures in total agree to the underlying accounting records, however, general ledger line items and award budget line items do not reconcile for contracted/consulting services, equipment, building costs, other, and indirect costs. Cause: Reports were reconciled only in total to the general ledger and award budgets do not utilize general ledger accounts when developing. Effect or Potential Effect: Costs may be disallowed if not approved in the budget or over budget without prior approval. Repeat Finding: Repeat of finding 2023-007. Recommendation: Reconciliation of not only the total federal expenditures reported to the general ledger, but by budget line item and general ledger accounts. A review process of the reconciliation should be designed and implemented to ensure that both expenditures in total and by budget line item are reported accurately and are supported by the accounting records. Award budgets should be prepared and approved with the actual costs expected per the general ledger accounts to be incurred. Views of Responsible Officials: Boys and Girls Club of Dane County, Inc. agrees with the finding and is implementing a grant budget process.
2024-003 – Reimbursement Requests (Significant Deficiency in Internal Controls over Compliance) Federal Program Information Federal Award Title and ALN: Federal Transit Cluster, 20.507, 20.526 Federal Awarding Agency: Department of Transportation Federal Award ID Number: N/A Federal Award Year: 2024 Federal Award Title and ALN: Airport Improvement Program, 20.106 Federal Awarding Agency: Department of Transportation, Federal Aviation Administration Federal Award ID Number: SAF-SWG-3-35-0037-051-2020, SAF-SWG-3-35-0037-057-2021 Federal Award Year: 2024 Condition: The City submitted reimbursements for grants in an untimely fashion for multiple months at a time in the Federal Transit Cluster and only at year-end in the Airport Improvement Program. Criteria: Per 2 CFR 200.303(a), the non-federal entity must 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). Per Title 2 US Code of Federal Regulations Part 200.302b, the non-federal entity must provide for effective control over, and accountability for, all funds, property, and other assets. The non-federal entity must adequately safeguard all assets and assure that they are used solely for authorized purposes. Cause: The City does not have sufficient controls in place to review and approve requests to submit as needed. Questioned Cost: None. Effect: The City’s financial position and cash balances were adversely affected due to the delay in requesting and receiving reimbursement for funds already disbursed. Significant time passing between disbursement of funds and preparation of reimbursement requests may increase the chance of errors.
2024-003 – Reimbursement Requests (Significant Deficiency in Internal Controls over Compliance) Federal Program Information Federal Award Title and ALN: Federal Transit Cluster, 20.507, 20.526 Federal Awarding Agency: Department of Transportation Federal Award ID Number: N/A Federal Award Year: 2024 Federal Award Title and ALN: Airport Improvement Program, 20.106 Federal Awarding Agency: Department of Transportation, Federal Aviation Administration Federal Award ID Number: SAF-SWG-3-35-0037-051-2020, SAF-SWG-3-35-0037-057-2021 Federal Award Year: 2024 Condition: The City submitted reimbursements for grants in an untimely fashion for multiple months at a time in the Federal Transit Cluster and only at year-end in the Airport Improvement Program. Criteria: Per 2 CFR 200.303(a), the non-federal entity must 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). Per Title 2 US Code of Federal Regulations Part 200.302b, the non-federal entity must provide for effective control over, and accountability for, all funds, property, and other assets. The non-federal entity must adequately safeguard all assets and assure that they are used solely for authorized purposes. Cause: The City does not have sufficient controls in place to review and approve requests to submit as needed. Questioned Cost: None. Effect: The City’s financial position and cash balances were adversely affected due to the delay in requesting and receiving reimbursement for funds already disbursed. Significant time passing between disbursement of funds and preparation of reimbursement requests may increase the chance of errors.
