Finding Reference Number: 2022-015 NH Department of Education Special Education Cluster (Assistance Listing #84.027 and #84.173) Federal Award Numbers: H027A180103, H027A190103, H027A210103 Federal Award Year: 2018, 2019, 2021 U.S. Department of Education Compliance Requirement: Period of Performance Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria LEAs and SEAs must obligate funds during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. This maximum period includes a 15-month period of initial availability plus a 12-month period for carryover. For example, funds from the fiscal year 2019 appropriation initially became available on July 1, 2019; and may be obligated by the grantee and subgrantee through September 30, 2021 (Section 421(b) of GEPA (20 USC 1225(b)); 34 CFR sections 76.703 through 76.710). Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 12 of 12 expenditures selected for testing awards that started during the state fiscal year, the Department had charged the expense to the new federal fiscal year grant, however, the date of service on the invoice was for a period prior to the start of that federal award. Furthermore, during our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 12 of 40 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the Department had charged the expense to the old federal fiscal year grant, however, the date of service on the invoice was for a period subsequent to the end of that federal award. Lastly, the Department had a breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking. Cause The cause of the condition found is due to how the Department charges costs to federal grants and the breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking. Effect The effect of the condition found is that the Department did not comply with the period of performance regulations. Questioned Costs $117,634 - the amount of expenditures charged to the Fiscal Year 2019 award that related to a date of service subsequent to the end of liquidation period for that award $5,811 - the amount of expenditures charged to the Fiscal Year 2021 award that related to a date of service prior to the start of that federal award $593 - the amount of expenditures charged to the Fiscal Year 2018 award that related to a date of service subsequent to the end of liquidation period for that award Recommendation We recommend that the Department implement internal control and policies and procedures to ensure costs are appropriately charged to federal awards based on the incurred date. View of Responsible Officials The Department does not concur. The Department notes extensions are in place related to COVID-19 and the Tydings Amendment through the Department of Education mitigating the condition noted. The Department will confer with the US DE to clarify the extensions in place and resolve any disparities identified within the finding. Anticipated Completion Date: Completed as of the date of this report Contact Person: Lindsey Labonville, Melissa White Rejoinder Based on the supporting documentation provided by the Department, it did not appear that the expenses identified within the condition found were charged to the correct period of performance during the liquidation period. Subsequently management adjusted the CAN the expenses related to which would correct the condition found.
Finding Reference Number: 2022-014 NH Department of Education Special Education Cluster (Assistance Listing #84.027 and #84.173) Federal Award Numbers: H027A210103, H173A210109, H027A180103, H173A180109 Federal Award Year: 2021, 2022 U.S. Department of Education Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria A pass-through entity must clearly identify to the subrecipient required award information and applicable requirements described in 2 CFR section 200.332(a); Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2022, the New Hampshire Department of Education (the Department) passed through $50,310,796 of federal funding to 174 subrecipients. As part of our testing related subrecipient monitoring, we noted that the Department communicates to subrecipients through the Grant Award Notifications (GANs). Per review of the GAN, we noted the following: A. For 44 of 44 subrecipients selected for testwork, the Department did not communicate the federal award identification number. B. For 15 of 44 subrecipients selected for testwork, the Department did not communicate the full award amount. Instead, the Department only communicated the subrecipients first installment amount entered into Grant Management System (GMS) which is a portion of the subrecipient?s total federal funding allocation. Cause The cause of the condition found was primarily due to breakdown of internal controls to ensure that the Grant Award Notification sent to subrecipients includes all required award data elements, including federal award identification number and full award amount. Effect The effect of the condition found is that the Department may not be in compliance with 2 CFR section 200.332(a)(1). Questioned Costs Not determinable. Recommendation We recommend that the Department review its existing policies and procedures over subrecipient monitoring award identification requirements and revise procedures and internal controls to ensure that information described in 2 CFR section 200.332(a)(1) is clearly identified to the subrecipient at the time of subaward (or subsequent subaward modification). View of Responsible Officials NHED concurs with the finding identified in section A. This was an oversight on the part of NHED, and a process has been implemented to ensure that when the GAN template is generated, there is a review by 2 separate staff members to ensure all required elements on the GAN are complete. NHED concurs with the finding identified in Section B. The previous Division Director of Learner Support, without understanding the unintended consequences, required that the IDEA allocations be uploaded in separate installments instead of including the full year award amount. This led to a GAN generation that included only the first installment. This procedure has since been corrected and NHED is now uploading the full year allocation amount in GMS, this will then generate a GAN that reflects the full year grant amount. If a reallocation does occur, there is a review by 2 separate staff members to ensure that the amount is verified and that a new GAN is manually generated to include that verified amount, and then the GAN is reissued to the recipient. Anticipated Completion Date: Already completed Contact Person: Lindsey Labonville
Finding Reference Number: 2022-015 NH Department of Education Special Education Cluster (Assistance Listing #84.027 and #84.173) Federal Award Numbers: H027A180103, H027A190103, H027A210103 Federal Award Year: 2018, 2019, 2021 U.S. Department of Education Compliance Requirement: Period of Performance Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria LEAs and SEAs must obligate funds during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. This maximum period includes a 15-month period of initial availability plus a 12-month period for carryover. For example, funds from the fiscal year 2019 appropriation initially became available on July 1, 2019; and may be obligated by the grantee and subgrantee through September 30, 2021 (Section 421(b) of GEPA (20 USC 1225(b)); 34 CFR sections 76.703 through 76.710). Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 12 of 12 expenditures selected for testing awards that started during the state fiscal year, the Department had charged the expense to the new federal fiscal year grant, however, the date of service on the invoice was for a period prior to the start of that federal award. Furthermore, during our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 12 of 40 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the Department had charged the expense to the old federal fiscal year grant, however, the date of service on the invoice was for a period subsequent to the end of that federal award. Lastly, the Department had a breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking. Cause The cause of the condition found is due to how the Department charges costs to federal grants and the breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking. Effect The effect of the condition found is that the Department did not comply with the period of performance regulations. Questioned Costs $117,634 - the amount of expenditures charged to the Fiscal Year 2019 award that related to a date of service subsequent to the end of liquidation period for that award $5,811 - the amount of expenditures charged to the Fiscal Year 2021 award that related to a date of service prior to the start of that federal award $593 - the amount of expenditures charged to the Fiscal Year 2018 award that related to a date of service subsequent to the end of liquidation period for that award Recommendation We recommend that the Department implement internal control and policies and procedures to ensure costs are appropriately charged to federal awards based on the incurred date. View of Responsible Officials The Department does not concur. The Department notes extensions are in place related to COVID-19 and the Tydings Amendment through the Department of Education mitigating the condition noted. The Department will confer with the US DE to clarify the extensions in place and resolve any disparities identified within the finding. Anticipated Completion Date: Completed as of the date of this report Contact Person: Lindsey Labonville, Melissa White Rejoinder Based on the supporting documentation provided by the Department, it did not appear that the expenses identified within the condition found were charged to the correct period of performance during the liquidation period. Subsequently management adjusted the CAN the expenses related to which would correct the condition found.
Finding Reference Number: 2022-016 NH Department of Education COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S425U210017, S425D200017, S425V210041, S425W210030, S425R210041, S425C210032, S425D210017 Federal Award Year: 2020, 2021 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2021-015 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the ?Transparency Act? that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2022, we noted the New Hampshire Department of Education (the Department) passed through $90,972,223 in Education Stabilization Funds to subrecipients. During out testwork over FFATA reporting at the Department, we selected 60 FFATA reports for testing and noted the following: See Schedule of Findings and Questioned Costs for Chart/Table Cause The cause of the condition found is due to a lack of policies and procedures, including internal controls, in place to ensure timely and accurate FFATA reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act. Questioned Costs None. Recommendation We recommend that the Department implement internal controls, policies, and procedures, across all Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials DLS has implemented a procedure across all ESF and ESEA programs to ensure timely and accurate reporting. DLS has also partnered with GSA to resolve issues within the FSRS (FFATA) system, however, there seems to be many technical issues on their end that their developers are currently working through. At the time of this finding, the technical issue on GSA?s side hasn?t been resolved. The procedure includes a flow chart, PowerPoint presentation, FAQ document, and process. Additionally, there have been numerous training opportunities both in person and online across the Division to train as many stakeholders as possible in the reporting and monitoring of FFATA to ensure timeliness and accuracy. In-person and online trainings were held on 01/04/23, 01/26/23, and 02/06/23. The United States Department of Education also recently held a FFATA webinar on 01/18/2023, which all ESF and ESEA program personnel involved in FFATA reporting where required to attend. Anticipated Completion Date: 02/06/2023 Contact Person: Jessica Lescarbeau, Bureau Administrator and Lindsey Labonville, Compliance Administrator
Finding Reference Number: 2022-016 NH Department of Education COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S425U210017, S425D200017, S425V210041, S425W210030, S425R210041, S425C210032, S425D210017 Federal Award Year: 2020, 2021 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2021-015 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the ?Transparency Act? that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2022, we noted the New Hampshire Department of Education (the Department) passed through $90,972,223 in Education Stabilization Funds to subrecipients. During out testwork over FFATA reporting at the Department, we selected 60 FFATA reports for testing and noted the following: See Schedule of Findings and Questioned Costs for Chart/Table Cause The cause of the condition found is due to a lack of policies and procedures, including internal controls, in place to ensure timely and accurate FFATA reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act. Questioned Costs None. Recommendation We recommend that the Department implement internal controls, policies, and procedures, across all Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials DLS has implemented a procedure across all ESF and ESEA programs to ensure timely and accurate reporting. DLS has also partnered with GSA to resolve issues within the FSRS (FFATA) system, however, there seems to be many technical issues on their end that their developers are currently working through. At the time of this finding, the technical issue on GSA?s side hasn?t been resolved. The procedure includes a flow chart, PowerPoint presentation, FAQ document, and process. Additionally, there have been numerous training opportunities both in person and online across the Division to train as many stakeholders as possible in the reporting and monitoring of FFATA to ensure timeliness and accuracy. In-person and online trainings were held on 01/04/23, 01/26/23, and 02/06/23. The United States Department of Education also recently held a FFATA webinar on 01/18/2023, which all ESF and ESEA program personnel involved in FFATA reporting where required to attend. Anticipated Completion Date: 02/06/2023 Contact Person: Jessica Lescarbeau, Bureau Administrator and Lindsey Labonville, Compliance Administrator
Finding Reference Number: 2022-016 NH Department of Education COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S425U210017, S425D200017, S425V210041, S425W210030, S425R210041, S425C210032, S425D210017 Federal Award Year: 2020, 2021 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2021-015 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the ?Transparency Act? that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2022, we noted the New Hampshire Department of Education (the Department) passed through $90,972,223 in Education Stabilization Funds to subrecipients. During out testwork over FFATA reporting at the Department, we selected 60 FFATA reports for testing and noted the following: See Schedule of Findings and Questioned Costs for Chart/Table Cause The cause of the condition found is due to a lack of policies and procedures, including internal controls, in place to ensure timely and accurate FFATA reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act. Questioned Costs None. Recommendation We recommend that the Department implement internal controls, policies, and procedures, across all Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials DLS has implemented a procedure across all ESF and ESEA programs to ensure timely and accurate reporting. DLS has also partnered with GSA to resolve issues within the FSRS (FFATA) system, however, there seems to be many technical issues on their end that their developers are currently working through. At the time of this finding, the technical issue on GSA?s side hasn?t been resolved. The procedure includes a flow chart, PowerPoint presentation, FAQ document, and process. Additionally, there have been numerous training opportunities both in person and online across the Division to train as many stakeholders as possible in the reporting and monitoring of FFATA to ensure timeliness and accuracy. In-person and online trainings were held on 01/04/23, 01/26/23, and 02/06/23. The United States Department of Education also recently held a FFATA webinar on 01/18/2023, which all ESF and ESEA program personnel involved in FFATA reporting where required to attend. Anticipated Completion Date: 02/06/2023 Contact Person: Jessica Lescarbeau, Bureau Administrator and Lindsey Labonville, Compliance Administrator
2022-001 ? Significant Deficiency in Internal Control over Financial Reporting and Compliance over Allowable Costs/Cost Principles ? Payroll Allocations * ALN and Title: 84.287 Twenty-First Century Community Learning Centers * Award Number: S287C200002 * Award Year: July 1, 2021 through June 30, 2022 * Criteria: Per 2 CFR 200.303, Internal Controls, a 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. * Condition: During the year the control that was designed failed to ensure that proper allocation based on actual hours worked were applied to the grant. * Cause: The internal control system did not have a sufficient control process in place to ensure all payroll expenses are properly reviewed for errors and approved prior to allocation and charge outs to grants being made. * Effect or potential effect: The Organization received reimbursement for ineligible labor expenses. * Recommendation: We recommend the Organization review and revise its current internal control procedures to ensure all employee wage allocations for grant charge outs are reviewed and agreed to actual hours worked per timesheets. * View of Responsible Officials: Please refer to Correction Action Plan * Questioned Costs - None, once the issue was identified during the allowable cost testwork, Boys and Girls Club of the Kenai Peninsula made the proper corrections to exclude those wages that weren?t actual worked within the program and included wages that were allowable. The remaining unallowable costs were then evaluated and were below both known and likely questioned costs threshold
