Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
Finding 2022-002: EquipmentFederal ProgramResearch and Development Cluster (R&D) (AL No.: Various)Federal AgenciesAgencies included within the R&D clusterFederal Award YearJuly 1, 2021 through June 30, 2022Criteria or RequirementNon-federal entities other than states must follow 2 CFR sections 200.313(c) through (e) which require that:1. Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)).2. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years (2 CFR section 200.313(d)(2)).4. A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated (2 CFR section 200.313(d)(3)). 5. Adequate maintenance procedures must be developed to keep the property in good condition (2 CFR section 200.313(d)(4))Per 2 CFR Section 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition Found, Including PerspectiveThe University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Possible Cause and EffectThe control that equipment purchased on federal grants is counted, and reconciled to property records, within a two-year period was not operating effectively. Further, the control regarding tagging and identifying equipment to the University?s property records was not operating effectively.Questioned CostsNone identified.Statistical ValidityThe sample was not intended to be, and was not, a statistically valid sample.Repeat Finding in the Prior YearNo.RecommendationWe recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations, and completing the necessary physical inventories and reconciliations.Views of Responsible OfficialsThe University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.
2022-002 Department of Health and Human ServicesFederal Financial Assistance Listing #93.498COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural DistributionApplicable Federal Award Number and Year ? Period 2 and Period 3 TIN #711018775Activities Allowed or Unallowed and Allowable Costs/Cost PrinciplesMaterial Weakness in Internal Control Over ComplianceReportingMaterial Weakness in Internal Control Over Compliance and Material NoncomplianceCriteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal controlover the federal award that provides assurance that the Organization is managing the federal award incompliance with federal statutes, regulations, and conditions of the federal award. The Organization selectedoption iii to calculate lost revenue, the alternative method, which consists of a comparison of actual results withvarious modifications during the period of availability to actual results in 2019, the year prior to the Pandemic.Condition: There was a lack of review and approval over Period 2 Provider Relief Funds lost revenue calculationand reporting. For Period 2 and Period 3, the Organization?s lost revenue calculation did not take intoconsideration applicable audit adjustments for fiscal years 2021 and 2022. In addition, the Period 2 lost revenueon the Special Report to HHS did not agree to the supporting documentation.Cause: The Organization did not have an internal control process in place to ensure review and approval of thelost revenue calculation claimed under the federal program and the report submitted to the Department ofHealth and Human Services (HHS) for Period 2. In addition, without the inclusion of the audit adjustments, therevenue included in the Period 2 and Period 3 was not materially correct.Effect: The lost revenue reported within the special report submitted to the Department of Health and HumanServices for Period 2 and Period 3 was overstated by $1,040,821 and $1,442,473, respectively when consideringthe audit adjustments by quarter.Questioned Costs: None reported. Lost revenues supported was in excess of the amounts received.Context/Sampling: Key line items were tested on the Period 2 and 3 HHS report. Four out of eight key lines hadvariances for Period 2 and six out of ten key lines had variances for Period 3.Repeat Finding from Prior Years: No Recommendation: We recommend that the Organization implement procedures to ensure the lost revenuecalculation claimed agrees to the supporting documentation, includes consideration of audit adjustments byquarter, and includes a secondary review and approval of the calculation.Views of Responsible Officials: Management agrees with the finding.
2022-002 Department of Health and Human ServicesFederal Financial Assistance Listing #93.498COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural DistributionApplicable Federal Award Number and Year ? Period 2 and Period 3 TIN #711018775Activities Allowed or Unallowed and Allowable Costs/Cost PrinciplesMaterial Weakness in Internal Control Over ComplianceReportingMaterial Weakness in Internal Control Over Compliance and Material NoncomplianceCriteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal controlover the federal award that provides assurance that the Organization is managing the federal award incompliance with federal statutes, regulations, and conditions of the federal award. The Organization selectedoption iii to calculate lost revenue, the alternative method, which consists of a comparison of actual results withvarious modifications during the period of availability to actual results in 2019, the year prior to the Pandemic.Condition: There was a lack of review and approval over Period 2 Provider Relief Funds lost revenue calculationand reporting. For Period 2 and Period 3, the Organization?s lost revenue calculation did not take intoconsideration applicable audit adjustments for fiscal years 2021 and 2022. In addition, the Period 2 lost revenueon the Special Report to HHS did not agree to the supporting documentation.Cause: The Organization did not have an internal control process in place to ensure review and approval of thelost revenue calculation claimed under the federal program and the report submitted to the Department ofHealth and Human Services (HHS) for Period 2. In addition, without the inclusion of the audit adjustments, therevenue included in the Period 2 and Period 3 was not materially correct.Effect: The lost revenue reported within the special report submitted to the Department of Health and HumanServices for Period 2 and Period 3 was overstated by $1,040,821 and $1,442,473, respectively when consideringthe audit adjustments by quarter.Questioned Costs: None reported. Lost revenues supported was in excess of the amounts received.Context/Sampling: Key line items were tested on the Period 2 and 3 HHS report. Four out of eight key lines hadvariances for Period 2 and six out of ten key lines had variances for Period 3.Repeat Finding from Prior Years: No Recommendation: We recommend that the Organization implement procedures to ensure the lost revenuecalculation claimed agrees to the supporting documentation, includes consideration of audit adjustments byquarter, and includes a secondary review and approval of the calculation.Views of Responsible Officials: Management agrees with the finding.
2022-001 Accounting System, Processes and Reporting Identification as a Repeat Finding: Repeat of Finding 2021-001Finding:Internal control processes over financial accounting did not ensure that all transactions were properly recorded in accordance with U.S. GAAP on a timely basis.Criteria:The Urban League is responsible for day-to-day transactional accounting as well as annual financial statement reporting. As such, the Organization is responsible for implementing adequate procedures to ensure that such information and reports are accurate and complete.Uniform Guidance Section 2 CFR 200.303(a), Internal Controls, requires that non-federal entities must establish and maintain effective internal controls over the federal award that provides reasonable assurance that the non-federal entity is managing the award in compliance with federal statutes, regulations and the terms and conditions of the federal award.Sample Size and Population:Sampling was not applicable to this finding.Condition and Context:The Organization experienced turnover in its accounting and finance department at the beginning of the fiscal year. In the midst of the transition in staffing, historic knowledge of accounting for certain transactions was lost and reconciliations prepared did not use accurate accounting records and lacked clerical accuracy.Effect:Interim financial statements utilized by the Board of Directors for decision making in FY2022 did not accurately reflect the financial condition of the Organization on a U.S. GAAP basis. The Organization?s internal controls failed to identify material errors in accounting including the following:? 18 months of operating activities were recorded within the consolidating Partnership?s accounting records for the 12 month period ended June 30, 2022.? $704,017 in advanced payments of federal funds that were received in the year ended June 30, 2021 were recognized as revenue during that year and were not appropriately reflected as refundable advances as of that date as disclosed in Note 20 of the financial statements.? Material adjustments were identified in the Organization?s accounting for restricted revenue and net assets with donor restrictions.? The Organization's accounting for a fiscal sponsor relationship did not appropriately reflect accounting for such relationships under ASC 958, Not-For-Profit Entities.Cause:The errors identified in the Partnership?s accounting records reflect errors in the design of reconciliations. The errors in accounting for advanced payments of federal funds reflect documentation retention matters addressed in Finding 2021-006. Additionally, the errors in accounting for advanced payments, restricted revenue, and fiscal sponsor relationships reflect errors in identifying the accounting treatment for contract terms.Recommendations:? Perform analytics of financial data at least quarterly to identify unusual activity that may indicate errors in accounting.? Establish a process for reviewing contract terms and evaluating, communicating, and documenting the appropriate accounting treatment.? Obtain training on ASC 958, Not-for-Profit Entities.? Engage a third-party CPA to review accounting reconciliations on a quarterly basis.Questioned Costs: NoneManagement Response and Corrective Action Plan: See Corrective Action PlanContact Person: Mansour Camara, CFO