2024-003 – Reimbursement Requests (Significant Deficiency in Internal Controls over Compliance) Federal Program Information Federal Award Title and ALN: Federal Transit Cluster, 20.507, 20.526 Federal Awarding Agency: Department of Transportation Federal Award ID Number: N/A Federal Award Year: 2024 Federal Award Title and ALN: Airport Improvement Program, 20.106 Federal Awarding Agency: Department of Transportation, Federal Aviation Administration Federal Award ID Number: SAF-SWG-3-35-0037-051-2020, SAF-SWG-3-35-0037-057-2021 Federal Award Year: 2024 Condition: The City submitted reimbursements for grants in an untimely fashion for multiple months at a time in the Federal Transit Cluster and only at year-end in the Airport Improvement Program. Criteria: Per 2 CFR 200.303(a), the non-federal entity must 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). Per Title 2 US Code of Federal Regulations Part 200.302b, the non-federal entity must provide for effective control over, and accountability for, all funds, property, and other assets. The non-federal entity must adequately safeguard all assets and assure that they are used solely for authorized purposes. Cause: The City does not have sufficient controls in place to review and approve requests to submit as needed. Questioned Cost: None. Effect: The City’s financial position and cash balances were adversely affected due to the delay in requesting and receiving reimbursement for funds already disbursed. Significant time passing between disbursement of funds and preparation of reimbursement requests may increase the chance of errors.
2024-003 – Reimbursement Requests (Significant Deficiency in Internal Controls over Compliance) Federal Program Information Federal Award Title and ALN: Federal Transit Cluster, 20.507, 20.526 Federal Awarding Agency: Department of Transportation Federal Award ID Number: N/A Federal Award Year: 2024 Federal Award Title and ALN: Airport Improvement Program, 20.106 Federal Awarding Agency: Department of Transportation, Federal Aviation Administration Federal Award ID Number: SAF-SWG-3-35-0037-051-2020, SAF-SWG-3-35-0037-057-2021 Federal Award Year: 2024 Condition: The City submitted reimbursements for grants in an untimely fashion for multiple months at a time in the Federal Transit Cluster and only at year-end in the Airport Improvement Program. Criteria: Per 2 CFR 200.303(a), the non-federal entity must 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). Per Title 2 US Code of Federal Regulations Part 200.302b, the non-federal entity must provide for effective control over, and accountability for, all funds, property, and other assets. The non-federal entity must adequately safeguard all assets and assure that they are used solely for authorized purposes. Cause: The City does not have sufficient controls in place to review and approve requests to submit as needed. Questioned Cost: None. Effect: The City’s financial position and cash balances were adversely affected due to the delay in requesting and receiving reimbursement for funds already disbursed. Significant time passing between disbursement of funds and preparation of reimbursement requests may increase the chance of errors.
2024-003 – Reimbursement Requests (Significant Deficiency in Internal Controls over Compliance) Federal Program Information Federal Award Title and ALN: Federal Transit Cluster, 20.507, 20.526 Federal Awarding Agency: Department of Transportation Federal Award ID Number: N/A Federal Award Year: 2024 Federal Award Title and ALN: Airport Improvement Program, 20.106 Federal Awarding Agency: Department of Transportation, Federal Aviation Administration Federal Award ID Number: SAF-SWG-3-35-0037-051-2020, SAF-SWG-3-35-0037-057-2021 Federal Award Year: 2024 Condition: The City submitted reimbursements for grants in an untimely fashion for multiple months at a time in the Federal Transit Cluster and only at year-end in the Airport Improvement Program. Criteria: Per 2 CFR 200.303(a), the non-federal entity must 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). Per Title 2 US Code of Federal Regulations Part 200.302b, the non-federal entity must provide for effective control over, and accountability for, all funds, property, and other assets. The non-federal entity must adequately safeguard all assets and assure that they are used solely for authorized purposes. Cause: The City does not have sufficient controls in place to review and approve requests to submit as needed. Questioned Cost: None. Effect: The City’s financial position and cash balances were adversely affected due to the delay in requesting and receiving reimbursement for funds already disbursed. Significant time passing between disbursement of funds and preparation of reimbursement requests may increase the chance of errors.