FINDING 2022-001 Subject: Child Nutrition Cluster - Allowable Costs/Cost Principles Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children, COVID-19 - Summer Food Service Program for Children Assistance Listings Numbers: 10.553, 10.555, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY 2021, FY 2022 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Allowable Costs/Cost Principles Audit Findings: Material Weakness, Other MattersCondition and Context An effective system of internal control was not in place at the School Corporation to ensure compliance with requirements related to the grant agreement and the Allowable Costs/Cost Principles compliance requirement. During the audit period, an employee had duties related to the operation of the food service program and other nonfederal duties. The employee's wages were paid from both grant and nongrant funds. However, the employee did not maintain documentation of time spent on each activity. Therefore, all salary costs charged to the Child Nutrition Cluster during the time the employee performed both roles were considered questioned costs. Total questioned costs were $36,424. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.430(i) states in part: "Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities . . . (iv) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. . . ." INDIANA STATE BOARD OF ACCOUNTS 14 HANOVER COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause Management had not developed an effective system of internal control that would have ensured compliance with the grant agreement and the Allowable Costs/Cost Principles compliance requirement. Effect The failure to establish an effective system of internal control, as well as adequately document costs, enabled noncompliance to go undetected. Noncompliance with the grant agreement and the Allowable Costs/Cost Principles compliance requirement could result in the loss of future federal funds to the School Corporation. Questioned Costs Known questioned costs of $36,424 were identified as detailed in the Condition and Context. Recommendation We recommended that the School Corporation's management establish a system of internal control to ensure that documentation will be maintained and comply with the grant agreement and the Allowable Costs/Cost Principles compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-001 Subject: Child Nutrition Cluster - Allowable Costs/Cost Principles Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children, COVID-19 - Summer Food Service Program for Children Assistance Listings Numbers: 10.553, 10.555, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY 2021, FY 2022 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Allowable Costs/Cost Principles Audit Findings: Material Weakness, Other MattersCondition and Context An effective system of internal control was not in place at the School Corporation to ensure compliance with requirements related to the grant agreement and the Allowable Costs/Cost Principles compliance requirement. During the audit period, an employee had duties related to the operation of the food service program and other nonfederal duties. The employee's wages were paid from both grant and nongrant funds. However, the employee did not maintain documentation of time spent on each activity. Therefore, all salary costs charged to the Child Nutrition Cluster during the time the employee performed both roles were considered questioned costs. Total questioned costs were $36,424. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.430(i) states in part: "Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities . . . (iv) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. . . ." INDIANA STATE BOARD OF ACCOUNTS 14 HANOVER COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause Management had not developed an effective system of internal control that would have ensured compliance with the grant agreement and the Allowable Costs/Cost Principles compliance requirement. Effect The failure to establish an effective system of internal control, as well as adequately document costs, enabled noncompliance to go undetected. Noncompliance with the grant agreement and the Allowable Costs/Cost Principles compliance requirement could result in the loss of future federal funds to the School Corporation. Questioned Costs Known questioned costs of $36,424 were identified as detailed in the Condition and Context. Recommendation We recommended that the School Corporation's management establish a system of internal control to ensure that documentation will be maintained and comply with the grant agreement and the Allowable Costs/Cost Principles compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-001 Subject: Child Nutrition Cluster - Allowable Costs/Cost Principles Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children, COVID-19 - Summer Food Service Program for Children Assistance Listings Numbers: 10.553, 10.555, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY 2021, FY 2022 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Allowable Costs/Cost Principles Audit Findings: Material Weakness, Other MattersCondition and Context An effective system of internal control was not in place at the School Corporation to ensure compliance with requirements related to the grant agreement and the Allowable Costs/Cost Principles compliance requirement. During the audit period, an employee had duties related to the operation of the food service program and other nonfederal duties. The employee's wages were paid from both grant and nongrant funds. However, the employee did not maintain documentation of time spent on each activity. Therefore, all salary costs charged to the Child Nutrition Cluster during the time the employee performed both roles were considered questioned costs. Total questioned costs were $36,424. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.430(i) states in part: "Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities . . . (iv) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. . . ." INDIANA STATE BOARD OF ACCOUNTS 14 HANOVER COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause Management had not developed an effective system of internal control that would have ensured compliance with the grant agreement and the Allowable Costs/Cost Principles compliance requirement. Effect The failure to establish an effective system of internal control, as well as adequately document costs, enabled noncompliance to go undetected. Noncompliance with the grant agreement and the Allowable Costs/Cost Principles compliance requirement could result in the loss of future federal funds to the School Corporation. Questioned Costs Known questioned costs of $36,424 were identified as detailed in the Condition and Context. Recommendation We recommended that the School Corporation's management establish a system of internal control to ensure that documentation will be maintained and comply with the grant agreement and the Allowable Costs/Cost Principles compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-001 Subject: Child Nutrition Cluster - Allowable Costs/Cost Principles Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children, COVID-19 - Summer Food Service Program for Children Assistance Listings Numbers: 10.553, 10.555, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY 2021, FY 2022 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Allowable Costs/Cost Principles Audit Findings: Material Weakness, Other MattersCondition and Context An effective system of internal control was not in place at the School Corporation to ensure compliance with requirements related to the grant agreement and the Allowable Costs/Cost Principles compliance requirement. During the audit period, an employee had duties related to the operation of the food service program and other nonfederal duties. The employee's wages were paid from both grant and nongrant funds. However, the employee did not maintain documentation of time spent on each activity. Therefore, all salary costs charged to the Child Nutrition Cluster during the time the employee performed both roles were considered questioned costs. Total questioned costs were $36,424. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.430(i) states in part: "Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities . . . (iv) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. . . ." INDIANA STATE BOARD OF ACCOUNTS 14 HANOVER COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause Management had not developed an effective system of internal control that would have ensured compliance with the grant agreement and the Allowable Costs/Cost Principles compliance requirement. Effect The failure to establish an effective system of internal control, as well as adequately document costs, enabled noncompliance to go undetected. Noncompliance with the grant agreement and the Allowable Costs/Cost Principles compliance requirement could result in the loss of future federal funds to the School Corporation. Questioned Costs Known questioned costs of $36,424 were identified as detailed in the Condition and Context. Recommendation We recommended that the School Corporation's management establish a system of internal control to ensure that documentation will be maintained and comply with the grant agreement and the Allowable Costs/Cost Principles compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-001 Subject: Child Nutrition Cluster - Allowable Costs/Cost Principles Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children, COVID-19 - Summer Food Service Program for Children Assistance Listings Numbers: 10.553, 10.555, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY 2021, FY 2022 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Allowable Costs/Cost Principles Audit Findings: Material Weakness, Other MattersCondition and Context An effective system of internal control was not in place at the School Corporation to ensure compliance with requirements related to the grant agreement and the Allowable Costs/Cost Principles compliance requirement. During the audit period, an employee had duties related to the operation of the food service program and other nonfederal duties. The employee's wages were paid from both grant and nongrant funds. However, the employee did not maintain documentation of time spent on each activity. Therefore, all salary costs charged to the Child Nutrition Cluster during the time the employee performed both roles were considered questioned costs. Total questioned costs were $36,424. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.430(i) states in part: "Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities . . . (iv) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. . . ." INDIANA STATE BOARD OF ACCOUNTS 14 HANOVER COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause Management had not developed an effective system of internal control that would have ensured compliance with the grant agreement and the Allowable Costs/Cost Principles compliance requirement. Effect The failure to establish an effective system of internal control, as well as adequately document costs, enabled noncompliance to go undetected. Noncompliance with the grant agreement and the Allowable Costs/Cost Principles compliance requirement could result in the loss of future federal funds to the School Corporation. Questioned Costs Known questioned costs of $36,424 were identified as detailed in the Condition and Context. Recommendation We recommended that the School Corporation's management establish a system of internal control to ensure that documentation will be maintained and comply with the grant agreement and the Allowable Costs/Cost Principles compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-001 Subject: Child Nutrition Cluster - Allowable Costs/Cost Principles Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children, COVID-19 - Summer Food Service Program for Children Assistance Listings Numbers: 10.553, 10.555, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY 2021, FY 2022 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Allowable Costs/Cost Principles Audit Findings: Material Weakness, Other MattersCondition and Context An effective system of internal control was not in place at the School Corporation to ensure compliance with requirements related to the grant agreement and the Allowable Costs/Cost Principles compliance requirement. During the audit period, an employee had duties related to the operation of the food service program and other nonfederal duties. The employee's wages were paid from both grant and nongrant funds. However, the employee did not maintain documentation of time spent on each activity. Therefore, all salary costs charged to the Child Nutrition Cluster during the time the employee performed both roles were considered questioned costs. Total questioned costs were $36,424. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.430(i) states in part: "Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities . . . (iv) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. . . ." INDIANA STATE BOARD OF ACCOUNTS 14 HANOVER COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause Management had not developed an effective system of internal control that would have ensured compliance with the grant agreement and the Allowable Costs/Cost Principles compliance requirement. Effect The failure to establish an effective system of internal control, as well as adequately document costs, enabled noncompliance to go undetected. Noncompliance with the grant agreement and the Allowable Costs/Cost Principles compliance requirement could result in the loss of future federal funds to the School Corporation. Questioned Costs Known questioned costs of $36,424 were identified as detailed in the Condition and Context. Recommendation We recommended that the School Corporation's management establish a system of internal control to ensure that documentation will be maintained and comply with the grant agreement and the Allowable Costs/Cost Principles compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-001 Subject: Child Nutrition Cluster - Allowable Costs/Cost Principles Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children, COVID-19 - Summer Food Service Program for Children Assistance Listings Numbers: 10.553, 10.555, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY 2021, FY 2022 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Allowable Costs/Cost Principles Audit Findings: Material Weakness, Other MattersCondition and Context An effective system of internal control was not in place at the School Corporation to ensure compliance with requirements related to the grant agreement and the Allowable Costs/Cost Principles compliance requirement. During the audit period, an employee had duties related to the operation of the food service program and other nonfederal duties. The employee's wages were paid from both grant and nongrant funds. However, the employee did not maintain documentation of time spent on each activity. Therefore, all salary costs charged to the Child Nutrition Cluster during the time the employee performed both roles were considered questioned costs. Total questioned costs were $36,424. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.430(i) states in part: "Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities . . . (iv) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. . . ." INDIANA STATE BOARD OF ACCOUNTS 14 HANOVER COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause Management had not developed an effective system of internal control that would have ensured compliance with the grant agreement and the Allowable Costs/Cost Principles compliance requirement. Effect The failure to establish an effective system of internal control, as well as adequately document costs, enabled noncompliance to go undetected. Noncompliance with the grant agreement and the Allowable Costs/Cost Principles compliance requirement could result in the loss of future federal funds to the School Corporation. Questioned Costs Known questioned costs of $36,424 were identified as detailed in the Condition and Context. Recommendation We recommended that the School Corporation's management establish a system of internal control to ensure that documentation will be maintained and comply with the grant agreement and the Allowable Costs/Cost Principles compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Reference Number: 2022-002 Prior Year Finding: No Federal Agency: U.S. Department of Housing and Urban Development Federal Program: Community Development Block Grants/Entitlement Grants Assistance Listing Number: 14.218 Award Number and Year: B-19-UC-24-0002 (7/31/2019 ? 9/1/2027), B-20-UC-24-0002 (8/17/2020 ? 9/1/2028), B-21-UC-24-0002 (10/27/2021 ? 9/1/2029) Compliance Requirement: Reporting ? Federal Funding Accountability and Transparency Act (FFATA) Type of Finding Material Weakness in Internal Control Over Compliance, Material Noncompliance Criteria or specific requirement: Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements. The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.) Control: Per 2 CFR section 200.303(a), a 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 comply 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). Section III ? Federal Award Findings and Questioned Costs (Continued) Condition: Prince George?s County (County) did not report required subaward information to FSRS for first-tier subawards of $30,000 or more. Context: Zero of seven subawards selected for testing were reported to FSRS. Total subawards tested were $3,867,912, and $0 was reported as required by FFATA requirements. SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLE Cause: The County?s policies and procedures were not sufficient to ensure that required subaward information was reported to FSRS. Internal controls did not prevent or detect the errors. Effect: Subawards were not reported to FSRS in accordance with FFATA requirements. Questioned costs: None noted. Recommendation: We recommend that the County develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the County develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS. Views of responsible officials:
Reference Number: 2022-003 Prior Year Finding: No Federal Agency: U.S. Department of Housing and Urban Development Federal Program: Community Development Block Grants/Entitlement Grants Assistance Listing Number: 14.218 Award Number and Year: B-19-UC-24-0002 (7/31/2019 ? 9/1/2027), B-20-UC-24-0002 (8/17/2020 ? 9/1/2028), B-21-UC-24-0002 (10/27/2021 ? 9/1/2029) Compliance Requirement: Reporting ? Performance Reporting Type of Finding Material Weakness in Internal Control Over Compliance, Material Noncompliance Criteria or specific requirement: Compliance: Per 24 CFR Part 75, beginning in July 2021, grantees shall enter Section 3 activities on the closeout screens in the Integrated Disbursement and Information System (IDIS) as well as within their annual reporting in the Consolidated Annual Performance and Evaluation Report (CAPER). Section 3 projects are housing rehabilitation, housing construction, and other public construction projects assisted under HUD programs that provide housing and community development financial assistance when the total amount of assistance to the project exceeds a threshold of $200,000. Control: Per 2 CFR section 200.303(a), a 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 comply 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). Condition: Prince George?s County (County) did not submit a report of Section 3 activities in IDIS as required. Context: Zero of one project subject to Section 3 reporting requirements was submitted in IDIS. The County prepared the report for this project, but it did not submit it in IDIS as required. Cause: The County?s policies and procedures were not sufficient to ensure that Section 3 reports were completed and submitted in IDIS as required by program regulations. Internal controls did not prevent or detect the error. Effect: The County was not in compliance with Section 3 reporting requirements. Section III ? Federal Award Findings and Questioned Costs (Continued) Questioned costs: None noted. Recommendation: We recommend that the County develop internal controls and procedures to ensure that Section 3 reports are completed and submitted timely in IDIS as required by 24 CFR Part 75. Views of responsible officials:
Reference Number: 2022-004 Prior Year Finding: No Federal Agency: U.S. Department of Housing and Urban Development Federal Program: Community Development Block Grants/Entitlement Grants Assistance Listing Number: 14.218 Award Number and Year: B-19-UC-24-0002 (7/31/2019 ? 9/1/2027), B-20-UC-24-0002 (8/17/2020 ? 9/1/2028), B-21-UC-24-0002 (10/27/2021 ? 9/1/2029) Compliance Requirement: Special Tests and Provisions ? Wage Rate Requirements Type of Finding Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Compliance: All laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by federal assistance funds must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL). Nonfederal entities shall include in their construction contracts subject to the Wage Rate Requirements a provision that the contractor or subcontractor comply with those requirements and DOL regulations (29 CFR Part 5, Labor Standards Provisions Applicable to Contacts Governing Federally Financed and Assisted Construction). This includes a requirement for the contractor or subcontractor to submit to the nonfederal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance. Wage Rate Requirements apply to the rehabilitation of residential property only if such property contains eight or more units. However, the requirements do not apply to volunteer work where the volunteer does not receive compensation, or is paid expenses, reasonable benefits or a nominal fee for such services, and is not otherwise employed at any time in construction work. Control: Per 2 CFR section 200.303(a), a 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 comply 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). Condition: Prince George?s County (County) did not ensure a construction project complied with wage rate requirements. Context: One of five construction projects selected for testing was not in compliance with wage rate requirements. The contract did not include the required wage rate provisions, nor did wage rate reporting occur for this project. Section III ? Federal Award Findings and Questioned Costs (Continued) Cause: The County?s policies and procedures were not sufficient to ensure that all contracts complied with wage rate requirements. Internal controls did not prevent or detect the error. Effect: The County was unable to ensure that the contractor?s employees were paid wages not less than those established for the locality of the project (prevailing wage rates) by DOL. Questioned costs: None noted. Recommendation: We recommend that the County develop internal controls and procedures to ensure that all construction contracts subject to wage rate requirements include the relevant provisions and that it establishes weekly reporting procedures with the contractor to ensure compliance. Views of responsible officials:
Reference Number: 2022-002 Prior Year Finding: No Federal Agency: U.S. Department of Housing and Urban Development Federal Program: Community Development Block Grants/Entitlement Grants Assistance Listing Number: 14.218 Award Number and Year: B-19-UC-24-0002 (7/31/2019 ? 9/1/2027), B-20-UC-24-0002 (8/17/2020 ? 9/1/2028), B-21-UC-24-0002 (10/27/2021 ? 9/1/2029) Compliance Requirement: Reporting ? Federal Funding Accountability and Transparency Act (FFATA) Type of Finding Material Weakness in Internal Control Over Compliance, Material Noncompliance Criteria or specific requirement: Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements. The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.) Control: Per 2 CFR section 200.303(a), a 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 comply 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). Section III ? Federal Award Findings and Questioned Costs (Continued) Condition: Prince George?s County (County) did not report required subaward information to FSRS for first-tier subawards of $30,000 or more. Context: Zero of seven subawards selected for testing were reported to FSRS. Total subawards tested were $3,867,912, and $0 was reported as required by FFATA requirements. SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLE Cause: The County?s policies and procedures were not sufficient to ensure that required subaward information was reported to FSRS. Internal controls did not prevent or detect the errors. Effect: Subawards were not reported to FSRS in accordance with FFATA requirements. Questioned costs: None noted. Recommendation: We recommend that the County develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the County develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS. Views of responsible officials:
Reference Number: 2022-003 Prior Year Finding: No Federal Agency: U.S. Department of Housing and Urban Development Federal Program: Community Development Block Grants/Entitlement Grants Assistance Listing Number: 14.218 Award Number and Year: B-19-UC-24-0002 (7/31/2019 ? 9/1/2027), B-20-UC-24-0002 (8/17/2020 ? 9/1/2028), B-21-UC-24-0002 (10/27/2021 ? 9/1/2029) Compliance Requirement: Reporting ? Performance Reporting Type of Finding Material Weakness in Internal Control Over Compliance, Material Noncompliance Criteria or specific requirement: Compliance: Per 24 CFR Part 75, beginning in July 2021, grantees shall enter Section 3 activities on the closeout screens in the Integrated Disbursement and Information System (IDIS) as well as within their annual reporting in the Consolidated Annual Performance and Evaluation Report (CAPER). Section 3 projects are housing rehabilitation, housing construction, and other public construction projects assisted under HUD programs that provide housing and community development financial assistance when the total amount of assistance to the project exceeds a threshold of $200,000. Control: Per 2 CFR section 200.303(a), a 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 comply 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). Condition: Prince George?s County (County) did not submit a report of Section 3 activities in IDIS as required. Context: Zero of one project subject to Section 3 reporting requirements was submitted in IDIS. The County prepared the report for this project, but it did not submit it in IDIS as required. Cause: The County?s policies and procedures were not sufficient to ensure that Section 3 reports were completed and submitted in IDIS as required by program regulations. Internal controls did not prevent or detect the error. Effect: The County was not in compliance with Section 3 reporting requirements. Section III ? Federal Award Findings and Questioned Costs (Continued) Questioned costs: None noted. Recommendation: We recommend that the County develop internal controls and procedures to ensure that Section 3 reports are completed and submitted timely in IDIS as required by 24 CFR Part 75. Views of responsible officials:
Reference Number: 2022-004 Prior Year Finding: No Federal Agency: U.S. Department of Housing and Urban Development Federal Program: Community Development Block Grants/Entitlement Grants Assistance Listing Number: 14.218 Award Number and Year: B-19-UC-24-0002 (7/31/2019 ? 9/1/2027), B-20-UC-24-0002 (8/17/2020 ? 9/1/2028), B-21-UC-24-0002 (10/27/2021 ? 9/1/2029) Compliance Requirement: Special Tests and Provisions ? Wage Rate Requirements Type of Finding Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Compliance: All laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by federal assistance funds must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL). Nonfederal entities shall include in their construction contracts subject to the Wage Rate Requirements a provision that the contractor or subcontractor comply with those requirements and DOL regulations (29 CFR Part 5, Labor Standards Provisions Applicable to Contacts Governing Federally Financed and Assisted Construction). This includes a requirement for the contractor or subcontractor to submit to the nonfederal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance. Wage Rate Requirements apply to the rehabilitation of residential property only if such property contains eight or more units. However, the requirements do not apply to volunteer work where the volunteer does not receive compensation, or is paid expenses, reasonable benefits or a nominal fee for such services, and is not otherwise employed at any time in construction work. Control: Per 2 CFR section 200.303(a), a 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 comply 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). Condition: Prince George?s County (County) did not ensure a construction project complied with wage rate requirements. Context: One of five construction projects selected for testing was not in compliance with wage rate requirements. The contract did not include the required wage rate provisions, nor did wage rate reporting occur for this project. Section III ? Federal Award Findings and Questioned Costs (Continued) Cause: The County?s policies and procedures were not sufficient to ensure that all contracts complied with wage rate requirements. Internal controls did not prevent or detect the error. Effect: The County was unable to ensure that the contractor?s employees were paid wages not less than those established for the locality of the project (prevailing wage rates) by DOL. Questioned costs: None noted. Recommendation: We recommend that the County develop internal controls and procedures to ensure that all construction contracts subject to wage rate requirements include the relevant provisions and that it establishes weekly reporting procedures with the contractor to ensure compliance. Views of responsible officials:
Program: Various, including AL 10.561 ? State Administrative Matching Grants for the Supplemental Nutrition Assistance Program; AL 93.558 ? Temporary Assistance for Needy Families; AL 93.566 ? Refugee and Entrant Assistance State/Replacement Designee Administered Programs; AL 93.575 ? Child Care and Development Block Grant ? Allowable Costs/Cost Principles Grant Number & Year: Various, including 202121S251443, FFY 2021; 202222S251443, FFY 2022; 1901NETANF, FFY 2019; 2101NERCMA, FFY 2021; 2201NERCMA, FFY 2022; 2201NECCDD, FFY 2022 Federal Grantor Agency: U.S. Department of Agriculture and U.S. Department of Health and Human Services Criteria: 45 CFR ? 75.303 (October 1, 2021) states, in relevant part, the following: 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. 45 CFR ? 75.403 (October 1, 2021) requires costs to be necessary, reasonable, and adequately documented. 45 CFR ? 75.302 (October 1, 2021) requires financial management systems of the State sufficient to permit both preparation of required reports and tracing of funds to expenditures adequate to establish that the use of those funds was in accordance with applicable regulations. 45 CFR ? 75.405(a) (October 1, 2021) states, in part, the following: A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. Per 2 CFR ? 400.1 (January 1, 2022), the U.S. Department of Agriculture adopted the OMB Uniform Guidance as its policies and procedures for uniform administrative requirements, cost principles, and audit requirements for Federal awards. 2 CFR ? 200.303 (January 1, 2022) states, in part, the following: 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. 2 CFR ? 200.403 (January 1, 2022) requires costs to be reasonable, necessary, and adequately documented. 2 CFR ? 200.405(a) (January 1, 2022) states, in part, the following: A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. 45 CFR ? 75.511(b) and 2 CFR ? 200.511(b) (January 1, 2022) state, in relevant part, the following: The summary schedule of prior audit findings must report the status of all audit findings included in the prior audit?s schedule of findings and questioned costs. . . . * * * * (2) When audit findings were not corrected or were only partially corrected, the summary schedule must describe the reasons for the finding?s recurrence and planned corrective action, and any partial corrective action taken. When corrective action taken is significantly different from corrective action previously reported in a corrective action plan or in the Federal agency?s or pass-through entity?s management decision, the summary schedule must provide an explanation. Good internal control requires procedures to ensure that amounts charged to Federal programs are proper. Condition: The Agency did not properly charge Federal programs for seven allocations tested. A similar finding was noted in the prior audit. The Summary Schedule of Prior Audit Findings lists the status as completed. Repeat Finding: 2021-031, 2021-032 Questioned Costs: $44,356 known See Schedule of Findings and Questioned Costs for chart/table. Statistical Sample: No Context: For seven of 14 allocations tested, we noted the following: ? We tested the allocation of cost center 25C21940 Field Office Resource Development for the quarter ended September 30, 2021, which is allocated based on Time & Effort reports. The payroll costs for 85 employees were charged to the cost center; however, four of the employees? payroll costs should not have been charged to the cost center. The four employees tested included a Federal Aid Administrator, a Program Accuracy Specialist, and two Office Specialists. The supervisors they worked with were not charged to this cost center, and the employees were not employed as Resource Developers, which was the job title of most of the employees included in this cost center. As a result of these employees being charged to the Resource Development cost center instead of their appropriate cost centers, Child Care and Development, Foster Care, Adoption Assistance, Guardianship Assistance, and Medicaid were not charged correctly, ranging from undercharges of $2,653 to overcharges of $2,402. Additionally, we were unable to determine how the payroll costs of $9,858 to the Federal Aid Administrator should have been allocated. The Resource Development cost center allocated $1,444,162 for the quarter ended September 30, 2021. A similar finding was noted in the prior audit. ? We tested the allocation of cost center 25C20680 Legal Services General Legal Teams for the quarter ended June 30, 2022, which is allocated based on Time & Effort reports. The payroll costs for a Legislative Coordinator were recorded to this cost center during the quarter. However, these costs should have been recorded to cost center 25C20720 Communications and Legislative Services Administration. As a result, this employee?s payroll costs of $15,777 during the quarter were not allocated to Federal programs correctly. We were unable to determine how these payroll costs should have been allocated. The Legal Services General Legal Teams cost center allocated $1,332,052 for the quarter ended June 30, 2022. ? We tested the allocation of cost center 25C21960 Field Office Social Services Casework for quarter ended September 30, 2021, which is allocated based on random moment time studies (RMTS) results. The Bridges to Independence program and Guardianship Assistance program should have been allocated $1,464 each from this cost center; however, the Agency did not include these programs in the allocation. As a result, the Federal grants for Refugee and Entrant Assistance, Child Care and Development, Foster Care, Adoption Assistance, Temporary Assistance to Needy Families (TANF), Supplemental Nutrition Assistance Program (SNAP), and Medicaid were overcharged, ranging from $3 to $982, and the Guardianship Assistance grant was undercharged $732. The Field Office Social Services Casework cost center allocated $8,099,617 for the quarter ended September 30, 2021. ? We tested the allocation of cost center 25C21920 Field Office Child Protection & Safety Services for the quarter ended June 30, 2022, which is allocated based on RMTS results. The Agency began using a new RMTS system in January 2022; however, the Agency did not set up the quarterly summary reports correctly. Below are the issues noted: o RMTS observations for Trial Home Visits were not included in the allocation. As a result, State programs were undercharged, and Federal programs were overcharged. o The RMTS observations for Child Protection Initial Assessment were not properly allocated. As a result, Foster Care was overcharged, and Adoption and Guardianship were undercharged. o The RMTS observations for Before or After Work Hours were incorrectly included in the State?s allocation. As a result, Federal programs were undercharged. In total, Federal grants for Adoption Assistance, Foster Care, and Guardianship Assistance were undercharged $28,560, $113,762, and $1,990, respectively. The Field Office Child Protection & Safety Services cost center allocated $12,429,881 for the quarter ended June 30, 2022. ? We tested the allocation of cost center 25C21910 Field Office Administration for the quarter ended June 30, 2022, which is allocated based on labor hours. The Agency did not include all of the applicable labor hours for the Medicaid program. As a result, the Federal grants for Adoption Assistance, Foster Care, Guardianship Assistance, Refugee and Entrant Assistance, Child Care and Development, TANF, and SNAP were overcharged, ranging from $265 to $30,556, and the Medicaid grant was undercharged $235,906. The Field Office Administration cost center allocated $3,236,547 for the quarter ended June 30, 2022. ? We tested the allocation of cost center 25C20990 IST Application NFOCUS Applications for the quarter ended September 30, 2021, which is allocated based on client counts per NFOCUS/MMIS reports. We noted that the Foster Care and TANF recipient counts used in the allocation did not agree to support. The Foster Care count included 71 clients that were paid with State funds, resulting in $265 being overcharged to the Foster Care grant, and the TANF count included 48 clients that were paid with State funds, resulting in $358 being overcharged to the TANF grant. Additionally, we were unable to trace the member counts to documentation that supported allocating $1,853,284 to Medicaid and $283,190 to the Children?s Health Insurance Program (CHIP). The Agency did not maintain the member count reports used at the time of the allocation. The Agency was able to generate a historical report; however, while the report amounts were similar, they did not agree with the counts used in the allocation. The Agency did maintain system summary reports at the time of the allocation, and the total counts on the summary reports did agree to amounts used for the allocation. However, as the summary reports used did not maintain the detail of members counted, we could not verify the accuracy of the reports used. The IST Application Services NFOCUS Applications cost center allocated $3,800,340 for the quarter ended September 30, 2021. ? We tested the allocation of cost center 25C23823 iServe IAPD H971 ? Shared for the quarter ending June 30, 2022. The Agency is developing the new iServe Nebraska Portal, which is an application for Nebraskans to apply for benefits from Federal and State programs. This application will be replacing ACCESSNebraska, the current application used by Nebraskans to apply for benefits. For the implementation phase of the project, the Agency was only allocating costs to the following four programs: LIHEAP, TANF, SNAP, and Medicaid. However, there are other Federal and State programs that will utilize the iServe application. We asked for documentation to support that these were the only four programs that were benefiting from this stage of the project. The Agency provided correspondence from its Federal contacts, which stated: ?As long as SNAP, Medicaid, LIHEAP, and TANF are the only benefiting programs for the State?s iServe Nebraska Portal project, the State may just include these four programs in the development of its cost allocation plan. If/when the State decides to add other Federal programs that will benefit from enhancements to the portal, it will need to revisit and adjust its cost allocation plan.? We asked again for documentation, such as internal planning documents, to support that these were the only four programs benefiting from this stage of the project. The Agency replied that it did not have the documentation at this time. The iServe IAPD H971 ? Shared cost center allocated $6,019,121 for the quarter ended June 30, 2022. We were unable to determine questioned costs as we were not able to determine which Federal and State program should receive an allocation, and the basis for how the costs would be allocated to these programs. Cause: Inadequate procedures to ensure that system reports were set up correctly, employees coded their time correctly, and allocations were adequately supported and calculated correctly. Effect: Without adequate documentation to support the allocation of costs, there is increased risk of programs not being charged the proper amounts. Recommendation: We recommend the Agency improve procedures to ensure that employee pay is recorded correctly in E1, system reports are set up correctly, and costs are properly allocated and charged. Management Response: The Agency agrees.