2022-001 Accounting System, Processes and Reporting Identification as a Repeat Finding: Repeat of Finding 2021-001Finding:Internal control processes over financial accounting did not ensure that all transactions were properly recorded in accordance with U.S. GAAP on a timely basis.Criteria:The Urban League is responsible for day-to-day transactional accounting as well as annual financial statement reporting. As such, the Organization is responsible for implementing adequate procedures to ensure that such information and reports are accurate and complete.Uniform Guidance Section 2 CFR 200.303(a), Internal Controls, requires that non-federal entities must establish and maintain effective internal controls over the federal award that provides reasonable assurance that the non-federal entity is managing the award in compliance with federal statutes, regulations and the terms and conditions of the federal award.Sample Size and Population:Sampling was not applicable to this finding.Condition and Context:The Organization experienced turnover in its accounting and finance department at the beginning of the fiscal year. In the midst of the transition in staffing, historic knowledge of accounting for certain transactions was lost and reconciliations prepared did not use accurate accounting records and lacked clerical accuracy.Effect:Interim financial statements utilized by the Board of Directors for decision making in FY2022 did not accurately reflect the financial condition of the Organization on a U.S. GAAP basis. The Organization?s internal controls failed to identify material errors in accounting including the following:? 18 months of operating activities were recorded within the consolidating Partnership?s accounting records for the 12 month period ended June 30, 2022.? $704,017 in advanced payments of federal funds that were received in the year ended June 30, 2021 were recognized as revenue during that year and were not appropriately reflected as refundable advances as of that date as disclosed in Note 20 of the financial statements.? Material adjustments were identified in the Organization?s accounting for restricted revenue and net assets with donor restrictions.? The Organization's accounting for a fiscal sponsor relationship did not appropriately reflect accounting for such relationships under ASC 958, Not-For-Profit Entities.Cause:The errors identified in the Partnership?s accounting records reflect errors in the design of reconciliations. The errors in accounting for advanced payments of federal funds reflect documentation retention matters addressed in Finding 2021-006. Additionally, the errors in accounting for advanced payments, restricted revenue, and fiscal sponsor relationships reflect errors in identifying the accounting treatment for contract terms.Recommendations:? Perform analytics of financial data at least quarterly to identify unusual activity that may indicate errors in accounting.? Establish a process for reviewing contract terms and evaluating, communicating, and documenting the appropriate accounting treatment.? Obtain training on ASC 958, Not-for-Profit Entities.? Engage a third-party CPA to review accounting reconciliations on a quarterly basis.Questioned Costs: NoneManagement Response and Corrective Action Plan: See Corrective Action PlanContact Person: Mansour Camara, CFO
2022-002 Department of Health and Human Services, Passed Through Substance Abuse andMental Health Services Administration,Section 223 Demonstration Programs to Improve Community Mental Health ServicesListing 93.829, H79SM085287, 8/31/2021 ? 8/30/2022Procurement, Suspension and DebarmentMaterial Weakness in Internal Control over ComplianceCriteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effectiveinternal control over the federal award the provides assurance that the entity ismanaging the federal award in compliance with federal statutes, regulations andconditions of the federal award. 2 CFR 200.318(c)(1) provides that the auditee mustmaintain written standards of conduct covering conflicts of interest and governing theactions of its employees engaged in the selection, award, and administration ofcontracts. 2 CFR 200.319(c) establishes that the auditee must have written proceduresfor procurement transactions.As outlined in 2 CFR 180, recipients must not utilize any vendor which is suspended ordebarred or is otherwise excluded from the central contractor registry.Condition: Hope?s formally documented policy did not include many of the necessary procurementprovisions. Expenditures under the federal grants did not have a consistent control inplace to check applicable vendors for potential suspension and/or debarment for coveredtransactions. Current controls are not documented to provide for a proper audit trail.Cause: Hope does not have a consistent procurement process in place including all federalrequirements or to check vendors under covered transactions ($25,000 or more) inaccordance with federal regulations.Effect: Hope could be out of compliance with federal requirements when entering intoprocurement contracts as well as not meeting suspension and debarment requirementsby potentially contracting with a suspended or debarred vendor.Questioned costs: None reported.Context: Procurement requirements were applicable to 2 transactions, both of which wereselected for testing and were in excess of the micro-purchase threshold but were not inexcess of $250,000. Suspension and Debarment requirements were applicable to bothtransactions tested.Repeat FindingFrom Prior Year: No Recommendation: The policy should be updated to include all federal requirements for procurement.Further, control procedures should be implemented to ensure that all vendors undercovered transactions are checked against the federal website for vendors that could besuspended or debarred prior to transacting with such vendors, or another process asallowed by the federal regulations discussed above. We also suggest that managementretain documentation to support that the control process was followed.Views ofResponsible Officials: We agree with the finding.
2022-003 Department of Health and Human Services, Passed Through Substance Abuse andMental Health Services Administration,Section 223 Demonstration Programs to Improve Community Mental Health ServicesListing 93.829, H79SM085287, 8/31/2021 ? 8/30/2022Allowable Activities or Unallowed, Allowable Costs/Cost Principles and Cash ManagementMaterial Weakness in Internal Control over Compliance and Material NoncomplianceCriteria: Per Uniform Guidance (2 CFR Section 200.403) as it relates to federal grants: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;b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items;c) Be consistent with policies and procedures that apply uniformly to both federally financed and other activities of the non-Federal entity;d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost;e) Be determined in accordance with generally accepted accounting principles (GAAP), except, for state and local governments and Indian tribes only, as otherwise provided for in this part;f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federally-financed program in either the current or a prior period;g) Be adequately documented;h) Cost must be incurred during the approved budget period. Per the grant policy manual for Department of Health and Human Services: Non-federal entities must minimize the time elapsing between any advance payment under this award and the disbursement of the funds for direct program costs.2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award.Condition: Hope could not readily provide the appropriate documentation for grant expenditures to support the drawdown from grant funding. Additionally, one of the items submitted for reimbursement under the grant, was not an allowable activity or cost in fiscal year 2022 as it was not in accordance with accounting treatment under GAAP.Hope did not adequately minimize the time between draw down of program funds and disbursement.Cause: The process used to ensure that grant expenditures are allowable and reconciled was not clearly communicated to appropriate parties. As a result, certain expenditures were inappropriately claimed in the wrong fiscal year. These expenditures were not made in a reasonable time in relation to receipt of program reimbursements.Effect: Hope is at risk for noncompliance with allowable activities and allowable costs, as well as cash management requirements.Questioned costs: $54,158 was claimed for reimbursement in the current year that did not relate to the fiscal year. Further, grant receipts of $54,158 were received in June 2022 but not disbursed until April 2023.Context: A nonstatistical sampling of 40 out of 702 total transactions were selected for testing, which accounted for $134,724 of $1,021,571 total program expenditures.Repeat FindingFrom Prior Year: NoRecommendation: Controls should be put in place to ensure that direct expenditures of program funds are reviewed and approved by program management and are consistent with the grant reimbursements for those expenditures. Such reconciliations can be done monthly, quarterly, or annually, at Hope?s discretion. Controls should also ensure that program expenditures are made prior to requesting reimbursement of funds and are allowable in accordance with the federal program requirements.Views ofResponsible Officials: We agree with the finding.