#2024-001 – Significant Deficiency – Allowable Costs and Cost Principles HOME Funds ALN 14.239 Criteria The Office of Management and Budget issuance of the Code of Federal Regulations (CFR) specifically states uniform administrative requirements, cost principles, and audit requirements for federal awards. CFR 200.302(b)(3) states, “The recipient’s financial management system must maintain records that sufficiently identify the amount, source, and expenditure of Federal funds for Federal awards. These records must contain information necessary to identify Federal awards, authorizations, financial obligations, unobligated balances, as well as assets, expenditures, income, and interest. All records must be supported by source documentation.” Condition During the course of the audit, we noted there was no source documentation for seven expenses tested. Cause The Organization has made a reasonable effort to design proper controls, but has faced challenges in implementing them effectively, primarily with credit card charges and an increase in construction projects. Effect The potential effects of not having supporting documentation on file could include over or undercharging expenses to the federal grants. Questioned Costs $355.59 Perspective Information The finding noted related to seven (7) transactions examined when testing a sample of forty (40) non-payroll cash disbursements. The transactions are all credit card charges that the Organization did not maintain adequate documentation for. Recommendation We recommend having supporting documentation on file for all expenses charged to the Federal grants that shows approval of the expense from an appropriate member of management. View of Responsible Official Please see corresponding Corrective Action Plan.
FINDING 2024-003 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Number: 84.425U Federal Award Number and Year (or Other Identifying Number): S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Repeat Finding This is a repeat finding from the immediately prior audit report. The prior audit finding number was 2022-002. Condition and Context An effective internal control system was not designed or implemented at the School Corporation to ensure compliance with requirements related to the grant agreement and the Reporting compliance requirement. The School Corporation had not designed, nor implemented, a system of internal controls to ensure that the annual Elementary and Secondary School Emergency Relief (ESSER) Data Collection reports (Reports) were complete and accurately submitted. The Reports were prepared by one employee without a documented oversight, review, or approval process in place to prevent, or detect and correct, errors. Due to the lack of effective internal controls, two of the five Reports submitted during the audit period were not supported by the School Corporation's records. The following errors were noted: For the ESSER III, Year 2 report, which covered the period July 1, 2021 to June 30, 2022, total expenses reported were understated by $369,741. For the ESSER III, Year 3 report, which covered the period July 1, 2022 to June 30, 2023, total expenses reported for Property - Mandatory Subgrant Funds - Exclusive of Learning Loss Set-Aside were understated by $519,504. Total expenses reported for Supplies - Mandatory Subgrant Funds - Learning Loss Set-Aside were overstated by $11,260. The lack of internal controls was a systemic issue throughout the audit period. Noncompliance was isolated to the ESSER III, Year 2 and Year 3 reports. INDIANA STATE BOARD OF ACCOUNTS 18 JAC-CEN-DEL COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 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. . . ." 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. Due to turnover in the position responsible for review, reports were not reviewed to detect errors prior to submission. 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 III, Year 2 and Year 3 reports were not supported by the School Corporation's records. INDIANA STATE BOARD OF ACCOUNTS 19 JAC-CEN-DEL COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that the management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure that all reports are supported by the School Corporation's records. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-003 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Number: 84.425U Federal Award Number and Year (or Other Identifying Number): S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Repeat Finding This is a repeat finding from the immediately prior audit report. The prior audit finding number was 2022-002. Condition and Context An effective internal control system was not designed or implemented at the School Corporation to ensure compliance with requirements related to the grant agreement and the Reporting compliance requirement. The School Corporation had not designed, nor implemented, a system of internal controls to ensure that the annual Elementary and Secondary School Emergency Relief (ESSER) Data Collection reports (Reports) were complete and accurately submitted. The Reports were prepared by one employee without a documented oversight, review, or approval process in place to prevent, or detect and correct, errors. Due to the lack of effective internal controls, two of the five Reports submitted during the audit period were not supported by the School Corporation's records. The following errors were noted: For the ESSER III, Year 2 report, which covered the period July 1, 2021 to June 30, 2022, total expenses reported were understated by $369,741. For the ESSER III, Year 3 report, which covered the period July 1, 2022 to June 30, 2023, total expenses reported for Property - Mandatory Subgrant Funds - Exclusive of Learning Loss Set-Aside were understated by $519,504. Total expenses reported for Supplies - Mandatory Subgrant Funds - Learning Loss Set-Aside were overstated by $11,260. The lack of internal controls was a systemic issue throughout the audit period. Noncompliance was isolated to the ESSER III, Year 2 and Year 3 reports. INDIANA STATE BOARD OF ACCOUNTS 18 JAC-CEN-DEL COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 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. . . ." 