Program: AL 93.558 ? Temporary Assistance to Needy Families; AL 10.561 ? State Administrative Matching Grants for the Supplemental Nutrition Assistance Program; AL 93.658 ? Foster Care Title IV-E ? Allowable Cost/Cost Principles Grant Number & Year: 1901NETANF, FFY 2019; 2101NEFOST, FFY 2021; 2201NEFOST, FFY 2022; 202121S251443, FFY 2021; 202222S251443, FFY 2022 Federal Grantor Agency: U.S. Department of Agriculture and U.S. Department of Health and Human Services Criteria: Per 45 CFR ? 75.303 (October 1, 2021): 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. 45 CFR ? 75.403 (October 1, 2021) requires costs to be reasonable, necessary, and adequately documented. 45 CFR ? 75.405(a) (October 1, 2021) states, in part, the following: A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. Per 2 CFR ? 200.303 (January 1, 2022): The non-Federal entity must: (a) Establish and maintain effective internal control 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. 2 CFR ? 200.403 (January 1, 2022) requires costs to be reasonable, necessary, and adequately documented. 2 CFR ? 200.405(a) (January 1, 2022) states, in part, the following: A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. Per the CAP, ?The RMTS Administrator is an employee of the Division of Children and Family Services and is responsible for . . . . verification that all forms are submitted to the Completed Surveys database, review of the worker entries to validate consistent practice among participants . . . .? Per the CAP, ?Each worker should be trained in the completion of the observation form and to the importance of providing accurate and timely responses.? According to RMTS Explanations: 1. Case Work ? Select this item if you were working on a specific case at the observation time. If you select this item you will be asked to enter the NFOCUS master case number. If there is not an NFOCUS master case, use any other number or description that can be used to identify the case . . . . According to the RMTS Instructions for the Worker: ?After the observation form has been submitted and validated (if selected for validation), it is reviewed by a member of the CFS and Cost Accounting Office for consistency.? According to the RMTS Instructions for the Supervisor: ?If you agree with the worker?s selections, you can click the ?VALIDATION? button. If you do not agree with the worker?s selections, you need to confer with the worker on the selection process and reach agreement on the proper selections for the form. Make updates as needed, and click the ?VALIDATION? button to attach the supervisor?s electronic signature and validate the form.? Good internal control and sound accounting practices require procedures to ensure that staff know how to complete accurate random moment time studies, which are used to allocate costs to Federal programs. Condition: The Agency did not have adequate procedures to ensure the accuracy of the RMTS. A similar finding was noted in the prior audit. Repeat Finding: 2021-033 Questioned Costs: $14,131 known See Schedule of Findings and Questioned Costs for chart/table. Statistical Sample: No Context: The RMTS is conducted on an ongoing basis to provide data for the allocation of direct and indirect costs to various programs. The objective is to identify employee efforts directly related to programs administered by the Agency. We tested 48 validated RMTS observations and noted that inadequate documentation was provided on 11 of them. We noted the following: ? For two of four Foster Care IV-E observations tested, the observations should have been reported as Foster Care Non IV-E per the documentation in the case files. For one of these observations, the case worker noted in the comments that she selected the wrong option. However, it was still validated without correction. ? For five of 21 SNAP observations tested, the RMTS observation form appeared to have been completed incorrectly by the case worker. For two of these observations, the case worker selected the SNAP program; however, per the case files, the case worker appeared to be working on other programs along with SNAP at the time of the observation or was not working on SNAP at all at the time of the observation. As we could not confirm from the documentation on file what the case worker was working on, the questioned costs are unknown. For the other three observations, the case workers did not document which cases they were working on. ? For four of 12 TANF observations tested, the RMTS observation forms appeared to have been completed incorrectly by the case workers. The case workers selected the TANF program; however, per the case files, the case workers appeared to be working on other programs along with TANF at the time of the observation, or, for one case, not working on TANF at all. As we could not confirm from the documentation on file what the case worker was working on, the questioned costs are unknown. Total known Federal payment errors, amount tested, error rate (amount of errors/ amount tested), total dollars charged via RMTS, and potential dollars at risk (dollar rate multiplied by the population total dollars charged) are summarized below by program: See Schedule of Findings and Questioned Costs for chart/table. The APA also inquired with Agency staff to determine if they were provided training in how to complete the random moment time studies. For one individual, the Agency was unable to provide documentation to support that the employee selected had completed RMTS training. Cause: The Agency?s training of staff and supervisory reviews of RMTS observations were not sufficient to ensure the observations were accurately completed. Effect: Random moment sampling is based on the laws of probability, which state, in essence, that there is a high probability that a relatively small number of random observations will yield an accurate depiction of the overall characteristics of the population for which the sample was taken. If RMTS observations are not accurate, there is an increased risk costs will be allocated incorrectly between programs. Recommendation: We recommend the Agency improve procedures to ensure that random moment observations are accurate and adequately reviewed. Management Response: The Agency agrees.
Program: AL 12.401 ? National Guard Military Operations and Maintenance (O&M) Projects ? Cash Management & Reporting Grant Number & Year: Appendices ? W91243-20-2-1001, FFY 2020; W91243-21-2-1001, FFY 2021; W91243-21-2-1005, FFY 2021; W91243-21-2-1021, FFY 2021; W91243-22-2-1001, FFY 2022; W91243-22-2-1002, FFY 2022; W91243-22-2-1003, FFY 2022; W91243-22-2-1005, FFY 2022; W91243-22-2-1024, FFY 2022 Federal Grantor Agency: U.S. Department of Defense Criteria: Per 2 CFR ? 1128.100 and 2 CFR ? 1128.200 (January 1, 2022), the Department of Defense adopted the Uniform Administrative Requirements, Cost Principles, and Audit Requirements set forth at 2 CFR parts 200.302, 200.303, and 200.305. Per 2 CFR ? 200.303 (January 1, 2022): 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. Title 2 CFR ? 200.302 (January 1, 2022) requires financial management systems of the State sufficient to permit both the preparation of required reports and the tracing of funds to expenditures adequate to establish that the use of the funds was in accordance with applicable regulations. EnterpriseOne is the official accounting system for the State of Nebraska, and all expenditures are generated from it. Title 2 CFR ? 200.305(a) (January 1, 2022) states, in part, ?For states, payments are governed by Treasury-State Cash Management Improvement Act (CMIA) agreements and default procedures codified at 31 CFR part 205 . . . .? Title 31 CFR Part 205 (July 1, 2021) implements the Cash Management Improvement Act (CMIA) and requires State recipients to enter into agreements that document accepted funding techniques for Federal assistance programs. The CMIA Agreement between the State of Nebraska, Secretary of the Treasury, and U.S. Department of the Treasury, for the period July 1, 2021, through June 30, 2022, allows the program to request Federal funds in accordance with the monthly draw funding technique by which the amount requested shall be based on estimated costs to be incurred in the next month. Master Cooperative Agreement (October 2020), Article V ? Payment, Section 503, Payment by Advance Method, states, ?The advance payment method shall be according to procedures established in current PARC policy, NGR 5-1 Chapter 11 or successor CNGB I & M, and 2 CFR ?200.305.? National Guard Regulation (NGR) 5-1, National Guard Grants and Cooperative Agreements, Section 11-5, Advance Payment Method, Section (5), states in part, ?[T]he grantee agrees to minimize the time elapsing between the transfer of funds from the U.S. Treasury and their disbursement by the State. (no more than 45 days)?. NGR 5-1 was in effect during the entire audit period but has since been superseded by CNGBI 9101.00, which went into effect on January 27, 2023. Instructions for OMB Standard Form 270 (REV. 1/2016) includes the following for line 11a, ?Enter program outlays to date (net of refunds, rebates, and discounts), in the appropriate columns. For requests prepared on a cash basis, outlays are the sum of actual cash disbursements for goods and services, the amount of indirect expenses charged, the value of in- kind contributions applied, and the amount of cash advances and payments made to subcontractors and subrecipients.? A good internal control plan would include procedures to ensure that the time between the drawdown of Federal funds and disbursements are minimized and in compliance with State of Nebraska CMIA Agreement and National Guard Regulations. Condition: The Agency was not in compliance with the Federal cash management requirements during the fiscal year and did not properly report program outlays on the OMB Standard Form (SF) 270. A similar finding was noted in the prior audit. Repeat Finding: 2021-059 Questioned Costs: None Statistical Sample: No Context: We tested 25 drawdowns and noted the following: ? Fourteen drawdowns were not in compliance with NGR 5-1. Ten of the draws were expended from 46 to 334 calendar days after the drawdown of Federal funds. The other four draws had yet to be fully expended as of February 9, 2023. The table below provides a summary of the 14 draws: See Schedule of Findings and Questioned Costs for chart/table. ? In addition, four draws were not in compliance with CMIA Agreement requirements. Advance amounts were requested based on estimated costs to be incurred during the month covered by the requests. To determine the reasonableness of the estimates, the APA determined the time it took the Agency to expend amounts advanced (without consideration of any cash on hand). Four draws were expended between 64 and 110 days after the drawdown of Federal funds. ? For 24 of 25 SF 270?s tested, the Agency did not properly report total program outlays on the OMB SF-270 report. The Military reported the total drawdowns for the program to date, rather than actual cash disbursements, as total program outlays. The variance between what was reported and what should have been reported ranged from an underreporting of $56,356 to an overreporting of $2,310,585, with a net total overreporting of total program outlays by $10,983,232 for the 25 reports tested. Cause: Inadequate procedures for coding funds and estimating cash needs for the upcoming month. The Agency drew down funds from the wrong Federal program. The Agency has recorded expenditures for two capital construction projects dating back to December 2019. The Agency reports expenditures for the projects under the Military Construction program (AL 12.400), stating that the projects are Federally funded under AL 12.400. However, it drew down funds for the projects under AL 12.401. Regarding SF-270 reporting, the Agency thought that the report instructions requiring reporting of actual cash disbursements as total program outlays did not apply to it as an ?advance State? (a State that is authorized to request funds on an advance basis). Effect: The Agency is not in compliance with Federal cash management and reporting requirements, which could result in sanctions. Additionally, there is an increased risk for the loss of Federal funding. Recommendation: We recommend the Agency ensure that the amount of time between the Federal draw and the disbursement of funds by the State is minimized and in compliance with the State of Nebraska CMIA Agreement and National Guard Regulations. We also recommend the Agency report total program outlays in compliance with Federal requirements. Management Response: The United States Property and Fiscal Office (USPFO) concurs with the recommendation.
Program: Various, including AL 10.561 ? State Administrative Matching Grants for the Supplemental Nutrition Assistance Program; AL 93.558 ? Temporary Assistance for Needy Families; AL 93.566 ? Refugee and Entrant Assistance State/Replacement Designee Administered Programs; AL 93.575 ? Child Care and Development Block Grant ? Allowable Costs/Cost Principles Grant Number & Year: Various, including 202121S251443, FFY 2021; 202222S251443, FFY 2022; 1901NETANF, FFY 2019; 2101NERCMA, FFY 2021; 2201NERCMA, FFY 2022; 2201NECCDD, FFY 2022 Federal Grantor Agency: U.S. Department of Agriculture and U.S. Department of Health and Human Services Criteria: 45 CFR ? 75.303 (October 1, 2021) states, in relevant part, the following: 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. 45 CFR ? 75.403 (October 1, 2021) requires costs to be necessary, reasonable, and adequately documented. 45 CFR ? 75.302 (October 1, 2021) requires financial management systems of the State sufficient to permit both preparation of required reports and tracing of funds to expenditures adequate to establish that the use of those funds was in accordance with applicable regulations. 45 CFR ? 75.405(a) (October 1, 2021) states, in part, the following: A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. Per 2 CFR ? 400.1 (January 1, 2022), the U.S. Department of Agriculture adopted the OMB Uniform Guidance as its policies and procedures for uniform administrative requirements, cost principles, and audit requirements for Federal awards. 2 CFR ? 200.303 (January 1, 2022) states, in part, the following: 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. 2 CFR ? 200.403 (January 1, 2022) requires costs to be reasonable, necessary, and adequately documented. 2 CFR ? 200.405(a) (January 1, 2022) states, in part, the following: A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. 45 CFR ? 75.511(b) and 2 CFR ? 200.511(b) (January 1, 2022) state, in relevant part, the following: The summary schedule of prior audit findings must report the status of all audit findings included in the prior audit?s schedule of findings and questioned costs. . . . * * * * (2) When audit findings were not corrected or were only partially corrected, the summary schedule must describe the reasons for the finding?s recurrence and planned corrective action, and any partial corrective action taken. When corrective action taken is significantly different from corrective action previously reported in a corrective action plan or in the Federal agency?s or pass-through entity?s management decision, the summary schedule must provide an explanation. Good internal control requires procedures to ensure that amounts charged to Federal programs are proper. Condition: The Agency did not properly charge Federal programs for seven allocations tested. A similar finding was noted in the prior audit. The Summary Schedule of Prior Audit Findings lists the status as completed. Repeat Finding: 2021-031, 2021-032 Questioned Costs: $44,356 known See Schedule of Findings and Questioned Costs for chart/table. Statistical Sample: No Context: For seven of 14 allocations tested, we noted the following: ? We tested the allocation of cost center 25C21940 Field Office Resource Development for the quarter ended September 30, 2021, which is allocated based on Time & Effort reports. The payroll costs for 85 employees were charged to the cost center; however, four of the employees? payroll costs should not have been charged to the cost center. The four employees tested included a Federal Aid Administrator, a Program Accuracy Specialist, and two Office Specialists. The supervisors they worked with were not charged to this cost center, and the employees were not employed as Resource Developers, which was the job title of most of the employees included in this cost center. As a result of these employees being charged to the Resource Development cost center instead of their appropriate cost centers, Child Care and Development, Foster Care, Adoption Assistance, Guardianship Assistance, and Medicaid were not charged correctly, ranging from undercharges of $2,653 to overcharges of $2,402. Additionally, we were unable to determine how the payroll costs of $9,858 to the Federal Aid Administrator should have been allocated. The Resource Development cost center allocated $1,444,162 for the quarter ended September 30, 2021. A similar finding was noted in the prior audit. ? We tested the allocation of cost center 25C20680 Legal Services General Legal Teams for the quarter ended June 30, 2022, which is allocated based on Time & Effort reports. The payroll costs for a Legislative Coordinator were recorded to this cost center during the quarter. However, these costs should have been recorded to cost center 25C20720 Communications and Legislative Services Administration. As a result, this employee?s payroll costs of $15,777 during the quarter were not allocated to Federal programs correctly. We were unable to determine how these payroll costs should have been allocated. The Legal Services General Legal Teams cost center allocated $1,332,052 for the quarter ended June 30, 2022. ? We tested the allocation of cost center 25C21960 Field Office Social Services Casework for quarter ended September 30, 2021, which is allocated based on random moment time studies (RMTS) results. The Bridges to Independence program and Guardianship Assistance program should have been allocated $1,464 each from this cost center; however, the Agency did not include these programs in the allocation. As a result, the Federal grants for Refugee and Entrant Assistance, Child Care and Development, Foster Care, Adoption Assistance, Temporary Assistance to Needy Families (TANF), Supplemental Nutrition Assistance Program (SNAP), and Medicaid were overcharged, ranging from $3 to $982, and the Guardianship Assistance grant was undercharged $732. The Field Office Social Services Casework cost center allocated $8,099,617 for the quarter ended September 30, 2021. ? We tested the allocation of cost center 25C21920 Field Office Child Protection & Safety Services for the quarter ended June 30, 2022, which is allocated based on RMTS results. The Agency began using a new RMTS system in January 2022; however, the Agency did not set up the quarterly summary reports correctly. Below are the issues noted: o RMTS observations for Trial Home Visits were not included in the allocation. As a result, State programs were undercharged, and Federal programs were overcharged. o The RMTS observations for Child Protection Initial Assessment were not properly allocated. As a result, Foster Care was overcharged, and Adoption and Guardianship were undercharged. o The RMTS observations for Before or After Work Hours were incorrectly included in the State?s allocation. As a result, Federal programs were undercharged. In total, Federal grants for Adoption Assistance, Foster Care, and Guardianship Assistance were undercharged $28,560, $113,762, and $1,990, respectively. The Field Office Child Protection & Safety Services cost center allocated $12,429,881 for the quarter ended June 30, 2022. ? We tested the allocation of cost center 25C21910 Field Office Administration for the quarter ended June 30, 2022, which is allocated based on labor hours. The Agency did not include all of the applicable labor hours for the Medicaid program. As a result, the Federal grants for Adoption Assistance, Foster Care, Guardianship Assistance, Refugee and Entrant Assistance, Child Care and Development, TANF, and SNAP were overcharged, ranging from $265 to $30,556, and the Medicaid grant was undercharged $235,906. The Field Office Administration cost center allocated $3,236,547 for the quarter ended June 30, 2022. ? We tested the allocation of cost center 25C20990 IST Application NFOCUS Applications for the quarter ended September 30, 2021, which is allocated based on client counts per NFOCUS/MMIS reports. We noted that the Foster Care and TANF recipient counts used in the allocation did not agree to support. The Foster Care count included 71 clients that were paid with State funds, resulting in $265 being overcharged to the Foster Care grant, and the TANF count included 48 clients that were paid with State funds, resulting in $358 being overcharged to the TANF grant. Additionally, we were unable to trace the member counts to documentation that supported allocating $1,853,284 to Medicaid and $283,190 to the Children?s Health Insurance Program (CHIP). The Agency did not maintain the member count reports used at the time of the allocation. The Agency was able to generate a historical report; however, while the report amounts were similar, they did not agree with the counts used in the allocation. The Agency did maintain system summary reports at the time of the allocation, and the total counts on the summary reports did agree to amounts used for the allocation. However, as the summary reports used did not maintain the detail of members counted, we could not verify the accuracy of the reports used. The IST Application Services NFOCUS Applications cost center allocated $3,800,340 for the quarter ended September 30, 2021. ? We tested the allocation of cost center 25C23823 iServe IAPD H971 ? Shared for the quarter ending June 30, 2022. The Agency is developing the new iServe Nebraska Portal, which is an application for Nebraskans to apply for benefits from Federal and State programs. This application will be replacing ACCESSNebraska, the current application used by Nebraskans to apply for benefits. For the implementation phase of the project, the Agency was only allocating costs to the following four programs: LIHEAP, TANF, SNAP, and Medicaid. However, there are other Federal and State programs that will utilize the iServe application. We asked for documentation to support that these were the only four programs that were benefiting from this stage of the project. The Agency provided correspondence from its Federal contacts, which stated: ?As long as SNAP, Medicaid, LIHEAP, and TANF are the only benefiting programs for the State?s iServe Nebraska Portal project, the State may just include these four programs in the development of its cost allocation plan. If/when the State decides to add other Federal programs that will benefit from enhancements to the portal, it will need to revisit and adjust its cost allocation plan.? We asked again for documentation, such as internal planning documents, to support that these were the only four programs benefiting from this stage of the project. The Agency replied that it did not have the documentation at this time. The iServe IAPD H971 ? Shared cost center allocated $6,019,121 for the quarter ended June 30, 2022. We were unable to determine questioned costs as we were not able to determine which Federal and State program should receive an allocation, and the basis for how the costs would be allocated to these programs. Cause: Inadequate procedures to ensure that system reports were set up correctly, employees coded their time correctly, and allocations were adequately supported and calculated correctly. Effect: Without adequate documentation to support the allocation of costs, there is increased risk of programs not being charged the proper amounts. Recommendation: We recommend the Agency improve procedures to ensure that employee pay is recorded correctly in E1, system reports are set up correctly, and costs are properly allocated and charged. Management Response: The Agency agrees.