2022-003 Department of Health and Human Services, Passed Through Substance Abuse andMental Health Services Administration,Section 223 Demonstration Programs to Improve Community Mental Health ServicesListing 93.829, H79SM085287, 8/31/2021 ? 8/30/2022Allowable Activities or Unallowed, Allowable Costs/Cost Principles and Cash ManagementMaterial Weakness in Internal Control over Compliance and Material NoncomplianceCriteria: Per Uniform Guidance (2 CFR Section 200.403) as it relates to federal grants: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;b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items;c) Be consistent with policies and procedures that apply uniformly to both federally financed and other activities of the non-Federal entity;d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost;e) Be determined in accordance with generally accepted accounting principles (GAAP), except, for state and local governments and Indian tribes only, as otherwise provided for in this part;f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federally-financed program in either the current or a prior period;g) Be adequately documented;h) Cost must be incurred during the approved budget period. Per the grant policy manual for Department of Health and Human Services: Non-federal entities must minimize the time elapsing between any advance payment under this award and the disbursement of the funds for direct program costs.2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award.Condition: Hope could not readily provide the appropriate documentation for grant expenditures to support the drawdown from grant funding. Additionally, one of the items submitted for reimbursement under the grant, was not an allowable activity or cost in fiscal year 2022 as it was not in accordance with accounting treatment under GAAP.Hope did not adequately minimize the time between draw down of program funds and disbursement.Cause: The process used to ensure that grant expenditures are allowable and reconciled was not clearly communicated to appropriate parties. As a result, certain expenditures were inappropriately claimed in the wrong fiscal year. These expenditures were not made in a reasonable time in relation to receipt of program reimbursements.Effect: Hope is at risk for noncompliance with allowable activities and allowable costs, as well as cash management requirements.Questioned costs: $54,158 was claimed for reimbursement in the current year that did not relate to the fiscal year. Further, grant receipts of $54,158 were received in June 2022 but not disbursed until April 2023.Context: A nonstatistical sampling of 40 out of 702 total transactions were selected for testing, which accounted for $134,724 of $1,021,571 total program expenditures.Repeat FindingFrom Prior Year: NoRecommendation: Controls should be put in place to ensure that direct expenditures of program funds are reviewed and approved by program management and are consistent with the grant reimbursements for those expenditures. Such reconciliations can be done monthly, quarterly, or annually, at Hope?s discretion. Controls should also ensure that program expenditures are made prior to requesting reimbursement of funds and are allowable in accordance with the federal program requirements.Views ofResponsible Officials: We agree with the finding.
2022-003 Department of Health and Human Services, Passed Through Substance Abuse andMental Health Services Administration,Section 223 Demonstration Programs to Improve Community Mental Health ServicesListing 93.829, H79SM085287, 8/31/2021 ? 8/30/2022Allowable Activities or Unallowed, Allowable Costs/Cost Principles and Cash ManagementMaterial Weakness in Internal Control over Compliance and Material NoncomplianceCriteria: Per Uniform Guidance (2 CFR Section 200.403) as it relates to federal grants: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;b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items;c) Be consistent with policies and procedures that apply uniformly to both federally financed and other activities of the non-Federal entity;d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost;e) Be determined in accordance with generally accepted accounting principles (GAAP), except, for state and local governments and Indian tribes only, as otherwise provided for in this part;f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federally-financed program in either the current or a prior period;g) Be adequately documented;h) Cost must be incurred during the approved budget period. Per the grant policy manual for Department of Health and Human Services: Non-federal entities must minimize the time elapsing between any advance payment under this award and the disbursement of the funds for direct program costs.2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award.Condition: Hope could not readily provide the appropriate documentation for grant expenditures to support the drawdown from grant funding. Additionally, one of the items submitted for reimbursement under the grant, was not an allowable activity or cost in fiscal year 2022 as it was not in accordance with accounting treatment under GAAP.Hope did not adequately minimize the time between draw down of program funds and disbursement.Cause: The process used to ensure that grant expenditures are allowable and reconciled was not clearly communicated to appropriate parties. As a result, certain expenditures were inappropriately claimed in the wrong fiscal year. These expenditures were not made in a reasonable time in relation to receipt of program reimbursements.Effect: Hope is at risk for noncompliance with allowable activities and allowable costs, as well as cash management requirements.Questioned costs: $54,158 was claimed for reimbursement in the current year that did not relate to the fiscal year. Further, grant receipts of $54,158 were received in June 2022 but not disbursed until April 2023.Context: A nonstatistical sampling of 40 out of 702 total transactions were selected for testing, which accounted for $134,724 of $1,021,571 total program expenditures.Repeat FindingFrom Prior Year: NoRecommendation: Controls should be put in place to ensure that direct expenditures of program funds are reviewed and approved by program management and are consistent with the grant reimbursements for those expenditures. Such reconciliations can be done monthly, quarterly, or annually, at Hope?s discretion. Controls should also ensure that program expenditures are made prior to requesting reimbursement of funds and are allowable in accordance with the federal program requirements.Views ofResponsible Officials: We agree with the finding.
FINDING 2022-003Subject: Child Nutrition Cluster - Allowable Costs/Cost PrinciplesFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, NationalSchool Lunch Program, COVID-19 - National School Lunch ProgramAssistance Listings Numbers: 10.553, 10.555Federal Award Numbers and Years (or Other Identifying Numbers): FY2021, FY2022Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Allowable Costs/Cost PrinciplesAudit Findings: Material Weakness, Other MattersCondition and ContextAn effective internal control system was not in place at the School Corporation to ensure compliancewith requirements related to the grant agreement and the Allowable Costs/Cost Principles compliancerequirement.The School Corporation had not developed nor implemented internal controls over transactionspaid from the Child Nutrition Cluster funds to ensure that the payment was an allowable cost for the benefitof the food service program.Additionally, the School Corporation paid food service employees that worked more than 5.25 hoursa day on a biweekly basis with payments that continued into the summer. In order to do this, an employee'spay was annualized based on the expected number of days worked and then divided by 26. Each employeewas required to complete a timesheet every two weeks, which was approved by their supervisor, to supportthe time worked during the school year. Four of the fourteen paychecks selected for testing had errors.Two of the paychecks did not have the required timesheets, and two of the paychecks did not havetimesheets that reflected time worked to adequately support the amount paid to the employee.The lack of internal controls was a systemic issue for all disbursements throughout the audit period.The noncompliance was isolated to payroll disbursements for the school year ended June 30, 2021.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring 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 criteriain order to be allowable under Federal awards:(a) Be necessary and reasonable for the performance of the Federal award and be allocablethereto under these principles.(b) Conform to any limitations or exclusions set forth in these principles or in the Federalaward as to types or amount of cost items. . . .(g) Be adequately documented. . . ."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 thataccurately reflect the work performed. These records must:(i) Be supported by a system of internal control which provides reasonableassurance 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 bythe non-Federal entity, not exceeding 100% of compensated activities . . .(vii) Support the distribution of the employee's salary or wages among specificactivities or cost objectives if the employee works on more than one Federal award; aFederal award and non-Federal award; an indirect cost activity and a direct costactivity; two or more indirect activities which are allocated using different allocationbases; or an unallowable activity and a direct or indirect cost activity. . . ."CauseManagement had not developed a system of internal controls that would have ensured compliancewith the Allowable Costs/Cost Principles compliance requirement.EffectThe failure to establish an effective internal control system enabled material noncompliance to goundetected. Noncompliance with the grant agreement and the Allowable Costs/Cost Principles compliancerequirement could result in the loss of future federal funds to the School Corporation.Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish internal controls to ensurecompliance and comply with the grant agreement and the Allowable Costs/Cost Principles compliancerequirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-004Subject: Child Nutrition Cluster - Activities Allowed or Unallowed, Reporting, SpecialTests and Provisions - Non-Profit School Food Service AccountsFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, NationalSchool Lunch Program, COVID-19 - National School Lunch ProgramAssistance Listings Numbers: 10.553, 10.555Federal Award Numbers and Years (or Other Identifying Numbers): FY2021, FY2022Pass-Through Entity: Indiana Department of EducationCompliance Requirements: Activities Allowed or Unallowed, Reporting, Special Tests andProvisions - Non-Profit School Food Service AccountsAudit Finding: Material WeaknessCondition and ContextAn effective internal control system was not designed nor implemented at the School Corporationto ensure compliance with requirements related to the grant agreement and the Activities Allowed orUnallowed, the Reporting, and the Special Tests and Provisions - Non-Profit School Food Service Accountscompliance requirements.Activities Allowed or UnallowedThe School Corporation had not designed nor implemented a system of internal control overSchool Lunch fund disbursements to ensure all activities were for the benefit of the ChildNutrition Cluster. One employee was responsible for processing disbursements without anoversight or review process in place to prevent, or detect and correct, errors.ReportingThe School Corporation had not designed nor implemented a system of internal control toensure that reimbursement requests were accurately submitted. The reimbursement requestswere prepared by one employee based on meals served without an oversight or review processin place to prevent, or detect and correct, errors.Special Tests and Provisions - Non-Profit School Food Service AccountsThe School Corporation had not designed nor implemented a system of internal controls toensure all revenue generated by the school food service was used to operate and improve itsfood service. One employee was responsible for the receipting and disbursing of School Lunchfunds without an oversight or review process in place to prevent or detect and correct errors.The lack of internal controls was a systemic issue throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."CauseManagement had not developed nor implemented a system of internal controls that would haveensured compliance with the grant agreement and the Activities Allowed or Unallowed, the Reporting, andthe Special Tests and Provisions - Non-Profit School Food Service Accounts compliance requirements.EffectThe failure to establish an effective internal control system could have enabled material noncomplianceto go undetected.Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish internal controls to ensurecompliance with the grant agreement and the Activities Allowed or Unallowed, the Reporting, and theSpecial Tests and Provisions - Non-Profit School Food Service Accounts compliance requirements.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-003Subject: Child Nutrition Cluster - Allowable Costs/Cost PrinciplesFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, NationalSchool Lunch Program, COVID-19 - National School Lunch ProgramAssistance Listings Numbers: 10.553, 10.555Federal Award Numbers and Years (or Other Identifying Numbers): FY2021, FY2022Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Allowable Costs/Cost PrinciplesAudit Findings: Material Weakness, Other MattersCondition and ContextAn effective internal control system was not in place at the School Corporation to ensure compliancewith requirements related to the grant agreement and the Allowable Costs/Cost Principles compliancerequirement.The School Corporation had not developed nor implemented internal controls over transactionspaid from the Child Nutrition Cluster funds to ensure that the payment was an allowable cost for the benefitof the food service program.Additionally, the School Corporation paid food service employees that worked more than 5.25 hoursa day on a biweekly basis with payments that continued into the summer. In order to do this, an employee'spay was annualized based on the expected number of days worked and then divided by 26. Each employeewas required to complete a timesheet every two weeks, which was approved by their supervisor, to supportthe time worked during the school year. Four of the fourteen paychecks selected for testing had errors.Two of the paychecks did not have the required timesheets, and two of the paychecks did not havetimesheets that reflected time worked to adequately support the amount paid to the employee.The lack of internal controls was a systemic issue for all disbursements throughout the audit period.The noncompliance was isolated to payroll disbursements for the school year ended June 30, 2021.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring 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 criteriain order to be allowable under Federal awards:(a) Be necessary and reasonable for the performance of the Federal award and be allocablethereto under these principles.(b) Conform to any limitations or exclusions set forth in these principles or in the Federalaward as to types or amount of cost items. . . .(g) Be adequately documented. . . ."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 thataccurately reflect the work performed. These records must:(i) Be supported by a system of internal control which provides reasonableassurance 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 bythe non-Federal entity, not exceeding 100% of compensated activities . . .(vii) Support the distribution of the employee's salary or wages among specificactivities or cost objectives if the employee works on more than one Federal award; aFederal award and non-Federal award; an indirect cost activity and a direct costactivity; two or more indirect activities which are allocated using different allocationbases; or an unallowable activity and a direct or indirect cost activity. . . ."CauseManagement had not developed a system of internal controls that would have ensured compliancewith the Allowable Costs/Cost Principles compliance requirement.EffectThe failure to establish an effective internal control system enabled material noncompliance to goundetected. Noncompliance with the grant agreement and the Allowable Costs/Cost Principles compliancerequirement could result in the loss of future federal funds to the School Corporation.Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish internal controls to ensurecompliance and comply with the grant agreement and the Allowable Costs/Cost Principles compliancerequirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-004Subject: Child Nutrition Cluster - Activities Allowed or Unallowed, Reporting, SpecialTests and Provisions - Non-Profit School Food Service AccountsFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, NationalSchool Lunch Program, COVID-19 - National School Lunch ProgramAssistance Listings Numbers: 10.553, 10.555Federal Award Numbers and Years (or Other Identifying Numbers): FY2021, FY2022Pass-Through Entity: Indiana Department of EducationCompliance Requirements: Activities Allowed or Unallowed, Reporting, Special Tests andProvisions - Non-Profit School Food Service AccountsAudit Finding: Material WeaknessCondition and ContextAn effective internal control system was not designed nor implemented at the School Corporationto ensure compliance with requirements related to the grant agreement and the Activities Allowed orUnallowed, the Reporting, and the Special Tests and Provisions - Non-Profit School Food Service Accountscompliance requirements.Activities Allowed or UnallowedThe School Corporation had not designed nor implemented a system of internal control overSchool Lunch fund disbursements to ensure all activities were for the benefit of the ChildNutrition Cluster. One employee was responsible for processing disbursements without anoversight or review process in place to prevent, or detect and correct, errors.ReportingThe School Corporation had not designed nor implemented a system of internal control toensure that reimbursement requests were accurately submitted. The reimbursement requestswere prepared by one employee based on meals served without an oversight or review processin place to prevent, or detect and correct, errors.Special Tests and Provisions - Non-Profit School Food Service AccountsThe School Corporation had not designed nor implemented a system of internal controls toensure all revenue generated by the school food service was used to operate and improve itsfood service. One employee was responsible for the receipting and disbursing of School Lunchfunds without an oversight or review process in place to prevent or detect and correct errors.The lack of internal controls was a systemic issue throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."CauseManagement had not developed nor implemented a system of internal controls that would haveensured compliance with the grant agreement and the Activities Allowed or Unallowed, the Reporting, andthe Special Tests and Provisions - Non-Profit School Food Service Accounts compliance requirements.EffectThe failure to establish an effective internal control system could have enabled material noncomplianceto go undetected.Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish internal controls to ensurecompliance with the grant agreement and the Activities Allowed or Unallowed, the Reporting, and theSpecial Tests and Provisions - Non-Profit School Food Service Accounts compliance requirements.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-003Subject: Child Nutrition Cluster - Allowable Costs/Cost PrinciplesFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, NationalSchool Lunch Program, COVID-19 - National School Lunch ProgramAssistance Listings Numbers: 10.553, 10.555Federal Award Numbers and Years (or Other Identifying Numbers): FY2021, FY2022Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Allowable Costs/Cost PrinciplesAudit Findings: Material Weakness, Other MattersCondition and ContextAn effective internal control system was not in place at the School Corporation to ensure compliancewith requirements related to the grant agreement and the Allowable Costs/Cost Principles compliancerequirement.The School Corporation had not developed nor implemented internal controls over transactionspaid from the Child Nutrition Cluster funds to ensure that the payment was an allowable cost for the benefitof the food service program.Additionally, the School Corporation paid food service employees that worked more than 5.25 hoursa day on a biweekly basis with payments that continued into the summer. In order to do this, an employee'spay was annualized based on the expected number of days worked and then divided by 26. Each employeewas required to complete a timesheet every two weeks, which was approved by their supervisor, to supportthe time worked during the school year. Four of the fourteen paychecks selected for testing had errors.Two of the paychecks did not have the required timesheets, and two of the paychecks did not havetimesheets that reflected time worked to adequately support the amount paid to the employee.The lack of internal controls was a systemic issue for all disbursements throughout the audit period.The noncompliance was isolated to payroll disbursements for the school year ended June 30, 2021.