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. Due to turnover in the position responsible for review, reports were not reviewed to detect errors prior to submission. 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 III, Year 2 and Year 3 reports were not supported by the School Corporation's records. INDIANA STATE BOARD OF ACCOUNTS 19 JAC-CEN-DEL COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that the management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure that all reports are supported by the School Corporation's records. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Financial Management System- (Material Weakness) Criteria: According to 2 CFR 200.302, the financial management system of each non-Federal entity must provide records that identify adequately the source and application of funds for federally-funded 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. Condition: Statement of financial position transactions were not allocated properly to programs/properties funded with federal funds. Cause: Due to a human error of individuals who were handling the accounting entries, some of transactions were not accurately allocated to the correct programs/properties. Effect: Improper allocation of transactions among various programs/properties could lead to comingling of funds from different projects. This could result in unallowable cost or in allowable cost charged simultaneously to two different programs/properties. Questioned Cost: None noted Recommendation: Establish an internal control procedures in place that provide for separate accountability for projects by allocating transactions properly and producing accurate financial reports for each federally funded programs/properties. Management's Views and Corrective Action Plan : Management's response is included in "Management's View and Corrective Action Plan" at the end of this report after the schedule of findings and questioned cost
Financial Management System- (Material Weakness) Criteria: According to 2 CFR 200.302, the financial management system of each non-Federal entity must provide records that identify adequately the source and application of funds for federally-funded 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. Condition: Statement of financial position transactions were not allocated properly to programs/properties funded with federal funds. Cause: Due to a human error of individuals who were handling the accounting entries, some of transactions were not accurately allocated to the correct programs/properties. Effect: Improper allocation of transactions among various programs/properties could lead to comingling of funds from different projects. This could result in unallowable cost or in allowable cost charged simultaneously to two different programs/properties. Questioned Cost: None noted Recommendation: Establish an internal control procedures in place that provide for separate accountability for projects by allocating transactions properly and producing accurate financial reports for each federally funded programs/properties. Management's Views and Corrective Action Plan : Management's response is included in "Management's View and Corrective Action Plan" at the end of this report after the schedule of findings and questioned cost
FINDING 2024-003 Cash Management – Drawdowns from Incorrect Contract FINDING TYPE Material Weakness in Internal Control over Compliance AGENCY U.S. Department of Health and Human Services ALN 93.224 / 93.527 Health Center Cluster CRITERIA In accordance with 2 CFR 200.302 (b)(3), entities receiving federal funds are responsible for maintaining records that adequately identify the source and application of funds for federallyfunded activities. CONDITION AND CONTEXT During the year ended June 30, 2024, $542,511 of funds related to contract H80CS00718 were incorrectly drawn from contract 21C8ECS44608C6. The error was only noted after the balance in contract 21C8ECS44608C6 was prematurely exhausted by the incorrect drawdowns. Upon noting the error, management informed the federal government of the error and submitted a request to correct the contract balances on June 11, 2024. CAUSE The staff tasked with initiating the draw-downs for this program entered the incorrect contract number into a funding request and the error was then subsequently repeated. EFFECT OR POTENTIAL EFFECT The organization may initiate drawdown requests that are not in compliance with the cash management requirements of the Uniform Guidance. REPEAT FINDING No. RECOMMENDATION We recommend that the organization implement a periodic reconciliation between its internal accounting records and the federal government’s data of each contract’s remaining available balance. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION See attached corrective action plan. Questioned Costs None.