Program: AL 93.558 ? Temporary Assistance to Needy Families; AL 10.561 ? State Administrative Matching Grants for the Supplemental Nutrition Assistance Program; AL 93.658 ? Foster Care Title IV-E ? Allowable Cost/Cost Principles Grant Number & Year: 1901NETANF, FFY 2019; 2101NEFOST, FFY 2021; 2201NEFOST, FFY 2022; 202121S251443, FFY 2021; 202222S251443, FFY 2022 Federal Grantor Agency: U.S. Department of Agriculture and U.S. Department of Health and Human Services Criteria: Per 45 CFR ? 75.303 (October 1, 2021): 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. 45 CFR ? 75.403 (October 1, 2021) requires costs to be reasonable, necessary, and adequately documented. 45 CFR ? 75.405(a) (October 1, 2021) states, in part, the following: A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. Per 2 CFR ? 200.303 (January 1, 2022): The non-Federal entity must: (a) Establish and maintain effective internal control 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. 2 CFR ? 200.403 (January 1, 2022) requires costs to be reasonable, necessary, and adequately documented. 2 CFR ? 200.405(a) (January 1, 2022) states, in part, the following: A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. Per the CAP, ?The RMTS Administrator is an employee of the Division of Children and Family Services and is responsible for . . . . verification that all forms are submitted to the Completed Surveys database, review of the worker entries to validate consistent practice among participants . . . .? Per the CAP, ?Each worker should be trained in the completion of the observation form and to the importance of providing accurate and timely responses.? According to RMTS Explanations: 1. Case Work ? Select this item if you were working on a specific case at the observation time. If you select this item you will be asked to enter the NFOCUS master case number. If there is not an NFOCUS master case, use any other number or description that can be used to identify the case . . . . According to the RMTS Instructions for the Worker: ?After the observation form has been submitted and validated (if selected for validation), it is reviewed by a member of the CFS and Cost Accounting Office for consistency.? According to the RMTS Instructions for the Supervisor: ?If you agree with the worker?s selections, you can click the ?VALIDATION? button. If you do not agree with the worker?s selections, you need to confer with the worker on the selection process and reach agreement on the proper selections for the form. Make updates as needed, and click the ?VALIDATION? button to attach the supervisor?s electronic signature and validate the form.? Good internal control and sound accounting practices require procedures to ensure that staff know how to complete accurate random moment time studies, which are used to allocate costs to Federal programs. Condition: The Agency did not have adequate procedures to ensure the accuracy of the RMTS. A similar finding was noted in the prior audit. Repeat Finding: 2021-033 Questioned Costs: $14,131 known See Schedule of Findings and Questioned Costs for chart/table. Statistical Sample: No Context: The RMTS is conducted on an ongoing basis to provide data for the allocation of direct and indirect costs to various programs. The objective is to identify employee efforts directly related to programs administered by the Agency. We tested 48 validated RMTS observations and noted that inadequate documentation was provided on 11 of them. We noted the following: ? For two of four Foster Care IV-E observations tested, the observations should have been reported as Foster Care Non IV-E per the documentation in the case files. For one of these observations, the case worker noted in the comments that she selected the wrong option. However, it was still validated without correction. ? For five of 21 SNAP observations tested, the RMTS observation form appeared to have been completed incorrectly by the case worker. For two of these observations, the case worker selected the SNAP program; however, per the case files, the case worker appeared to be working on other programs along with SNAP at the time of the observation or was not working on SNAP at all at the time of the observation. As we could not confirm from the documentation on file what the case worker was working on, the questioned costs are unknown. For the other three observations, the case workers did not document which cases they were working on. ? For four of 12 TANF observations tested, the RMTS observation forms appeared to have been completed incorrectly by the case workers. The case workers selected the TANF program; however, per the case files, the case workers appeared to be working on other programs along with TANF at the time of the observation, or, for one case, not working on TANF at all. As we could not confirm from the documentation on file what the case worker was working on, the questioned costs are unknown. Total known Federal payment errors, amount tested, error rate (amount of errors/ amount tested), total dollars charged via RMTS, and potential dollars at risk (dollar rate multiplied by the population total dollars charged) are summarized below by program: See Schedule of Findings and Questioned Costs for chart/table. The APA also inquired with Agency staff to determine if they were provided training in how to complete the random moment time studies. For one individual, the Agency was unable to provide documentation to support that the employee selected had completed RMTS training. Cause: The Agency?s training of staff and supervisory reviews of RMTS observations were not sufficient to ensure the observations were accurately completed. Effect: Random moment sampling is based on the laws of probability, which state, in essence, that there is a high probability that a relatively small number of random observations will yield an accurate depiction of the overall characteristics of the population for which the sample was taken. If RMTS observations are not accurate, there is an increased risk costs will be allocated incorrectly between programs. Recommendation: We recommend the Agency improve procedures to ensure that random moment observations are accurate and adequately reviewed. Management Response: The Agency agrees.
Program: Various, including AL 10.561 ? State Administrative Matching Grants for the Supplemental Nutrition Assistance Program; AL 93.558 ? Temporary Assistance for Needy Families; AL 93.566 ? Refugee and Entrant Assistance State/Replacement Designee Administered Programs; AL 93.575 ? Child Care and Development Block Grant ? Allowable Costs/Cost Principles Grant Number & Year: Various, including 202121S251443, FFY 2021; 202222S251443, FFY 2022; 1901NETANF, FFY 2019; 2101NERCMA, FFY 2021; 2201NERCMA, FFY 2022; 2201NECCDD, FFY 2022 Federal Grantor Agency: U.S. Department of Agriculture and U.S. Department of Health and Human Services Criteria: 45 CFR ? 75.303 (October 1, 2021) states, in relevant part, the following: 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. 45 CFR ? 75.403 (October 1, 2021) requires costs to be necessary, reasonable, and adequately documented. 45 CFR ? 75.302 (October 1, 2021) requires financial management systems of the State sufficient to permit both preparation of required reports and tracing of funds to expenditures adequate to establish that the use of those funds was in accordance with applicable regulations. 45 CFR ? 75.405(a) (October 1, 2021) states, in part, the following: A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. Per 2 CFR ? 400.1 (January 1, 2022), the U.S. Department of Agriculture adopted the OMB Uniform Guidance as its policies and procedures for uniform administrative requirements, cost principles, and audit requirements for Federal awards. 2 CFR ? 200.303 (January 1, 2022) states, in part, the following: 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. 2 CFR ? 200.403 (January 1, 2022) requires costs to be reasonable, necessary, and adequately documented. 2 CFR ? 200.405(a) (January 1, 2022) states, in part, the following: A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. 45 CFR ? 75.511(b) and 2 CFR ? 200.511(b) (January 1, 2022) state, in relevant part, the following: The summary schedule of prior audit findings must report the status of all audit findings included in the prior audit?s schedule of findings and questioned costs. . . . * * * * (2) When audit findings were not corrected or were only partially corrected, the summary schedule must describe the reasons for the finding?s recurrence and planned corrective action, and any partial corrective action taken. When corrective action taken is significantly different from corrective action previously reported in a corrective action plan or in the Federal agency?s or pass-through entity?s management decision, the summary schedule must provide an explanation. Good internal control requires procedures to ensure that amounts charged to Federal programs are proper. Condition: The Agency did not properly charge Federal programs for seven allocations tested. A similar finding was noted in the prior audit. The Summary Schedule of Prior Audit Findings lists the status as completed. Repeat Finding: 2021-031, 2021-032 Questioned Costs: $44,356 known See Schedule of Findings and Questioned Costs for chart/table. Statistical Sample: No Context: For seven of 14 allocations tested, we noted the following: ? We tested the allocation of cost center 25C21940 Field Office Resource Development for the quarter ended September 30, 2021, which is allocated based on Time & Effort reports. The payroll costs for 85 employees were charged to the cost center; however, four of the employees? payroll costs should not have been charged to the cost center. The four employees tested included a Federal Aid Administrator, a Program Accuracy Specialist, and two Office Specialists. The supervisors they worked with were not charged to this cost center, and the employees were not employed as Resource Developers, which was the job title of most of the employees included in this cost center. As a result of these employees being charged to the Resource Development cost center instead of their appropriate cost centers, Child Care and Development, Foster Care, Adoption Assistance, Guardianship Assistance, and Medicaid were not charged correctly, ranging from undercharges of $2,653 to overcharges of $2,402. Additionally, we were unable to determine how the payroll costs of $9,858 to the Federal Aid Administrator should have been allocated. The Resource Development cost center allocated $1,444,162 for the quarter ended September 30, 2021. A similar finding was noted in the prior audit. ? We tested the allocation of cost center 25C20680 Legal Services General Legal Teams for the quarter ended June 30, 2022, which is allocated based on Time & Effort reports. The payroll costs for a Legislative Coordinator were recorded to this cost center during the quarter. However, these costs should have been recorded to cost center 25C20720 Communications and Legislative Services Administration. As a result, this employee?s payroll costs of $15,777 during the quarter were not allocated to Federal programs correctly. We were unable to determine how these payroll costs should have been allocated. The Legal Services General Legal Teams cost center allocated $1,332,052 for the quarter ended June 30, 2022. ? We tested the allocation of cost center 25C21960 Field Office Social Services Casework for quarter ended September 30, 2021, which is allocated based on random moment time studies (RMTS) results. The Bridges to Independence program and Guardianship Assistance program should have been allocated $1,464 each from this cost center; however, the Agency did not include these programs in the allocation. As a result, the Federal grants for Refugee and Entrant Assistance, Child Care and Development, Foster Care, Adoption Assistance, Temporary Assistance to Needy Families (TANF), Supplemental Nutrition Assistance Program (SNAP), and Medicaid were overcharged, ranging from $3 to $982, and the Guardianship Assistance grant was undercharged $732. The Field Office Social Services Casework cost center allocated $8,099,617 for the quarter ended September 30, 2021. ? We tested the allocation of cost center 25C21920 Field Office Child Protection & Safety Services for the quarter ended June 30, 2022, which is allocated based on RMTS results. The Agency began using a new RMTS system in January 2022; however, the Agency did not set up the quarterly summary reports correctly. Below are the issues noted: o RMTS observations for Trial Home Visits were not included in the allocation. As a result, State programs were undercharged, and Federal programs were overcharged. o The RMTS observations for Child Protection Initial Assessment were not properly allocated. As a result, Foster Care was overcharged, and Adoption and Guardianship were undercharged. o The RMTS observations for Before or After Work Hours were incorrectly included in the State?s allocation. As a result, Federal programs were undercharged. In total, Federal grants for Adoption Assistance, Foster Care, and Guardianship Assistance were undercharged $28,560, $113,762, and $1,990, respectively. The Field Office Child Protection & Safety Services cost center allocated $12,429,881 for the quarter ended June 30, 2022. ? We tested the allocation of cost center 25C21910 Field Office Administration for the quarter ended June 30, 2022, which is allocated based on labor hours. The Agency did not include all of the applicable labor hours for the Medicaid program. As a result, the Federal grants for Adoption Assistance, Foster Care, Guardianship Assistance, Refugee and Entrant Assistance, Child Care and Development, TANF, and SNAP were overcharged, ranging from $265 to $30,556, and the Medicaid grant was undercharged $235,906. The Field Office Administration cost center allocated $3,236,547 for the quarter ended June 30, 2022. ? We tested the allocation of cost center 25C20990 IST Application NFOCUS Applications for the quarter ended September 30, 2021, which is allocated based on client counts per NFOCUS/MMIS reports. We noted that the Foster Care and TANF recipient counts used in the allocation did not agree to support. The Foster Care count included 71 clients that were paid with State funds, resulting in $265 being overcharged to the Foster Care grant, and the TANF count included 48 clients that were paid with State funds, resulting in $358 being overcharged to the TANF grant. Additionally, we were unable to trace the member counts to documentation that supported allocating $1,853,284 to Medicaid and $283,190 to the Children?s Health Insurance Program (CHIP). The Agency did not maintain the member count reports used at the time of the allocation. The Agency was able to generate a historical report; however, while the report amounts were similar, they did not agree with the counts used in the allocation. The Agency did maintain system summary reports at the time of the allocation, and the total counts on the summary reports did agree to amounts used for the allocation. However, as the summary reports used did not maintain the detail of members counted, we could not verify the accuracy of the reports used. The IST Application Services NFOCUS Applications cost center allocated $3,800,340 for the quarter ended September 30, 2021. ? We tested the allocation of cost center 25C23823 iServe IAPD H971 ? Shared for the quarter ending June 30, 2022. The Agency is developing the new iServe Nebraska Portal, which is an application for Nebraskans to apply for benefits from Federal and State programs. This application will be replacing ACCESSNebraska, the current application used by Nebraskans to apply for benefits. For the implementation phase of the project, the Agency was only allocating costs to the following four programs: LIHEAP, TANF, SNAP, and Medicaid. However, there are other Federal and State programs that will utilize the iServe application. We asked for documentation to support that these were the only four programs that were benefiting from this stage of the project. The Agency provided correspondence from its Federal contacts, which stated: ?As long as SNAP, Medicaid, LIHEAP, and TANF are the only benefiting programs for the State?s iServe Nebraska Portal project, the State may just include these four programs in the development of its cost allocation plan. If/when the State decides to add other Federal programs that will benefit from enhancements to the portal, it will need to revisit and adjust its cost allocation plan.? We asked again for documentation, such as internal planning documents, to support that these were the only four programs benefiting from this stage of the project. The Agency replied that it did not have the documentation at this time. The iServe IAPD H971 ? Shared cost center allocated $6,019,121 for the quarter ended June 30, 2022. We were unable to determine questioned costs as we were not able to determine which Federal and State program should receive an allocation, and the basis for how the costs would be allocated to these programs. Cause: Inadequate procedures to ensure that system reports were set up correctly, employees coded their time correctly, and allocations were adequately supported and calculated correctly. Effect: Without adequate documentation to support the allocation of costs, there is increased risk of programs not being charged the proper amounts. Recommendation: We recommend the Agency improve procedures to ensure that employee pay is recorded correctly in E1, system reports are set up correctly, and costs are properly allocated and charged. Management Response: The Agency agrees.