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring 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 criteriain order to be allowable under Federal awards:(a) Be necessary and reasonable for the performance of the Federal award and be allocablethereto under these principles.(b) Conform to any limitations or exclusions set forth in these principles or in the Federalaward as to types or amount of cost items. . . .(g) Be adequately documented. . . ."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 thataccurately reflect the work performed. These records must:(i) Be supported by a system of internal control which provides reasonableassurance 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 bythe non-Federal entity, not exceeding 100% of compensated activities . . .(vii) Support the distribution of the employee's salary or wages among specificactivities or cost objectives if the employee works on more than one Federal award; aFederal award and non-Federal award; an indirect cost activity and a direct costactivity; two or more indirect activities which are allocated using different allocationbases; or an unallowable activity and a direct or indirect cost activity. . . ."CauseManagement had not developed a system of internal controls that would have ensured compliancewith the Allowable Costs/Cost Principles compliance requirement.EffectThe failure to establish an effective internal control system enabled material noncompliance to goundetected. Noncompliance with the grant agreement and the Allowable Costs/Cost Principles compliancerequirement could result in the loss of future federal funds to the School Corporation.Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish internal controls to ensurecompliance and comply with the grant agreement and the Allowable Costs/Cost Principles compliancerequirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-004Subject: Child Nutrition Cluster - Activities Allowed or Unallowed, Reporting, SpecialTests and Provisions - Non-Profit School Food Service AccountsFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, NationalSchool Lunch Program, COVID-19 - National School Lunch ProgramAssistance Listings Numbers: 10.553, 10.555Federal Award Numbers and Years (or Other Identifying Numbers): FY2021, FY2022Pass-Through Entity: Indiana Department of EducationCompliance Requirements: Activities Allowed or Unallowed, Reporting, Special Tests andProvisions - Non-Profit School Food Service AccountsAudit Finding: Material WeaknessCondition and ContextAn effective internal control system was not designed nor implemented at the School Corporationto ensure compliance with requirements related to the grant agreement and the Activities Allowed orUnallowed, the Reporting, and the Special Tests and Provisions - Non-Profit School Food Service Accountscompliance requirements.Activities Allowed or UnallowedThe School Corporation had not designed nor implemented a system of internal control overSchool Lunch fund disbursements to ensure all activities were for the benefit of the ChildNutrition Cluster. One employee was responsible for processing disbursements without anoversight or review process in place to prevent, or detect and correct, errors.ReportingThe School Corporation had not designed nor implemented a system of internal control toensure that reimbursement requests were accurately submitted. The reimbursement requestswere prepared by one employee based on meals served without an oversight or review processin place to prevent, or detect and correct, errors.Special Tests and Provisions - Non-Profit School Food Service AccountsThe School Corporation had not designed nor implemented a system of internal controls toensure all revenue generated by the school food service was used to operate and improve itsfood service. One employee was responsible for the receipting and disbursing of School Lunchfunds without an oversight or review process in place to prevent or detect and correct errors.The lack of internal controls was a systemic issue throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."CauseManagement had not developed nor implemented a system of internal controls that would haveensured compliance with the grant agreement and the Activities Allowed or Unallowed, the Reporting, andthe Special Tests and Provisions - Non-Profit School Food Service Accounts compliance requirements.EffectThe failure to establish an effective internal control system could have enabled material noncomplianceto go undetected.Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish internal controls to ensurecompliance with the grant agreement and the Activities Allowed or Unallowed, the Reporting, and theSpecial Tests and Provisions - Non-Profit School Food Service Accounts compliance requirements.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-003Subject: Child Nutrition Cluster - Allowable Costs/Cost PrinciplesFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, NationalSchool Lunch Program, COVID-19 - National School Lunch ProgramAssistance Listings Numbers: 10.553, 10.555Federal Award Numbers and Years (or Other Identifying Numbers): FY2021, FY2022Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Allowable Costs/Cost PrinciplesAudit Findings: Material Weakness, Other MattersCondition and ContextAn effective internal control system was not in place at the School Corporation to ensure compliancewith requirements related to the grant agreement and the Allowable Costs/Cost Principles compliancerequirement.The School Corporation had not developed nor implemented internal controls over transactionspaid from the Child Nutrition Cluster funds to ensure that the payment was an allowable cost for the benefitof the food service program.Additionally, the School Corporation paid food service employees that worked more than 5.25 hoursa day on a biweekly basis with payments that continued into the summer. In order to do this, an employee'spay was annualized based on the expected number of days worked and then divided by 26. Each employeewas required to complete a timesheet every two weeks, which was approved by their supervisor, to supportthe time worked during the school year. Four of the fourteen paychecks selected for testing had errors.Two of the paychecks did not have the required timesheets, and two of the paychecks did not havetimesheets that reflected time worked to adequately support the amount paid to the employee.The lack of internal controls was a systemic issue for all disbursements throughout the audit period.The noncompliance was isolated to payroll disbursements for the school year ended June 30, 2021.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring 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 criteriain order to be allowable under Federal awards:(a) Be necessary and reasonable for the performance of the Federal award and be allocablethereto under these principles.(b) Conform to any limitations or exclusions set forth in these principles or in the Federalaward as to types or amount of cost items. . . .(g) Be adequately documented. . . ."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 thataccurately reflect the work performed. These records must:(i) Be supported by a system of internal control which provides reasonableassurance 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 bythe non-Federal entity, not exceeding 100% of compensated activities . . .(vii) Support the distribution of the employee's salary or wages among specificactivities or cost objectives if the employee works on more than one Federal award; aFederal award and non-Federal award; an indirect cost activity and a direct costactivity; two or more indirect activities which are allocated using different allocationbases; or an unallowable activity and a direct or indirect cost activity. . . ."CauseManagement had not developed a system of internal controls that would have ensured compliancewith the Allowable Costs/Cost Principles compliance requirement.EffectThe failure to establish an effective internal control system enabled material noncompliance to goundetected. Noncompliance with the grant agreement and the Allowable Costs/Cost Principles compliancerequirement could result in the loss of future federal funds to the School Corporation.Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish internal controls to ensurecompliance and comply with the grant agreement and the Allowable Costs/Cost Principles compliancerequirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-004Subject: Child Nutrition Cluster - Activities Allowed or Unallowed, Reporting, SpecialTests and Provisions - Non-Profit School Food Service AccountsFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, NationalSchool Lunch Program, COVID-19 - National School Lunch ProgramAssistance Listings Numbers: 10.553, 10.555Federal Award Numbers and Years (or Other Identifying Numbers): FY2021, FY2022Pass-Through Entity: Indiana Department of EducationCompliance Requirements: Activities Allowed or Unallowed, Reporting, Special Tests andProvisions - Non-Profit School Food Service AccountsAudit Finding: Material WeaknessCondition and ContextAn effective internal control system was not designed nor implemented at the School Corporationto ensure compliance with requirements related to the grant agreement and the Activities Allowed orUnallowed, the Reporting, and the Special Tests and Provisions - Non-Profit School Food Service Accountscompliance requirements.Activities Allowed or UnallowedThe School Corporation had not designed nor implemented a system of internal control overSchool Lunch fund disbursements to ensure all activities were for the benefit of the ChildNutrition Cluster. One employee was responsible for processing disbursements without anoversight or review process in place to prevent, or detect and correct, errors.ReportingThe School Corporation had not designed nor implemented a system of internal control toensure that reimbursement requests were accurately submitted. The reimbursement requestswere prepared by one employee based on meals served without an oversight or review processin place to prevent, or detect and correct, errors.Special Tests and Provisions - Non-Profit School Food Service AccountsThe School Corporation had not designed nor implemented a system of internal controls toensure all revenue generated by the school food service was used to operate and improve itsfood service. One employee was responsible for the receipting and disbursing of School Lunchfunds without an oversight or review process in place to prevent or detect and correct errors.The lack of internal controls was a systemic issue throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."CauseManagement had not developed nor implemented a system of internal controls that would haveensured compliance with the grant agreement and the Activities Allowed or Unallowed, the Reporting, andthe Special Tests and Provisions - Non-Profit School Food Service Accounts compliance requirements.EffectThe failure to establish an effective internal control system could have enabled material noncomplianceto go undetected.Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish internal controls to ensurecompliance with the grant agreement and the Activities Allowed or Unallowed, the Reporting, and theSpecial Tests and Provisions - Non-Profit School Food Service Accounts compliance requirements.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-003Subject: Child Nutrition Cluster - Allowable Costs/Cost PrinciplesFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, NationalSchool Lunch Program, COVID-19 - National School Lunch ProgramAssistance Listings Numbers: 10.553, 10.555Federal Award Numbers and Years (or Other Identifying Numbers): FY2021, FY2022Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Allowable Costs/Cost PrinciplesAudit Findings: Material Weakness, Other MattersCondition and ContextAn effective internal control system was not in place at the School Corporation to ensure compliancewith requirements related to the grant agreement and the Allowable Costs/Cost Principles compliancerequirement.The School Corporation had not developed nor implemented internal controls over transactionspaid from the Child Nutrition Cluster funds to ensure that the payment was an allowable cost for the benefitof the food service program.Additionally, the School Corporation paid food service employees that worked more than 5.25 hoursa day on a biweekly basis with payments that continued into the summer. In order to do this, an employee'spay was annualized based on the expected number of days worked and then divided by 26. Each employeewas required to complete a timesheet every two weeks, which was approved by their supervisor, to supportthe time worked during the school year. Four of the fourteen paychecks selected for testing had errors.Two of the paychecks did not have the required timesheets, and two of the paychecks did not havetimesheets that reflected time worked to adequately support the amount paid to the employee.The lack of internal controls was a systemic issue for all disbursements throughout the audit period.The noncompliance was isolated to payroll disbursements for the school year ended June 30, 2021.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring 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 criteriain order to be allowable under Federal awards:(a) Be necessary and reasonable for the performance of the Federal award and be allocablethereto under these principles.(b) Conform to any limitations or exclusions set forth in these principles or in the Federalaward as to types or amount of cost items. . . .(g) Be adequately documented. . . ."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 thataccurately reflect the work performed. These records must:(i) Be supported by a system of internal control which provides reasonableassurance 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 bythe non-Federal entity, not exceeding 100% of compensated activities . . .(vii) Support the distribution of the employee's salary or wages among specificactivities or cost objectives if the employee works on more than one Federal award; aFederal award and non-Federal award; an indirect cost activity and a direct costactivity; two or more indirect activities which are allocated using different allocationbases; or an unallowable activity and a direct or indirect cost activity. . . ."CauseManagement had not developed a system of internal controls that would have ensured compliancewith the Allowable Costs/Cost Principles compliance requirement.EffectThe failure to establish an effective internal control system enabled material noncompliance to goundetected. Noncompliance with the grant agreement and the Allowable Costs/Cost Principles compliancerequirement could result in the loss of future federal funds to the School Corporation.Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish internal controls to ensurecompliance and comply with the grant agreement and the Allowable Costs/Cost Principles compliancerequirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-004Subject: Child Nutrition Cluster - Activities Allowed or Unallowed, Reporting, SpecialTests and Provisions - Non-Profit School Food Service AccountsFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, NationalSchool Lunch Program, COVID-19 - National School Lunch ProgramAssistance Listings Numbers: 10.553, 10.555Federal Award Numbers and Years (or Other Identifying Numbers): FY2021, FY2022Pass-Through Entity: Indiana Department of EducationCompliance Requirements: Activities Allowed or Unallowed, Reporting, Special Tests andProvisions - Non-Profit School Food Service AccountsAudit Finding: Material WeaknessCondition and ContextAn effective internal control system was not designed nor implemented at the School Corporationto ensure compliance with requirements related to the grant agreement and the Activities Allowed orUnallowed, the Reporting, and the Special Tests and Provisions - Non-Profit School Food Service Accountscompliance requirements.Activities Allowed or UnallowedThe School Corporation had not designed nor implemented a system of internal control overSchool Lunch fund disbursements to ensure all activities were for the benefit of the ChildNutrition Cluster. One employee was responsible for processing disbursements without anoversight or review process in place to prevent, or detect and correct, errors.ReportingThe School Corporation had not designed nor implemented a system of internal control toensure that reimbursement requests were accurately submitted. The reimbursement requestswere prepared by one employee based on meals served without an oversight or review processin place to prevent, or detect and correct, errors.Special Tests and Provisions - Non-Profit School Food Service AccountsThe School Corporation had not designed nor implemented a system of internal controls toensure all revenue generated by the school food service was used to operate and improve itsfood service. One employee was responsible for the receipting and disbursing of School Lunchfunds without an oversight or review process in place to prevent or detect and correct errors.The lack of internal controls was a systemic issue throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."CauseManagement had not developed nor implemented a system of internal controls that would haveensured compliance with the grant agreement and the Activities Allowed or Unallowed, the Reporting, andthe Special Tests and Provisions - Non-Profit School Food Service Accounts compliance requirements.EffectThe failure to establish an effective internal control system could have enabled material noncomplianceto go undetected.Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish internal controls to ensurecompliance with the grant agreement and the Activities Allowed or Unallowed, the Reporting, and theSpecial Tests and Provisions - Non-Profit School Food Service Accounts compliance requirements.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-003Subject: Child Nutrition Cluster - Allowable Costs/Cost PrinciplesFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, NationalSchool Lunch Program, COVID-19 - National School Lunch ProgramAssistance Listings Numbers: 10.553, 10.555Federal Award Numbers and Years (or Other Identifying Numbers): FY2021, FY2022Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Allowable Costs/Cost PrinciplesAudit Findings: Material Weakness, Other MattersCondition and ContextAn effective internal control system was not in place at the School Corporation to ensure compliancewith requirements related to the grant agreement and the Allowable Costs/Cost Principles compliancerequirement.The School Corporation had not developed nor implemented internal controls over transactionspaid from the Child Nutrition Cluster funds to ensure that the payment was an allowable cost for the benefitof the food service program.Additionally, the School Corporation paid food service employees that worked more than 5.25 hoursa day on a biweekly basis with payments that continued into the summer. In order to do this, an employee'spay was annualized based on the expected number of days worked and then divided by 26. Each employeewas required to complete a timesheet every two weeks, which was approved by their supervisor, to supportthe time worked during the school year. Four of the fourteen paychecks selected for testing had errors.Two of the paychecks did not have the required timesheets, and two of the paychecks did not havetimesheets that reflected time worked to adequately support the amount paid to the employee.The lack of internal controls was a systemic issue for all disbursements throughout the audit period.The noncompliance was isolated to payroll disbursements for the school year ended June 30, 2021.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring 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 criteriain order to be allowable under Federal awards:(a) Be necessary and reasonable for the performance of the Federal award and be allocablethereto under these principles.(b) Conform to any limitations or exclusions set forth in these principles or in the Federalaward as to types or amount of cost items. . . .(g) Be adequately documented. . . ."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 thataccurately reflect the work performed. These records must:(i) Be supported by a system of internal control which provides reasonableassurance 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 bythe non-Federal entity, not exceeding 100% of compensated activities . . .