Program: Various, including AL 10.561 ? State Administrative Matching Grants for the Supplemental Nutrition Assistance Program; AL 93.558 ? Temporary Assistance for Needy Families; AL 93.566 ? Refugee and Entrant Assistance State/Replacement Designee Administered Programs; AL 93.575 ? Child Care and Development Block Grant ? Allowable Costs/Cost Principles Grant Number & Year: Various, including 202121S251443, FFY 2021; 202222S251443, FFY 2022; 1901NETANF, FFY 2019; 2101NERCMA, FFY 2021; 2201NERCMA, FFY 2022; 2201NECCDD, FFY 2022 Federal Grantor Agency: U.S. Department of Agriculture and U.S. Department of Health and Human Services Criteria: 45 CFR ? 75.303 (October 1, 2021) states, in relevant part, the following: 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. 45 CFR ? 75.403 (October 1, 2021) requires costs to be necessary, reasonable, and adequately documented. 45 CFR ? 75.302 (October 1, 2021) requires financial management systems of the State sufficient to permit both preparation of required reports and tracing of funds to expenditures adequate to establish that the use of those funds was in accordance with applicable regulations. 45 CFR ? 75.405(a) (October 1, 2021) states, in part, the following: A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. Per 2 CFR ? 400.1 (January 1, 2022), the U.S. Department of Agriculture adopted the OMB Uniform Guidance as its policies and procedures for uniform administrative requirements, cost principles, and audit requirements for Federal awards. 2 CFR ? 200.303 (January 1, 2022) states, in part, the following: 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. 2 CFR ? 200.403 (January 1, 2022) requires costs to be reasonable, necessary, and adequately documented. 2 CFR ? 200.405(a) (January 1, 2022) states, in part, the following: A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. 45 CFR ? 75.511(b) and 2 CFR ? 200.511(b) (January 1, 2022) state, in relevant part, the following: The summary schedule of prior audit findings must report the status of all audit findings included in the prior audit?s schedule of findings and questioned costs. . . . * * * * (2) When audit findings were not corrected or were only partially corrected, the summary schedule must describe the reasons for the finding?s recurrence and planned corrective action, and any partial corrective action taken. When corrective action taken is significantly different from corrective action previously reported in a corrective action plan or in the Federal agency?s or pass-through entity?s management decision, the summary schedule must provide an explanation. Good internal control requires procedures to ensure that amounts charged to Federal programs are proper. Condition: The Agency did not properly charge Federal programs for seven allocations tested. A similar finding was noted in the prior audit. The Summary Schedule of Prior Audit Findings lists the status as completed. Repeat Finding: 2021-031, 2021-032 Questioned Costs: $44,356 known See Schedule of Findings and Questioned Costs for chart/table. Statistical Sample: No Context: For seven of 14 allocations tested, we noted the following: ? We tested the allocation of cost center 25C21940 Field Office Resource Development for the quarter ended September 30, 2021, which is allocated based on Time & Effort reports. The payroll costs for 85 employees were charged to the cost center; however, four of the employees? payroll costs should not have been charged to the cost center. The four employees tested included a Federal Aid Administrator, a Program Accuracy Specialist, and two Office Specialists. The supervisors they worked with were not charged to this cost center, and the employees were not employed as Resource Developers, which was the job title of most of the employees included in this cost center. As a result of these employees being charged to the Resource Development cost center instead of their appropriate cost centers, Child Care and Development, Foster Care, Adoption Assistance, Guardianship Assistance, and Medicaid were not charged correctly, ranging from undercharges of $2,653 to overcharges of $2,402. Additionally, we were unable to determine how the payroll costs of $9,858 to the Federal Aid Administrator should have been allocated. The Resource Development cost center allocated $1,444,162 for the quarter ended September 30, 2021. A similar finding was noted in the prior audit. ? We tested the allocation of cost center 25C20680 Legal Services General Legal Teams for the quarter ended June 30, 2022, which is allocated based on Time & Effort reports. The payroll costs for a Legislative Coordinator were recorded to this cost center during the quarter. However, these costs should have been recorded to cost center 25C20720 Communications and Legislative Services Administration. As a result, this employee?s payroll costs of $15,777 during the quarter were not allocated to Federal programs correctly. We were unable to determine how these payroll costs should have been allocated. The Legal Services General Legal Teams cost center allocated $1,332,052 for the quarter ended June 30, 2022. ? We tested the allocation of cost center 25C21960 Field Office Social Services Casework for quarter ended September 30, 2021, which is allocated based on random moment time studies (RMTS) results. The Bridges to Independence program and Guardianship Assistance program should have been allocated $1,464 each from this cost center; however, the Agency did not include these programs in the allocation. As a result, the Federal grants for Refugee and Entrant Assistance, Child Care and Development, Foster Care, Adoption Assistance, Temporary Assistance to Needy Families (TANF), Supplemental Nutrition Assistance Program (SNAP), and Medicaid were overcharged, ranging from $3 to $982, and the Guardianship Assistance grant was undercharged $732. The Field Office Social Services Casework cost center allocated $8,099,617 for the quarter ended September 30, 2021. ? We tested the allocation of cost center 25C21920 Field Office Child Protection & Safety Services for the quarter ended June 30, 2022, which is allocated based on RMTS results. The Agency began using a new RMTS system in January 2022; however, the Agency did not set up the quarterly summary reports correctly. Below are the issues noted: o RMTS observations for Trial Home Visits were not included in the allocation. As a result, State programs were undercharged, and Federal programs were overcharged. o The RMTS observations for Child Protection Initial Assessment were not properly allocated. As a result, Foster Care was overcharged, and Adoption and Guardianship were undercharged. o The RMTS observations for Before or After Work Hours were incorrectly included in the State?s allocation. As a result, Federal programs were undercharged. In total, Federal grants for Adoption Assistance, Foster Care, and Guardianship Assistance were undercharged $28,560, $113,762, and $1,990, respectively. The Field Office Child Protection & Safety Services cost center allocated $12,429,881 for the quarter ended June 30, 2022. ? We tested the allocation of cost center 25C21910 Field Office Administration for the quarter ended June 30, 2022, which is allocated based on labor hours. The Agency did not include all of the applicable labor hours for the Medicaid program. As a result, the Federal grants for Adoption Assistance, Foster Care, Guardianship Assistance, Refugee and Entrant Assistance, Child Care and Development, TANF, and SNAP were overcharged, ranging from $265 to $30,556, and the Medicaid grant was undercharged $235,906. The Field Office Administration cost center allocated $3,236,547 for the quarter ended June 30, 2022. ? We tested the allocation of cost center 25C20990 IST Application NFOCUS Applications for the quarter ended September 30, 2021, which is allocated based on client counts per NFOCUS/MMIS reports. We noted that the Foster Care and TANF recipient counts used in the allocation did not agree to support. The Foster Care count included 71 clients that were paid with State funds, resulting in $265 being overcharged to the Foster Care grant, and the TANF count included 48 clients that were paid with State funds, resulting in $358 being overcharged to the TANF grant. Additionally, we were unable to trace the member counts to documentation that supported allocating $1,853,284 to Medicaid and $283,190 to the Children?s Health Insurance Program (CHIP). The Agency did not maintain the member count reports used at the time of the allocation. The Agency was able to generate a historical report; however, while the report amounts were similar, they did not agree with the counts used in the allocation. The Agency did maintain system summary reports at the time of the allocation, and the total counts on the summary reports did agree to amounts used for the allocation. However, as the summary reports used did not maintain the detail of members counted, we could not verify the accuracy of the reports used. The IST Application Services NFOCUS Applications cost center allocated $3,800,340 for the quarter ended September 30, 2021. ? We tested the allocation of cost center 25C23823 iServe IAPD H971 ? Shared for the quarter ending June 30, 2022. The Agency is developing the new iServe Nebraska Portal, which is an application for Nebraskans to apply for benefits from Federal and State programs. This application will be replacing ACCESSNebraska, the current application used by Nebraskans to apply for benefits. For the implementation phase of the project, the Agency was only allocating costs to the following four programs: LIHEAP, TANF, SNAP, and Medicaid. However, there are other Federal and State programs that will utilize the iServe application. We asked for documentation to support that these were the only four programs that were benefiting from this stage of the project. The Agency provided correspondence from its Federal contacts, which stated: ?As long as SNAP, Medicaid, LIHEAP, and TANF are the only benefiting programs for the State?s iServe Nebraska Portal project, the State may just include these four programs in the development of its cost allocation plan. If/when the State decides to add other Federal programs that will benefit from enhancements to the portal, it will need to revisit and adjust its cost allocation plan.? We asked again for documentation, such as internal planning documents, to support that these were the only four programs benefiting from this stage of the project. The Agency replied that it did not have the documentation at this time. The iServe IAPD H971 ? Shared cost center allocated $6,019,121 for the quarter ended June 30, 2022. We were unable to determine questioned costs as we were not able to determine which Federal and State program should receive an allocation, and the basis for how the costs would be allocated to these programs. Cause: Inadequate procedures to ensure that system reports were set up correctly, employees coded their time correctly, and allocations were adequately supported and calculated correctly. Effect: Without adequate documentation to support the allocation of costs, there is increased risk of programs not being charged the proper amounts. Recommendation: We recommend the Agency improve procedures to ensure that employee pay is recorded correctly in E1, system reports are set up correctly, and costs are properly allocated and charged. Management Response: The Agency agrees.
Program: AL 93.558 ? Temporary Assistance to Needy Families; AL 10.561 ? State Administrative Matching Grants for the Supplemental Nutrition Assistance Program; AL 93.658 ? Foster Care Title IV-E ? Allowable Cost/Cost Principles Grant Number & Year: 1901NETANF, FFY 2019; 2101NEFOST, FFY 2021; 2201NEFOST, FFY 2022; 202121S251443, FFY 2021; 202222S251443, FFY 2022 Federal Grantor Agency: U.S. Department of Agriculture and U.S. Department of Health and Human Services Criteria: Per 45 CFR ? 75.303 (October 1, 2021): 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. 45 CFR ? 75.403 (October 1, 2021) requires costs to be reasonable, necessary, and adequately documented. 45 CFR ? 75.405(a) (October 1, 2021) states, in part, the following: A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. Per 2 CFR ? 200.303 (January 1, 2022): The non-Federal entity must: (a) Establish and maintain effective internal control 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. 2 CFR ? 200.403 (January 1, 2022) requires costs to be reasonable, necessary, and adequately documented. 2 CFR ? 200.405(a) (January 1, 2022) states, in part, the following: A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. Per the CAP, ?The RMTS Administrator is an employee of the Division of Children and Family Services and is responsible for . . . . verification that all forms are submitted to the Completed Surveys database, review of the worker entries to validate consistent practice among participants . . . .? Per the CAP, ?Each worker should be trained in the completion of the observation form and to the importance of providing accurate and timely responses.? According to RMTS Explanations: 1. Case Work ? Select this item if you were working on a specific case at the observation time. If you select this item you will be asked to enter the NFOCUS master case number. If there is not an NFOCUS master case, use any other number or description that can be used to identify the case . . . . According to the RMTS Instructions for the Worker: ?After the observation form has been submitted and validated (if selected for validation), it is reviewed by a member of the CFS and Cost Accounting Office for consistency.? According to the RMTS Instructions for the Supervisor: ?If you agree with the worker?s selections, you can click the ?VALIDATION? button. If you do not agree with the worker?s selections, you need to confer with the worker on the selection process and reach agreement on the proper selections for the form. Make updates as needed, and click the ?VALIDATION? button to attach the supervisor?s electronic signature and validate the form.? Good internal control and sound accounting practices require procedures to ensure that staff know how to complete accurate random moment time studies, which are used to allocate costs to Federal programs. Condition: The Agency did not have adequate procedures to ensure the accuracy of the RMTS. A similar finding was noted in the prior audit. Repeat Finding: 2021-033 Questioned Costs: $14,131 known See Schedule of Findings and Questioned Costs for chart/table. Statistical Sample: No Context: The RMTS is conducted on an ongoing basis to provide data for the allocation of direct and indirect costs to various programs. The objective is to identify employee efforts directly related to programs administered by the Agency. We tested 48 validated RMTS observations and noted that inadequate documentation was provided on 11 of them. We noted the following: ? For two of four Foster Care IV-E observations tested, the observations should have been reported as Foster Care Non IV-E per the documentation in the case files. For one of these observations, the case worker noted in the comments that she selected the wrong option. However, it was still validated without correction. ? For five of 21 SNAP observations tested, the RMTS observation form appeared to have been completed incorrectly by the case worker. For two of these observations, the case worker selected the SNAP program; however, per the case files, the case worker appeared to be working on other programs along with SNAP at the time of the observation or was not working on SNAP at all at the time of the observation. As we could not confirm from the documentation on file what the case worker was working on, the questioned costs are unknown. For the other three observations, the case workers did not document which cases they were working on. ? For four of 12 TANF observations tested, the RMTS observation forms appeared to have been completed incorrectly by the case workers. The case workers selected the TANF program; however, per the case files, the case workers appeared to be working on other programs along with TANF at the time of the observation, or, for one case, not working on TANF at all. As we could not confirm from the documentation on file what the case worker was working on, the questioned costs are unknown. Total known Federal payment errors, amount tested, error rate (amount of errors/ amount tested), total dollars charged via RMTS, and potential dollars at risk (dollar rate multiplied by the population total dollars charged) are summarized below by program: See Schedule of Findings and Questioned Costs for chart/table. The APA also inquired with Agency staff to determine if they were provided training in how to complete the random moment time studies. For one individual, the Agency was unable to provide documentation to support that the employee selected had completed RMTS training. Cause: The Agency?s training of staff and supervisory reviews of RMTS observations were not sufficient to ensure the observations were accurately completed. Effect: Random moment sampling is based on the laws of probability, which state, in essence, that there is a high probability that a relatively small number of random observations will yield an accurate depiction of the overall characteristics of the population for which the sample was taken. If RMTS observations are not accurate, there is an increased risk costs will be allocated incorrectly between programs. Recommendation: We recommend the Agency improve procedures to ensure that random moment observations are accurate and adequately reviewed. Management Response: The Agency agrees.
Program: AL 17.225 ? Unemployment Insurance ? Admin ? Special Tests & Provisions Grant Number & Year: UI-35660-21-55-A-31, FFY 2021; UI-37235-22-55-A-31, FFY 2022 Federal Grantor Agency: U.S. Department of Labor Criteria: Per 2 CFR ? 2900.4 (January 1, 2022), the U.S. Department of Labor adopted the OMB Uniform Guidance as its policies and procedures for financial assistance administration. Per 2 CFR ? 200.303(a) (January 1, 2022), the non-Federal entity must do the following: 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 Committed of Sponsoring Organizations of the Treadway Commission (COSO). Good internal controls require procedures to ensure that amounts owed are adequately tracked. Condition: We were not able to reconcile the subsidiary employer accounts with the State?s Unemployment Insurance (UI) general ledger control accounts. Repeat Finding: No Questioned Costs: None Statistical Sample: No Context: The Agency maintains accounts, or subsidiary ledgers, on State UI taxes received or due from individual employers and the UI Benefits charged to the employer. The Agency previously used the Tax Management System (TMS) to track employer accounts up to November 2021. Starting in December 2021, the Agency switched to the Geographic Solutions Unemployment System (GUS). The compliance supplement requires the auditor to reconcile, on a test basis, the subsidiary employer accounts with the State?s UI general ledger control accounts. Per the State?s Accounting system (EnterpriseOne), the Tax Contribution, Interest, and Penalties Receivable accounts were $3,587,459, $653,964, and $174,901. Only a report of the total Tax Contribution Receivables per the GUS system was provided, and the total per this report did not agree to the total Tax Contribution Receivables per EnterpriseOne. Therefore, we were unable to determine if the receivable amount in EnterpriseOne agreed to GUS, and we were unable to reconcile those subsidiary employer accounts with the State?s UI general ledger control accounts that had interest and/or penalties due. Cause: The Agency did not create a report for the total balance owed by employer when the new UI tax system was implemented. Effect: When there are not procedures to track amounts owed, there is an increased risk that amounts owed will not be collected. Recommendation: We recommend the Agency work with its vendor for the UI tax system to implement reports to track the amounts owed by employer. Management Response: The UI tax system currently tracks the amounts owed by individual employers and issues an ETA 581 report which lists aggregated employer liability data on quarterly basis. That aggregated data can be reviewed within the UI tax system on an employer, by employer basis. The Agency recognizes a desire for the Tax System to provide a specific report that can be run at any time and provide Tax Contribution Receivables. NDOL is working with the software vendor to provide additional employer liability reporting capabilities.
Program: AL 21.023 ? COVID-19 Emergency Rental Assistance ? Allowability & Eligibility Grant Number & Year: N/A Federal Grantor Agency: U.S. Department of the Treasury Criteria: Per 2 CFR ? 1000.10 (January 1, 2022), the U.S. Department of the Treasury adopted the Uniform Administrative Requirements, Cost Principles, and Audit Requirements set forth at 2 CFR part 200. 2 CFR ? 200.303 (January 1, 2022) states, in relevant part, the following: 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. . . . Good internal controls require risk assessments to be performed, and procedures to verify the validity of applicants prior to payment. 2 CFR ? 200.403 (January 1, 2022) states, in part: Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. * * * * (g) Be adequately documented. The Nebraska ERA Program FAQ states, ?Who is eligible? You are eligible if you answer YES to ALL of the following: . . .Your landlord is not an immediate family member.? Division N ? Additional Coronavirus Response and Relief, Title V ? Banking, Section 501(k)(3)(A) of the Consolidated Appropriations Act, 2021, states that an eligible household is a household of one or more individuals that is obligated to pay rent on a residential dwelling. Good internal controls require procedures to verify the validity of applicants prior to payment. Condition: Procedures were not adequate to ensure that payments were allowable, and individuals were eligible for assistance. A similar finding was noted in the prior audit. Repeat Finding: 2021-064 Questioned Costs: $76,050 known Statistical Sample: No Context: During testing of 40 aid payments, we noted one payment, totaling $1,350, made to an applicant whose landlord was an immediate relative. The total sample tested was $87,526, and total assistance payments for the fiscal year were $17,456,087. The dollar error rate for the sample was 1.54% ($1,350/$87,526), which estimates the potential dollars at risk for fiscal year 2022 to be $268,824 (dollar rate multiplied by the population.) In the prior and current audit, we noted that the Agency identified likely fraudulent payments. As of January 9, 2023, the Agency had identified $155,360 and $822,188 of likely fraudulent payments in fiscal years ended June 30, 2021, and June 30, 2022, respectively. We reviewed five of these payments, totaling $74,700, in fiscal year 2022. For all five payments, we noted indicators of possible fraud, as information on the application provided was inconsistent with the information from other databases or systems. Examples of such indicators include the following: 1) the owner of the property per the County Assessors website not agreeing to the owner listed on the application; 2) generic and editable supporting documentation; and 3) tenants and landlords having out-of-state identification and telephone numbers. According to the Agency, these payments have been referred to the State Patrol for further investigation. Cause: The Agency had various procedures for ensuring that application information was accurate; however, verifying the property owner to County Assessor information was not required. Effect: There is an increased risk for fraudulent payments. Once fraudulent payments have been made, the likelihood of recouping them is low. Recommendation: We recommend the Agency improve its procedures for verifying the validity of applicants prior to payments. We further recommend the Agency continue to work with law enforcement to recoup improper payments. Management Response: The Military Department does not agree with this finding. The State has implemented a strong system of internal controls to determine program eligibility. These controls include detailed pre-payment and post-payment analytics to help identify applications at risk for fraud. As the ERA program progressed in Nebraska and nationally, program procedures continued to be enhanced to monitor for and prevent potentially fraudulent applications. During its life the program provided proactive fraud detection for over 56,000 tenant and landlord applications and prevented approximately $23M of funding from being paid out erroneously. Additionally, the State turns over any paid applications that have been subsequently determined at risk of being fraudulent to the State Patrol for further investigation and potential prosecution. APA Response: In addition to the one of 40 payments tested with errors, five payments we reviewed noted possible indications of fraud. Once fraudulent payments have been made, the likelihood of recouping them is low. 2 CFR ? 200.516 (January 1, 2022) requires reporting known or likely fraud affecting a Federal award.
Program: AL 21.026 ? COVID-19 Homeowner Assistance Fund ? Allowability & Eligibility Grant Number & Year: N/A Federal Grantor Agency: U.S. Department of the Treasury Criteria: Per 2 CFR ? 1000.10 (January 1, 2022), the U.S. Department of the Treasury adopted the Uniform Administrative Requirements, Cost Principles, and Audit Requirements set forth at 2 CFR part 200. U.S. Department of the Treasury Homeowner Assistance Fund Guidance states the following, in relevant part: HAF participants must have a reasonable basis under the circumstances for determining income for purposes of the requirements described above under ?Eligible Homeowners.? Two approaches for income verification are permissible: (1) the household may provide a written attestation as to household income together with supporting documentation?or (2) the household may provide a written attestation as to household income and the HAF participant may use a reasonable fact-specific proxy for household income, such as reliance on data regarding average incomes in the household?s geographic area. The Financial Assistance Agreement states that Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, as set out in 2 C.F.R. Part 200, are applicable to the award. Per 2 CFR ? 200.303 (January 1, 2022): 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. Good internal control requires procedures to ensure that participants are eligible and payments are proper. Condition: The Agency did not have adequate procedures to ensure that payments were allowable, and participants were eligible for assistance. Repeat Finding: No Questioned Costs: $981 known Statistical Sample: No Context: We tested 25 assistance payments. One $981 payment tested did not include the co-applicant. The applicant noted his marital status as married; however, the application was signed only by one individual, and the income verification review was performed only for the applicant and did not include the income of the spouse. The total sample tested was $116,341, and total assistance payments for the fiscal year were $5,015,888. Based on the sample tested, the case error rate was 4% (1/25). The dollar error rate for the sample was 0.84% ($981/$116,341), which estimates the potential dollars at risk for fiscal year 2022 to be $42,133 (dollar rate multiplied by the population.) Cause: Staff errors and inadequate review. Effect: Increased risk for errors or fraud. Recommendation: We recommend the Agency improve procedures for ensuring that applications are properly completed and reviewed, and eligibility requirements are met. Management Response: The Military Department agrees with this finding. Management agrees the spouse should have been added to the application, income verification completed for the spouse, and no letter of explanation was provided for excluding the spouse. However, adding the spouse?s name and income would not have changed the award decision.
2022 ? 005: Reporting Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553/10.555/10.559 Federal Award Identification Number and Year: Not Available - FY2020-21 and FY 2021-2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: SY 2020-21, SY 2021-2022 Award Period: July 1, 2020 to June 30, 2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: 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). . . ." Condition and Context: During the process of obtaining an understanding of internal controls related to the requirements of recordkeeping, we noted that the School Corporation failed to have a documented internal control to mitigate the risk of noncompliance with the stated criteria related to record-keeping. Questioned costs: None Cause: The School Corporation failed to maintain documentation of established internal controls to mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Effect: The lack of an established system of internal control related to recordkeeping could result in noncompliance with the stated criteria. Repeat Finding: No Recommendation: We recommend that the School Corporation update its policies and procedures related to the administration of the Child Nutrition Cluster to include a system of internal control that will mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 005: Reporting Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553/10.555/10.559 Federal Award Identification Number and Year: Not Available - FY2020-21 and FY 2021-2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: SY 2020-21, SY 2021-2022 Award Period: July 1, 2020 to June 30, 2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: 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). . . ." Condition and Context: During the process of obtaining an understanding of internal controls related to the requirements of recordkeeping, we noted that the School Corporation failed to have a documented internal control to mitigate the risk of noncompliance with the stated criteria related to record-keeping. Questioned costs: None Cause: The School Corporation failed to maintain documentation of established internal controls to mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Effect: The lack of an established system of internal control related to recordkeeping could result in noncompliance with the stated criteria. Repeat Finding: No Recommendation: We recommend that the School Corporation update its policies and procedures related to the administration of the Child Nutrition Cluster to include a system of internal control that will mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 005: Reporting Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553/10.555/10.559 Federal Award Identification Number and Year: Not Available - FY2020-21 and FY 2021-2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: SY 2020-21, SY 2021-2022 Award Period: July 1, 2020 to June 30, 2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: 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). . . ." Condition and Context: During the process of obtaining an understanding of internal controls related to the requirements of recordkeeping, we noted that the School Corporation failed to have a documented internal control to mitigate the risk of noncompliance with the stated criteria related to record-keeping. Questioned costs: None Cause: The School Corporation failed to maintain documentation of established internal controls to mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Effect: The lack of an established system of internal control related to recordkeeping could result in noncompliance with the stated criteria. Repeat Finding: No Recommendation: We recommend that the School Corporation update its policies and procedures related to the administration of the Child Nutrition Cluster to include a system of internal control that will mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 005: Reporting Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553/10.555/10.559 Federal Award Identification Number and Year: Not Available - FY2020-21 and FY 2021-2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: SY 2020-21, SY 2021-2022 Award Period: July 1, 2020 to June 30, 2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: 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). . . ." Condition and Context: During the process of obtaining an understanding of internal controls related to the requirements of recordkeeping, we noted that the School Corporation failed to have a documented internal control to mitigate the risk of noncompliance with the stated criteria related to record-keeping. Questioned costs: None Cause: The School Corporation failed to maintain documentation of established internal controls to mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Effect: The lack of an established system of internal control related to recordkeeping could result in noncompliance with the stated criteria. Repeat Finding: No Recommendation: We recommend that the School Corporation update its policies and procedures related to the administration of the Child Nutrition Cluster to include a system of internal control that will mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 005: Reporting Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553/10.555/10.559 Federal Award Identification Number and Year: Not Available - FY2020-21 and FY 2021-2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: SY 2020-21, SY 2021-2022 Award Period: July 1, 2020 to June 30, 2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: 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). . . ." Condition and Context: During the process of obtaining an understanding of internal controls related to the requirements of recordkeeping, we noted that the School Corporation failed to have a documented internal control to mitigate the risk of noncompliance with the stated criteria related to record-keeping. Questioned costs: None Cause: The School Corporation failed to maintain documentation of established internal controls to mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Effect: The lack of an established system of internal control related to recordkeeping could result in noncompliance with the stated criteria. Repeat Finding: No Recommendation: We recommend that the School Corporation update its policies and procedures related to the administration of the Child Nutrition Cluster to include a system of internal control that will mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 005: Reporting Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553/10.555/10.559 Federal Award Identification Number and Year: Not Available - FY2020-21 and FY 2021-2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: SY 2020-21, SY 2021-2022 Award Period: July 1, 2020 to June 30, 2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: 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). . . ." Condition and Context: During the process of obtaining an understanding of internal controls related to the requirements of recordkeeping, we noted that the School Corporation failed to have a documented internal control to mitigate the risk of noncompliance with the stated criteria related to record-keeping. Questioned costs: None Cause: The School Corporation failed to maintain documentation of established internal controls to mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Effect: The lack of an established system of internal control related to recordkeeping could result in noncompliance with the stated criteria. Repeat Finding: No Recommendation: We recommend that the School Corporation update its policies and procedures related to the administration of the Child Nutrition Cluster to include a system of internal control that will mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 005: Reporting Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553/10.555/10.559 Federal Award Identification Number and Year: Not Available - FY2020-21 and FY 2021-2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: SY 2020-21, SY 2021-2022 Award Period: July 1, 2020 to June 30, 2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: 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). . . ." Condition and Context: During the process of obtaining an understanding of internal controls related to the requirements of recordkeeping, we noted that the School Corporation failed to have a documented internal control to mitigate the risk of noncompliance with the stated criteria related to record-keeping. Questioned costs: None Cause: The School Corporation failed to maintain documentation of established internal controls to mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Effect: The lack of an established system of internal control related to recordkeeping could result in noncompliance with the stated criteria. Repeat Finding: No Recommendation: We recommend that the School Corporation update its policies and procedures related to the administration of the Child Nutrition Cluster to include a system of internal control that will mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 005: Reporting Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553/10.555/10.559 Federal Award Identification Number and Year: Not Available - FY2020-21 and FY 2021-2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: SY 2020-21, SY 2021-2022 Award Period: July 1, 2020 to June 30, 2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: 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). . . ." Condition and Context: During the process of obtaining an understanding of internal controls related to the requirements of recordkeeping, we noted that the School Corporation failed to have a documented internal control to mitigate the risk of noncompliance with the stated criteria related to record-keeping. Questioned costs: None Cause: The School Corporation failed to maintain documentation of established internal controls to mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Effect: The lack of an established system of internal control related to recordkeeping could result in noncompliance with the stated criteria. Repeat Finding: No Recommendation: We recommend that the School Corporation update its policies and procedures related to the administration of the Child Nutrition Cluster to include a system of internal control that will mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 005: Reporting Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553/10.555/10.559 Federal Award Identification Number and Year: Not Available - FY2020-21 and FY 2021-2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: SY 2020-21, SY 2021-2022 Award Period: July 1, 2020 to June 30, 2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: 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). . . ." Condition and Context: During the process of obtaining an understanding of internal controls related to the requirements of recordkeeping, we noted that the School Corporation failed to have a documented internal control to mitigate the risk of noncompliance with the stated criteria related to record-keeping. Questioned costs: None Cause: The School Corporation failed to maintain documentation of established internal controls to mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Effect: The lack of an established system of internal control related to recordkeeping could result in noncompliance with the stated criteria. Repeat Finding: No Recommendation: We recommend that the School Corporation update its policies and procedures related to the administration of the Child Nutrition Cluster to include a system of internal control that will mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 005: Reporting Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553/10.555/10.559 Federal Award Identification Number and Year: Not Available - FY2020-21 and FY 2021-2022 Pass-Through Agency: Indiana Department of Education Pass-Through Numbers: SY 2020-21, SY 2021-2022 Award Period: July 1, 2020 to June 30, 2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: 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). . . ." Condition and Context: During the process of obtaining an understanding of internal controls related to the requirements of recordkeeping, we noted that the School Corporation failed to have a documented internal control to mitigate the risk of noncompliance with the stated criteria related to record-keeping. Questioned costs: None Cause: The School Corporation failed to maintain documentation of established internal controls to mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Effect: The lack of an established system of internal control related to recordkeeping could result in noncompliance with the stated criteria. Repeat Finding: No Recommendation: We recommend that the School Corporation update its policies and procedures related to the administration of the Child Nutrition Cluster to include a system of internal control that will mitigate the risk of noncompliance with the stated criteria related to recordkeeping. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 004: Allowable Costs/Costs Principles Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Numbers: 84.027/84.173 Federal Award Identification Number and Year: H027A180084 - FY2019, FY2020, FY2021; H173A190104 - FY2019, FY2020, FY2021 Pass-Through Agency: Indiana Department of Education Pass-Through Number(s): H027A180084; H173A190104 Award Period: FY2019, FY2020, FY2021 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matters Criteria or specific requirement: 2 CFR 200.303 states in part: "The non-Federal entity must: 1. 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 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: 1. Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. 2. Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. . . . (g) Be adequately documented. . . ." Condition: During the process of obtaining an understanding of internal controls and processing of payroll expenditures and testing payroll expenditures, we noted that the School Corporation failed to maintain documentation in accordance with the time and effort requirements. Questioned costs: The noted exceptions in the context of this finding had $90 of known payroll costs charged to the Program. Context: We selected sixty transactions for payroll disbursement testing. We noted that wages charged to the program for two of the sixty items tested did not include time and effort documentation for payroll expense charged to the grants. Cause: Salary figures were charged to the federal grant that did not have time and effort documentation for amount charged. Effect: The organization has not fully followed compliance attributes with the allowable costs principles set forth by the Compliance Supplement related to allocation of salaries being charged based on approved time worked for a program and other expenses being adequately documented to support the details of the expense charged to the grant. Personnel need to reinforce policies to ensure control procedures are in place to ensure salaries charged to a grant are appropriately based on approved time worked in a program and expenses charged to the grant are adequately supported. Repeat Finding: No Recommendation: We recommend the organization charge compensation for personnel services to the federal grant based on approved hours worked in the program. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 004: Allowable Costs/Costs Principles Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Numbers: 84.027/84.173 Federal Award Identification Number and Year: H027A180084 - FY2019, FY2020, FY2021; H173A190104 - FY2019, FY2020, FY2021 Pass-Through Agency: Indiana Department of Education Pass-Through Number(s): H027A180084; H173A190104 Award Period: FY2019, FY2020, FY2021 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matters Criteria or specific requirement: 2 CFR 200.303 states in part: "The non-Federal entity must: 1. 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 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: 1. Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. 2. Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. . . . (g) Be adequately documented. . . ." Condition: During the process of obtaining an understanding of internal controls and processing of payroll expenditures and testing payroll expenditures, we noted that the School Corporation failed to maintain documentation in accordance with the time and effort requirements. Questioned costs: The noted exceptions in the context of this finding had $90 of known payroll costs charged to the Program. Context: We selected sixty transactions for payroll disbursement testing. We noted that wages charged to the program for two of the sixty items tested did not include time and effort documentation for payroll expense charged to the grants. Cause: Salary figures were charged to the federal grant that did not have time and effort documentation for amount charged. Effect: The organization has not fully followed compliance attributes with the allowable costs principles set forth by the Compliance Supplement related to allocation of salaries being charged based on approved time worked for a program and other expenses being adequately documented to support the details of the expense charged to the grant. Personnel need to reinforce policies to ensure control procedures are in place to ensure salaries charged to a grant are appropriately based on approved time worked in a program and expenses charged to the grant are adequately supported. Repeat Finding: No Recommendation: We recommend the organization charge compensation for personnel services to the federal grant based on approved hours worked in the program. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 004: Allowable Costs/Costs Principles Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Numbers: 84.027/84.173 Federal Award Identification Number and Year: H027A180084 - FY2019, FY2020, FY2021; H173A190104 - FY2019, FY2020, FY2021 Pass-Through Agency: Indiana Department of Education Pass-Through Number(s): H027A180084; H173A190104 Award Period: FY2019, FY2020, FY2021 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matters Criteria or specific requirement: 2 CFR 200.303 states in part: "The non-Federal entity must: 1. 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 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: 1. Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. 2. Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. . . . (g) Be adequately documented. . . ." Condition: During the process of obtaining an understanding of internal controls and processing of payroll expenditures and testing payroll expenditures, we noted that the School Corporation failed to maintain documentation in accordance with the time and effort requirements. Questioned costs: The noted exceptions in the context of this finding had $90 of known payroll costs charged to the Program. Context: We selected sixty transactions for payroll disbursement testing. We noted that wages charged to the program for two of the sixty items tested did not include time and effort documentation for payroll expense charged to the grants. Cause: Salary figures were charged to the federal grant that did not have time and effort documentation for amount charged. Effect: The organization has not fully followed compliance attributes with the allowable costs principles set forth by the Compliance Supplement related to allocation of salaries being charged based on approved time worked for a program and other expenses being adequately documented to support the details of the expense charged to the grant. Personnel need to reinforce policies to ensure control procedures are in place to ensure salaries charged to a grant are appropriately based on approved time worked in a program and expenses charged to the grant are adequately supported. Repeat Finding: No Recommendation: We recommend the organization charge compensation for personnel services to the federal grant based on approved hours worked in the program. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 004: Allowable Costs/Costs Principles Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Numbers: 84.027/84.173 Federal Award Identification Number and Year: H027A180084 - FY2019, FY2020, FY2021; H173A190104 - FY2019, FY2020, FY2021 Pass-Through Agency: Indiana Department of Education Pass-Through Number(s): H027A180084; H173A190104 Award Period: FY2019, FY2020, FY2021 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matters Criteria or specific requirement: 2 CFR 200.303 states in part: "The non-Federal entity must: 1. 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 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: 1. Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. 2. Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. . . . (g) Be adequately documented. . . ." Condition: During the process of obtaining an understanding of internal controls and processing of payroll expenditures and testing payroll expenditures, we noted that the School Corporation failed to maintain documentation in accordance with the time and effort requirements. Questioned costs: The noted exceptions in the context of this finding had $90 of known payroll costs charged to the Program. Context: We selected sixty transactions for payroll disbursement testing. We noted that wages charged to the program for two of the sixty items tested did not include time and effort documentation for payroll expense charged to the grants. Cause: Salary figures were charged to the federal grant that did not have time and effort documentation for amount charged. Effect: The organization has not fully followed compliance attributes with the allowable costs principles set forth by the Compliance Supplement related to allocation of salaries being charged based on approved time worked for a program and other expenses being adequately documented to support the details of the expense charged to the grant. Personnel need to reinforce policies to ensure control procedures are in place to ensure salaries charged to a grant are appropriately based on approved time worked in a program and expenses charged to the grant are adequately supported. Repeat Finding: No Recommendation: We recommend the organization charge compensation for personnel services to the federal grant based on approved hours worked in the program. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 004: Allowable Costs/Costs Principles Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Numbers: 84.027/84.173 Federal Award Identification Number and Year: H027A180084 - FY2019, FY2020, FY2021; H173A190104 - FY2019, FY2020, FY2021 Pass-Through Agency: Indiana Department of Education Pass-Through Number(s): H027A180084; H173A190104 Award Period: FY2019, FY2020, FY2021 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matters Criteria or specific requirement: 2 CFR 200.303 states in part: "The non-Federal entity must: 1. 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 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: 1. Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. 2. Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. . . . (g) Be adequately documented. . . ." Condition: During the process of obtaining an understanding of internal controls and processing of payroll expenditures and testing payroll expenditures, we noted that the School Corporation failed to maintain documentation in accordance with the time and effort requirements. Questioned costs: The noted exceptions in the context of this finding had $90 of known payroll costs charged to the Program. Context: We selected sixty transactions for payroll disbursement testing. We noted that wages charged to the program for two of the sixty items tested did not include time and effort documentation for payroll expense charged to the grants. Cause: Salary figures were charged to the federal grant that did not have time and effort documentation for amount charged. Effect: The organization has not fully followed compliance attributes with the allowable costs principles set forth by the Compliance Supplement related to allocation of salaries being charged based on approved time worked for a program and other expenses being adequately documented to support the details of the expense charged to the grant. Personnel need to reinforce policies to ensure control procedures are in place to ensure salaries charged to a grant are appropriately based on approved time worked in a program and expenses charged to the grant are adequately supported. Repeat Finding: No Recommendation: We recommend the organization charge compensation for personnel services to the federal grant based on approved hours worked in the program. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 004: Allowable Costs/Costs Principles Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Numbers: 84.027/84.173 Federal Award Identification Number and Year: H027A180084 - FY2019, FY2020, FY2021; H173A190104 - FY2019, FY2020, FY2021 Pass-Through Agency: Indiana Department of Education Pass-Through Number(s): H027A180084; H173A190104 Award Period: FY2019, FY2020, FY2021 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matters Criteria or specific requirement: 2 CFR 200.303 states in part: "The non-Federal entity must: 1. 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 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: 1. Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. 2. Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. . . . (g) Be adequately documented. . . ." Condition: During the process of obtaining an understanding of internal controls and processing of payroll expenditures and testing payroll expenditures, we noted that the School Corporation failed to maintain documentation in accordance with the time and effort requirements. Questioned costs: The noted exceptions in the context of this finding had $90 of known payroll costs charged to the Program. Context: We selected sixty transactions for payroll disbursement testing. We noted that wages charged to the program for two of the sixty items tested did not include time and effort documentation for payroll expense charged to the grants. Cause: Salary figures were charged to the federal grant that did not have time and effort documentation for amount charged. Effect: The organization has not fully followed compliance attributes with the allowable costs principles set forth by the Compliance Supplement related to allocation of salaries being charged based on approved time worked for a program and other expenses being adequately documented to support the details of the expense charged to the grant. Personnel need to reinforce policies to ensure control procedures are in place to ensure salaries charged to a grant are appropriately based on approved time worked in a program and expenses charged to the grant are adequately supported. Repeat Finding: No Recommendation: We recommend the organization charge compensation for personnel services to the federal grant based on approved hours worked in the program. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 004: Allowable Costs/Costs Principles Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Numbers: 84.027/84.173 Federal Award Identification Number and Year: H027A180084 - FY2019, FY2020, FY2021; H173A190104 - FY2019, FY2020, FY2021 Pass-Through Agency: Indiana Department of Education Pass-Through Number(s): H027A180084; H173A190104 Award Period: FY2019, FY2020, FY2021 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matters Criteria or specific requirement: 2 CFR 200.303 states in part: "The non-Federal entity must: 1. 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 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: 1. Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. 2. Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. . . . (g) Be adequately documented. . . ." Condition: During the process of obtaining an understanding of internal controls and processing of payroll expenditures and testing payroll expenditures, we noted that the School Corporation failed to maintain documentation in accordance with the time and effort requirements. Questioned costs: The noted exceptions in the context of this finding had $90 of known payroll costs charged to the Program. Context: We selected sixty transactions for payroll disbursement testing. We noted that wages charged to the program for two of the sixty items tested did not include time and effort documentation for payroll expense charged to the grants. Cause: Salary figures were charged to the federal grant that did not have time and effort documentation for amount charged. Effect: The organization has not fully followed compliance attributes with the allowable costs principles set forth by the Compliance Supplement related to allocation of salaries being charged based on approved time worked for a program and other expenses being adequately documented to support the details of the expense charged to the grant. Personnel need to reinforce policies to ensure control procedures are in place to ensure salaries charged to a grant are appropriately based on approved time worked in a program and expenses charged to the grant are adequately supported. Repeat Finding: No Recommendation: We recommend the organization charge compensation for personnel services to the federal grant based on approved hours worked in the program. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 004: Allowable Costs/Costs Principles Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Numbers: 84.027/84.173 Federal Award Identification Number and Year: H027A180084 - FY2019, FY2020, FY2021; H173A190104 - FY2019, FY2020, FY2021 Pass-Through Agency: Indiana Department of Education Pass-Through Number(s): H027A180084; H173A190104 Award Period: FY2019, FY2020, FY2021 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matters Criteria or specific requirement: 2 CFR 200.303 states in part: "The non-Federal entity must: 1. 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 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: 1. Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. 2. Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. . . . (g) Be adequately documented. . . ." Condition: During the process of obtaining an understanding of internal controls and processing of payroll expenditures and testing payroll expenditures, we noted that the School Corporation failed to maintain documentation in accordance with the time and effort requirements. Questioned costs: The noted exceptions in the context of this finding had $90 of known payroll costs charged to the Program. Context: We selected sixty transactions for payroll disbursement testing. We noted that wages charged to the program for two of the sixty items tested did not include time and effort documentation for payroll expense charged to the grants. Cause: Salary figures were charged to the federal grant that did not have time and effort documentation for amount charged. Effect: The organization has not fully followed compliance attributes with the allowable costs principles set forth by the Compliance Supplement related to allocation of salaries being charged based on approved time worked for a program and other expenses being adequately documented to support the details of the expense charged to the grant. Personnel need to reinforce policies to ensure control procedures are in place to ensure salaries charged to a grant are appropriately based on approved time worked in a program and expenses charged to the grant are adequately supported. Repeat Finding: No Recommendation: We recommend the organization charge compensation for personnel services to the federal grant based on approved hours worked in the program. Views of responsible officials: There is no disagreement with the audit finding.
2022 ? 004: Allowable Costs/Costs Principles Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Numbers: 84.027/84.173 Federal Award Identification Number and Year: H027A180084 - FY2019, FY2020, FY2021; H173A190104 - FY2019, FY2020, FY2021 Pass-Through Agency: Indiana Department of Education Pass-Through Number(s): H027A180084; H173A190104 Award Period: FY2019, FY2020, FY2021 Type of Finding: ? Significant Deficiency in Internal Control over Compliance ? Other Matters Criteria or specific requirement: 2 CFR 200.303 states in part: "The non-Federal entity must: 1. 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 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: 1. Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. 2. Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. . . . (g) Be adequately documented. . . ." Condition: During the process of obtaining an understanding of internal controls and processing of payroll expenditures and testing payroll expenditures, we noted that the School Corporation failed to maintain documentation in accordance with the time and effort requirements. Questioned costs: The noted exceptions in the context of this finding had $90 of known payroll costs charged to the Program. Context: We selected sixty transactions for payroll disbursement testing. We noted that wages charged to the program for two of the sixty items tested did not include time and effort documentation for payroll expense charged to the grants. Cause: Salary figures were charged to the federal grant that did not have time and effort documentation for amount charged. Effect: The organization has not fully followed compliance attributes with the allowable costs principles set forth by the Compliance Supplement related to allocation of salaries being charged based on approved time worked for a program and other expenses being adequately documented to support the details of the expense charged to the grant. Personnel need to reinforce policies to ensure control procedures are in place to ensure salaries charged to a grant are appropriately based on approved time worked in a program and expenses charged to the grant are adequately supported. Repeat Finding: No Recommendation: We recommend the organization charge compensation for personnel services to the federal grant based on approved hours worked in the program. Views of responsible officials: There is no disagreement with the audit finding.