(vii) Support the distribution of the employee's salary or wages among specificactivities or cost objectives if the employee works on more than one Federal award; aFederal award and non-Federal award; an indirect cost activity and a direct costactivity; two or more indirect activities which are allocated using different allocationbases; or an unallowable activity and a direct or indirect cost activity. . . ."CauseManagement had not developed a system of internal controls that would have ensured compliancewith the Allowable Costs/Cost Principles compliance requirement.EffectThe failure to establish an effective internal control system enabled material noncompliance to goundetected. Noncompliance with the grant agreement and the Allowable Costs/Cost Principles compliancerequirement could result in the loss of future federal funds to the School Corporation.Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish internal controls to ensurecompliance and comply with the grant agreement and the Allowable Costs/Cost Principles compliancerequirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-004Subject: Child Nutrition Cluster - Activities Allowed or Unallowed, Reporting, SpecialTests and Provisions - Non-Profit School Food Service AccountsFederal Agency: Department of AgricultureFederal Programs: School Breakfast Program, COVID-19 - School Breakfast Program, NationalSchool Lunch Program, COVID-19 - National School Lunch ProgramAssistance Listings Numbers: 10.553, 10.555Federal Award Numbers and Years (or Other Identifying Numbers): FY2021, FY2022Pass-Through Entity: Indiana Department of EducationCompliance Requirements: Activities Allowed or Unallowed, Reporting, Special Tests andProvisions - Non-Profit School Food Service AccountsAudit Finding: Material WeaknessCondition and ContextAn effective internal control system was not designed nor implemented at the School Corporationto ensure compliance with requirements related to the grant agreement and the Activities Allowed orUnallowed, the Reporting, and the Special Tests and Provisions - Non-Profit School Food Service Accountscompliance requirements.Activities Allowed or UnallowedThe School Corporation had not designed nor implemented a system of internal control overSchool Lunch fund disbursements to ensure all activities were for the benefit of the ChildNutrition Cluster. One employee was responsible for processing disbursements without anoversight or review process in place to prevent, or detect and correct, errors.ReportingThe School Corporation had not designed nor implemented a system of internal control toensure that reimbursement requests were accurately submitted. The reimbursement requestswere prepared by one employee based on meals served without an oversight or review processin place to prevent, or detect and correct, errors.Special Tests and Provisions - Non-Profit School Food Service AccountsThe School Corporation had not designed nor implemented a system of internal controls toensure all revenue generated by the school food service was used to operate and improve itsfood service. One employee was responsible for the receipting and disbursing of School Lunchfunds without an oversight or review process in place to prevent or detect and correct errors.The lack of internal controls was a systemic issue throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."CauseManagement had not developed nor implemented a system of internal controls that would haveensured compliance with the grant agreement and the Activities Allowed or Unallowed, the Reporting, andthe Special Tests and Provisions - Non-Profit School Food Service Accounts compliance requirements.EffectThe failure to establish an effective internal control system could have enabled material noncomplianceto go undetected.Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish internal controls to ensurecompliance with the grant agreement and the Activities Allowed or Unallowed, the Reporting, and theSpecial Tests and Provisions - Non-Profit School Food Service Accounts compliance requirements.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-007Subject: COVID-19 - Education Stabilization Fund - ReportingFederal Agency: Department of EducationFederal Program: COVID-19 - Education Stabilization FundAssistance Listings Numbers: 84.425C, 84.425D, 84.425UFederal Award Numbers and Years (or Other Identifying Numbers): S425C200018, S425D200013,S425U210013Pass-Through Entity: Indiana Department of EducationCompliance Requirement: ReportingAudit Finding: Material WeaknessCondition and ContextAn effective internal control system, was not designed nor implemented at the School Corporationto ensure compliance with requirements related to the grant agreement and the Reporting compliancerequirement.The School Corporation had not designed nor implemented a system of internal controls to ensurethat the annual Elementary and Secondary School Emergency Relief (ESSER) and the Governor'sEmergency Education Relief (GEER) annual Data Collection reports (Reports) were complete and accuratelysubmitted. The Reports were prepared by one employee without an oversight or review processin place to prevent, or detect and correct, errors.The lack of internal controls was a systemic issue throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."CauseManagement had not developed nor implemented an effective internal control system that wouldhave ensured compliance with the grant agreement and the Reporting compliance requirement.EffectThe failure to establish an effective internal control system could have enabled material noncomplianceto go undetected.Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish internal controls to ensurecompliance with the grant agreement and the Reporting compliance requirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-007Subject: COVID-19 - Education Stabilization Fund - ReportingFederal Agency: Department of EducationFederal Program: COVID-19 - Education Stabilization FundAssistance Listings Numbers: 84.425C, 84.425D, 84.425UFederal Award Numbers and Years (or Other Identifying Numbers): S425C200018, S425D200013,S425U210013Pass-Through Entity: Indiana Department of EducationCompliance Requirement: ReportingAudit Finding: Material WeaknessCondition and ContextAn effective internal control system, was not designed nor implemented at the School Corporationto ensure compliance with requirements related to the grant agreement and the Reporting compliancerequirement.The School Corporation had not designed nor implemented a system of internal controls to ensurethat the annual Elementary and Secondary School Emergency Relief (ESSER) and the Governor'sEmergency Education Relief (GEER) annual Data Collection reports (Reports) were complete and accuratelysubmitted. The Reports were prepared by one employee without an oversight or review processin place to prevent, or detect and correct, errors.The lack of internal controls was a systemic issue throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."CauseManagement had not developed nor implemented an effective internal control system that wouldhave ensured compliance with the grant agreement and the Reporting compliance requirement.EffectThe failure to establish an effective internal control system could have enabled material noncomplianceto go undetected.Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish internal controls to ensurecompliance with the grant agreement and the Reporting compliance requirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-005Subject: COVID-19 - Education Stabilization Fund - Allowable Costs/Cost PrinciplesFederal Agency: Department of EducationFederal Program: COVID-19 - Education Stabilization FundAssistance Listings Numbers: 84.425D, 84.425UFederal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425U210013Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Allowable Costs/Cost PrinciplesAudit Findings: Material Weakness, Modified OpinionCondition and ContextAn effective internal control system was not in place at the School Corporation in order to ensurecompliance with requirements related to the grant agreement and the Allowable Costs/Cost Principlescompliance requirement.The School Corporation did not have adequate internal controls in place to ensure that the reimbursementrequests included salaries for all contracted employees and adequate supporting documentationor personnel activity reports, such as time and effort logs or Semi-Annual Certifications. The SchoolCorporation paid salaries for all contracted employees without adequate supporting documentation orpersonnel activity reports, such as time and effort logs or Semi-Annual Certifications. The total amountpaid to contracted employees was $51,644. This amount was considered questioned costs.The lack of internal controls and noncompliance were systemic issues throughout the audit period.CriteriaCFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring 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 thataccurately reflect the work performed. These records must:(i) Be supported by a system of internal control which provides reasonableassurance 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 bythe non-Federal entity, not exceeding 100% of compensated activities . . .(vii) Support the distribution of the employee's salary or wages among specificactivities or cost objectives if the employee works on more than one Federal award; aFederal award and non-Federal award; an indirect cost activity and a direct costactivity; two or more indirect activities which are allocated using different allocationbases; or an unallowable activity and a direct or indirect cost activity. . . ."CauseManagement had not developed a system of internal controls that would have ensured compliancewith the Allowable Costs/Cost Principles compliance requirement.EffectThe failure to establish an effective internal control system enabled material noncompliance to goundetected. Noncompliance with the grant agreement and the Allowable Costs/Cost Principles compliancerequirement could have resulted in the loss of federal funds to the School Corporation.Questioned CostsQuestioned costs of $51,644 were identified, as described in the Condition and Context.RecommendationWe recommended that the School Corporation's management establish a system of internal controlsto ensure compliance and comply with the grant agreement and the Allowable Costs/Cost Principlescompliance requirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-006Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property ManagementFederal Agency: Department of EducationFederal Program: COVID-19 - Education Stabilization FundAssistance Listings Number: 84.425DFederal Award Number and Year (or Other Identifying Number): S425D200013Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Equipment and Real Property ManagementAudit Findings: Material Weakness, Modified OpinionCondition and ContextAn effective internal control system was not in place at the School Corporation to ensure compliancewith requirements related to the grant agreement and the Equipment and Real Property Managementcompliance requirement.The School Corporation purchased $72,425 of various equipment with Elementary and SecondarySchool Emergency Relief (ESSER) funds. The equipment was not added to the property record whichwould include a description of the property, a serial number or other identification number, the source offunding for the property (including the federal award identification number (FAIN)), who holds title, theacquisition date, cost of the property, percentage of federal participation in the project costs for the federalaward under which the property was acquired, the location, and the use and condition of the property.Additionally, the School Corporation did not adequately safeguard the equipment purchased and had notcompleted a physical inventory of equipment within the last two years.The lack of internal controls and noncompliance were systemic issues throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."2 CFR 200.313(d) states in part:"(1) Property records must be maintained that include a description of the property, a serialnumber or other identification number, the source of funding for the property (includingthe FAIN), who holds title, the acquisition date, and cost of the property, percentage offederal participation in the project costs for the federal award under which the propertywas acquired, the location, use and condition of the property, and any ultimate dispositiondata including the date of disposal and sales price of the property(2) A physical inventory of the property must be taken and the results reconciled with theproperty records at least once every two years.(3) A control system must be developed to ensure adequate safeguards to prevent loss,damage, or theft of the property. Any loss, damage, or theft must be investigated. . . ."CauseManagement had not developed a system of internal controls that would have ensured compliancewith the grant agreement and the Equipment and Real Property compliance requirement.EffectThe failure to establish an effective internal control system enabled material noncompliance to goundetected. Noncompliance with the grant agreement and the Equipment and Real Property Managementcompliance requirement could have resulted in the loss of future federal funds to the School Corporation.Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish a system of internal controlsto ensure compliance and comply with the grant agreement and the Equipment and Real PropertyManagement compliance requirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-007Subject: COVID-19 - Education Stabilization Fund - ReportingFederal Agency: Department of EducationFederal Program: COVID-19 - Education Stabilization FundAssistance Listings Numbers: 84.425C, 84.425D, 84.425UFederal Award Numbers and Years (or Other Identifying Numbers): S425C200018, S425D200013,S425U210013Pass-Through Entity: Indiana Department of EducationCompliance Requirement: ReportingAudit Finding: Material WeaknessCondition and ContextAn effective internal control system, was not designed nor implemented at the School Corporationto ensure compliance with requirements related to the grant agreement and the Reporting compliancerequirement.The School Corporation had not designed nor implemented a system of internal controls to ensurethat the annual Elementary and Secondary School Emergency Relief (ESSER) and the Governor'sEmergency Education Relief (GEER) annual Data Collection reports (Reports) were complete and accuratelysubmitted. The Reports were prepared by one employee without an oversight or review processin place to prevent, or detect and correct, errors.The lack of internal controls was a systemic issue throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."CauseManagement had not developed nor implemented an effective internal control system that wouldhave ensured compliance with the grant agreement and the Reporting compliance requirement.EffectThe failure to establish an effective internal control system could have enabled material noncomplianceto go undetected.Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish internal controls to ensurecompliance with the grant agreement and the Reporting compliance requirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-005Subject: COVID-19 - Education Stabilization Fund - Allowable Costs/Cost PrinciplesFederal Agency: Department of EducationFederal Program: COVID-19 - Education Stabilization FundAssistance Listings Numbers: 84.425D, 84.425UFederal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425U210013Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Allowable Costs/Cost PrinciplesAudit Findings: Material Weakness, Modified OpinionCondition and ContextAn effective internal control system was not in place at the School Corporation in order to ensurecompliance with requirements related to the grant agreement and the Allowable Costs/Cost Principlescompliance requirement.The School Corporation did not have adequate internal controls in place to ensure that the reimbursementrequests included salaries for all contracted employees and adequate supporting documentationor personnel activity reports, such as time and effort logs or Semi-Annual Certifications. The SchoolCorporation paid salaries for all contracted employees without adequate supporting documentation orpersonnel activity reports, such as time and effort logs or Semi-Annual Certifications. The total amountpaid to contracted employees was $51,644. This amount was considered questioned costs.The lack of internal controls and noncompliance were systemic issues throughout the audit period.CriteriaCFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring 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 thataccurately reflect the work performed. These records must:(i) Be supported by a system of internal control which provides reasonableassurance 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 bythe non-Federal entity, not exceeding 100% of compensated activities . . .(vii) Support the distribution of the employee's salary or wages among specificactivities or cost objectives if the employee works on more than one Federal award; aFederal award and non-Federal award; an indirect cost activity and a direct costactivity; two or more indirect activities which are allocated using different allocationbases; or an unallowable activity and a direct or indirect cost activity. . . ."CauseManagement had not developed a system of internal controls that would have ensured compliancewith the Allowable Costs/Cost Principles compliance requirement.EffectThe failure to establish an effective internal control system enabled material noncompliance to goundetected. Noncompliance with the grant agreement and the Allowable Costs/Cost Principles compliancerequirement could have resulted in the loss of federal funds to the School Corporation.Questioned CostsQuestioned costs of $51,644 were identified, as described in the Condition and Context.RecommendationWe recommended that the School Corporation's management establish a system of internal controlsto ensure compliance and comply with the grant agreement and the Allowable Costs/Cost Principlescompliance requirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-005Subject: COVID-19 - Education Stabilization Fund - Allowable Costs/Cost PrinciplesFederal Agency: Department of EducationFederal Program: COVID-19 - Education Stabilization FundAssistance Listings Numbers: 84.425D, 84.425UFederal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425U210013Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Allowable Costs/Cost PrinciplesAudit Findings: Material Weakness, Modified OpinionCondition and ContextAn effective internal control system was not in place at the School Corporation in order to ensurecompliance with requirements related to the grant agreement and the Allowable Costs/Cost Principlescompliance requirement.The School Corporation did not have adequate internal controls in place to ensure that the reimbursementrequests included salaries for all contracted employees and adequate supporting documentationor personnel activity reports, such as time and effort logs or Semi-Annual Certifications. The SchoolCorporation paid salaries for all contracted employees without adequate supporting documentation orpersonnel activity reports, such as time and effort logs or Semi-Annual Certifications. The total amountpaid to contracted employees was $51,644. This amount was considered questioned costs.The lack of internal controls and noncompliance were systemic issues throughout the audit period.CriteriaCFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring 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 thataccurately reflect the work performed. These records must:(i) Be supported by a system of internal control which provides reasonableassurance 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 bythe non-Federal entity, not exceeding 100% of compensated activities . . .(vii) Support the distribution of the employee's salary or wages among specificactivities or cost objectives if the employee works on more than one Federal award; aFederal award and non-Federal award; an indirect cost activity and a direct costactivity; two or more indirect activities which are allocated using different allocationbases; or an unallowable activity and a direct or indirect cost activity. . . ."CauseManagement had not developed a system of internal controls that would have ensured compliancewith the Allowable Costs/Cost Principles compliance requirement.EffectThe failure to establish an effective internal control system enabled material noncompliance to goundetected. Noncompliance with the grant agreement and the Allowable Costs/Cost Principles compliancerequirement could have resulted in the loss of federal funds to the School Corporation.Questioned CostsQuestioned costs of $51,644 were identified, as described in the Condition and Context.RecommendationWe recommended that the School Corporation's management establish a system of internal controlsto ensure compliance and comply with the grant agreement and the Allowable Costs/Cost Principlescompliance requirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.