Department of the Treasury FFAL #21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Applicable Federal Award Number and Year – SLFRP0515 for 2021 Subrecipient Monitoring Material Weakness in Internal Control Over Compliance and Material Noncompliance Criteria: 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 conditions of the federal award. Condition: The subrecipient agreement requires the submission of quarterly performance reports by the subrecipient within fifteen days of quarter end. However, no quarterly performance reports were submitted by the subrecipient for the year ended June 30, 2024, as of August 1, 2024. Cause: The County did not have an internal control process in place to ensure the quarterly performance reports were received by the subrecipient timely. Effect: Without the timely submission of the quarterly performance reports by the subrecipient and review of those reports by the County, there is a greater possibility of ineligible expenditures. Questioned Costs: None reported. Context: No sampling was used. There was only one subrecipient during the year ended June 30, 2024 and it was selected for testing. Repeat Finding from Prior Years: No Recommendation: We recommend the County implement a control process which ensures quarterly performance reports are received by the subrecipient timely and that those reports are reviewed and approved by County personnel. Views of Responsible Officials: Dubuque County acknowledges the comment and has implemented a process to receive and review quarterly performance reports from the subrecipient.
Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Numbers: 10.553, 10.555, 10.559, 10.582 Federal Award Identification Number and Year: None Provided Pass-Through Agency: Maryland Department of Education (MSDE) Pass-Through Number(s): None Provided Award Period: 7/1/2023–6/30/2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.327. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. Small purchase procedures are used for purchases that exceed the micro-purchase amount but do not exceed the simplified acquisition threshold ($250,000). If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources (2 CFR section 200.320(b)). Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During the testing of ten contracts, the Board was unable to provide documentation for one contract to demonstrate compliance with their procurement policy, specifically the requirement to obtain two quotes for a small purchase. Questioned costs: Undetermined. Cause: Controls were not operating effectively to ensure that the Board’s procurement policies were followed for contracts entered into where expenses were charged to the federal program. Effect: There is an increased risk of charging unallowed costs to the program. Repeat Finding: No. Recommendation: We recommend that the Board enhance controls and procedures to ensure that it follows its procurement policies for all goods and services charged to the program. Documentation should be readily available for audit. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Numbers: 10.553, 10.555, 10.559, 10.582 Federal Award Identification Number and Year: None Provided Pass-Through Agency: Maryland Department of Education (MSDE) Pass-Through Number(s): None Provided Award Period: 7/1/2023–6/30/2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.327. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. Small purchase procedures are used for purchases that exceed the micro-purchase amount but do not exceed the simplified acquisition threshold ($250,000). If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources (2 CFR section 200.320(b)). Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During the testing of ten contracts, the Board was unable to provide documentation for one contract to demonstrate compliance with their procurement policy, specifically the requirement to obtain two quotes for a small purchase. Questioned costs: Undetermined. Cause: Controls were not operating effectively to ensure that the Board’s procurement policies were followed for contracts entered into where expenses were charged to the federal program. Effect: There is an increased risk of charging unallowed costs to the program. Repeat Finding: No. Recommendation: We recommend that the Board enhance controls and procedures to ensure that it follows its procurement policies for all goods and services charged to the program. Documentation should be readily available for audit. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Numbers: 10.553, 10.555, 10.559, 10.582 Federal Award Identification Number and Year: None Provided Pass-Through Agency: Maryland Department of Education (MSDE) Pass-Through Number(s): None Provided Award Period: 7/1/2023–6/30/2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.327. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. Small purchase procedures are used for purchases that exceed the micro-purchase amount but do not exceed the simplified acquisition threshold ($250,000). If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources (2 CFR section 200.320(b)). Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During the testing of ten contracts, the Board was unable to provide documentation for one contract to demonstrate compliance with their procurement policy, specifically the requirement to obtain two quotes for a small purchase. Questioned costs: Undetermined. Cause: Controls were not operating effectively to ensure that the Board’s procurement policies were followed for contracts entered into where expenses were charged to the federal program. Effect: There is an increased risk of charging unallowed costs to the program. Repeat Finding: No. Recommendation: We recommend that the Board enhance controls and procedures to ensure that it follows its procurement policies for all goods and services charged to the program. Documentation should be readily available for audit. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Numbers: 10.553, 10.555, 10.559, 10.582 Federal Award Identification Number and Year: None Provided Pass-Through Agency: Maryland Department of Education (MSDE) Pass-Through Number(s): None Provided Award Period: 7/1/2023–6/30/2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.327. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. Small purchase procedures are used for purchases that exceed the micro-purchase amount but do not exceed the simplified acquisition threshold ($250,000). If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources (2 CFR section 200.320(b)). Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During the testing of ten contracts, the Board was unable to provide documentation for one contract to demonstrate compliance with their procurement policy, specifically the requirement to obtain two quotes for a small purchase. Questioned costs: Undetermined. Cause: Controls were not operating effectively to ensure that the Board’s procurement policies were followed for contracts entered into where expenses were charged to the federal program. Effect: There is an increased risk of charging unallowed costs to the program. Repeat Finding: No. Recommendation: We recommend that the Board enhance controls and procedures to ensure that it follows its procurement policies for all goods and services charged to the program. Documentation should be readily available for audit. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Numbers: 10.553, 10.555, 10.559, 10.582 Federal Award Identification Number and Year: None Provided Pass-Through Agency: Maryland Department of Education (MSDE) Pass-Through Number(s): None Provided Award Period: 7/1/2023–6/30/2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.327. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. Small purchase procedures are used for purchases that exceed the micro-purchase amount but do not exceed the simplified acquisition threshold ($250,000). If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources (2 CFR section 200.320(b)). Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During the testing of ten contracts, the Board was unable to provide documentation for one contract to demonstrate compliance with their procurement policy, specifically the requirement to obtain two quotes for a small purchase. Questioned costs: Undetermined. Cause: Controls were not operating effectively to ensure that the Board’s procurement policies were followed for contracts entered into where expenses were charged to the federal program. Effect: There is an increased risk of charging unallowed costs to the program. Repeat Finding: No. Recommendation: We recommend that the Board enhance controls and procedures to ensure that it follows its procurement policies for all goods and services charged to the program. Documentation should be readily available for audit. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Numbers: 10.553, 10.555, 10.559, 10.582 Federal Award Identification Number and Year: None Provided Pass-Through Agency: Maryland Department of Education (MSDE) Pass-Through Number(s): None Provided Award Period: 7/1/2023–6/30/2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.327. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. Small purchase procedures are used for purchases that exceed the micro-purchase amount but do not exceed the simplified acquisition threshold ($250,000). If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources (2 CFR section 200.320(b)). Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During the testing of ten contracts, the Board was unable to provide documentation for one contract to demonstrate compliance with their procurement policy, specifically the requirement to obtain two quotes for a small purchase. Questioned costs: Undetermined. Cause: Controls were not operating effectively to ensure that the Board’s procurement policies were followed for contracts entered into where expenses were charged to the federal program. Effect: There is an increased risk of charging unallowed costs to the program. Repeat Finding: No. Recommendation: We recommend that the Board enhance controls and procedures to ensure that it follows its procurement policies for all goods and services charged to the program. Documentation should be readily available for audit. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Numbers: 10.553, 10.555, 10.559, 10.582 Federal Award Identification Number and Year: None Provided Pass-Through Agency: Maryland Department of Education (MSDE) Pass-Through Number(s): None Provided Award Period: 7/1/2023–6/30/2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.327. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200. Small purchase procedures are used for purchases that exceed the micro-purchase amount but do not exceed the simplified acquisition threshold ($250,000). If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources (2 CFR section 200.320(b)). Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: During the testing of ten contracts, the Board was unable to provide documentation for one contract to demonstrate compliance with their procurement policy, specifically the requirement to obtain two quotes for a small purchase. Questioned costs: Undetermined. Cause: Controls were not operating effectively to ensure that the Board’s procurement policies were followed for contracts entered into where expenses were charged to the federal program. Effect: There is an increased risk of charging unallowed costs to the program. Repeat Finding: No. Recommendation: We recommend that the Board enhance controls and procedures to ensure that it follows its procurement policies for all goods and services charged to the program. Documentation should be readily available for audit. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Education Federal Program Name: Title I Grants to Local Educational Agencies Assistance Listing Number: 84.010 Federal Award Identification Numbers and Year: S010A230020 and S010A220020 Pass-Through Agency: Maryland Department of Education (MSDE) Pass-Through Number(s): 241282-01 231095-01 Award Period: 7/1/2022–9/30/2024 7/1/2023–9/30/2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: Per 2 CFR Section 200.430 (8)(i) Standards for Documentation of Personnel Expenses states that: Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass both federally assisted, and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity's written policy; (v) Comply with the established accounting policies and practices of the non-Federal entity; (vii) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: For one of forty timesheets selected for testing, the Board was unable to provide documentation to substantiate that the time and effort was dedicated to the federal program. The Board did not have effective controls in place for monitoring and obtaining adequate support to validate actual payroll expenses charged to the federal program. Questioned costs: $3,415 Cause: Controls were not operating effectively to ensure that time and effort reporting was performed and documented in a timely manner, in accordance with federal requirements. Effect: There is an increased risk of charging unallowed payroll costs to the program. Repeat Finding: No. Recommendation: We recommend that the Board reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Board should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program. Documentation should be readily available for audit. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Education Federal Program Name: Title I Grants to Local Educational Agencies Assistance Listing Number: 84.010 Federal Award Identification Numbers and Year: S010A230020 and S010A220020 Pass-Through Agency: Maryland Department of Education (MSDE) Pass-Through Number(s): 241282-01 231095-01 Award Period: 7/1/2022–9/30/2024 7/1/2023–9/30/2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: Per 2 CFR Section 200.430 (8)(i) Standards for Documentation of Personnel Expenses states that: Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass both federally assisted, and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity's written policy; (v) Comply with the established accounting policies and practices of the non-Federal entity; (vii) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: For one of forty timesheets selected for testing, the Board was unable to provide documentation to substantiate that the time and effort was dedicated to the federal program. The Board did not have effective controls in place for monitoring and obtaining adequate support to validate actual payroll expenses charged to the federal program. Questioned costs: $3,415 Cause: Controls were not operating effectively to ensure that time and effort reporting was performed and documented in a timely manner, in accordance with federal requirements. Effect: There is an increased risk of charging unallowed payroll costs to the program. Repeat Finding: No. Recommendation: We recommend that the Board reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Board should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program. Documentation should be readily available for audit. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Education Federal Program Name: Title I Grants to Local Educational Agencies Assistance Listing Number: 84.010 Federal Award Identification Number and Year: S010A210020 S010A220020 S010A230020 S010A220020 S010A210020 S010A220020 S010A230020 Pass-Through Agency: Maryland Department of Education (MSDE) Pass-Through Number(s): 221499-01 231095-01 241282-01 231255-01 232028-01 231992-01 241671-01 Award Period: 7/1/2021–9/30/2023 7/1/2022–9/30/2024 7/1/2023–9/30/2024 7/1/2022–9/30/2024 3/1/2023–9/30/2023 3/1/2023–9/30/2024 7/1/2023–9/30/2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: Per ESEA sections 1111(h)(1)(C)(iii)(II) and 8101(23), (25) (20 USC 6311(h)(1)(C)(iii)(II) and 7801(23), (25))), in order to remove a student from the cohort, a school or LEA must confirm, in writing, that the student transferred out, emigrated to another country, transferred to a prison or juvenile facility, or is deceased. To confirm that a student transferred out, the school or LEA must have official written documentation that the student enrolled in another school or in an educational program that culminates in the award of a regular high school diploma. A student who is retained in grade, enrolls in a GED program, or leaves school for any other reason may not be counted as having transferred out for the purpose of calculating graduation rate and must remain in the adjusted cohort. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: For six out of eighteen samples tested, the Board did not maintain documentation to support the students’ withdrawal and/or evidence of the school’s review and approval of the student’s withdrawal that was reported to Maryland State Department of Education (MSDE). MSDE requires the Board to provide data for students that no longer attend a school in the district. The data is used to determine if the Board's graduation rate is affected because of the student’s departure. Questioned costs: Undeterminable. Cause: The Board did not retain documentation supporting student withdrawal codes as required by the grant. Effect: The Board's graduation rate may be improperly calculated if the data provided to the State is inaccurate. Repeat Finding: Yes, refer to prior year finding 2023-004. Recommendation: We recommend that the Board continue with established policies and procedures implemented in October 2023 to ensure that it obtains documentation to support student withdrawals and that this documentation is available for audit purposes. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Education Federal Program Name: Title I Grants to Local Educational Agencies Assistance Listing Number: 84.010 Federal Award Identification Number and Year: S010A210020 S010A220020 S010A230020 S010A220020 S010A210020 S010A220020 S010A230020 Pass-Through Agency: Maryland Department of Education (MSDE) Pass-Through Number(s): 221499-01 231095-01 241282-01 231255-01 232028-01 231992-01 241671-01 Award Period: 7/1/2021–9/30/2023 7/1/2022–9/30/2024 7/1/2023–9/30/2024 7/1/2022–9/30/2024 3/1/2023–9/30/2023 3/1/2023–9/30/2024 7/1/2023–9/30/2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: Per ESEA sections 1111(h)(1)(C)(iii)(II) and 8101(23), (25) (20 USC 6311(h)(1)(C)(iii)(II) and 7801(23), (25))), in order to remove a student from the cohort, a school or LEA must confirm, in writing, that the student transferred out, emigrated to another country, transferred to a prison or juvenile facility, or is deceased. To confirm that a student transferred out, the school or LEA must have official written documentation that the student enrolled in another school or in an educational program that culminates in the award of a regular high school diploma. A student who is retained in grade, enrolls in a GED program, or leaves school for any other reason may not be counted as having transferred out for the purpose of calculating graduation rate and must remain in the adjusted cohort. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: For six out of eighteen samples tested, the Board did not maintain documentation to support the students’ withdrawal and/or evidence of the school’s review and approval of the student’s withdrawal that was reported to Maryland State Department of Education (MSDE). MSDE requires the Board to provide data for students that no longer attend a school in the district. The data is used to determine if the Board's graduation rate is affected because of the student’s departure. Questioned costs: Undeterminable. Cause: The Board did not retain documentation supporting student withdrawal codes as required by the grant. Effect: The Board's graduation rate may be improperly calculated if the data provided to the State is inaccurate. Repeat Finding: Yes, refer to prior year finding 2023-004. Recommendation: We recommend that the Board continue with established policies and procedures implemented in October 2023 to ensure that it obtains documentation to support student withdrawals and that this documentation is available for audit purposes. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Education Federal Program Name: Title I Grants to Local Educational Agencies Assistance Listing Number: 84.010 Federal Award Identification Number and Year: S010A210020 S010A220020 S010A230020 S010A220020 S010A210020 S010A220020 S010A230020 Pass-Through Agency: Maryland Department of Education (MSDE) Pass-Through Number(s): 221499-01 231095-01 241282-01 231255-01 232028-01 231992-01 241671-01 Award Period: 7/1/2021–9/30/2023 7/1/2022–9/30/2024 7/1/2023–9/30/2024 7/1/2022–9/30/2024 3/1/2023–9/30/2023 3/1/2023–9/30/2024 7/1/2023–9/30/2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: Per ESEA sections 1111(h)(1)(C)(iii)(II) and 8101(23), (25) (20 USC 6311(h)(1)(C)(iii)(II) and 7801(23), (25))), in order to remove a student from the cohort, a school or LEA must confirm, in writing, that the student transferred out, emigrated to another country, transferred to a prison or juvenile facility, or is deceased. To confirm that a student transferred out, the school or LEA must have official written documentation that the student enrolled in another school or in an educational program that culminates in the award of a regular high school diploma. A student who is retained in grade, enrolls in a GED program, or leaves school for any other reason may not be counted as having transferred out for the purpose of calculating graduation rate and must remain in the adjusted cohort. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: For six out of eighteen samples tested, the Board did not maintain documentation to support the students’ withdrawal and/or evidence of the school’s review and approval of the student’s withdrawal that was reported to Maryland State Department of Education (MSDE). MSDE requires the Board to provide data for students that no longer attend a school in the district. The data is used to determine if the Board's graduation rate is affected because of the student’s departure. Questioned costs: Undeterminable. Cause: The Board did not retain documentation supporting student withdrawal codes as required by the grant. Effect: The Board's graduation rate may be improperly calculated if the data provided to the State is inaccurate. Repeat Finding: Yes, refer to prior year finding 2023-004. Recommendation: We recommend that the Board continue with established policies and procedures implemented in October 2023 to ensure that it obtains documentation to support student withdrawals and that this documentation is available for audit purposes. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Education Federal Program Name: Title I Grants to Local Educational Agencies Assistance Listing Number: 84.010 Federal Award Identification Number and Year: S010A210020 S010A220020 S010A230020 S010A220020 S010A210020 S010A220020 S010A230020 Pass-Through Agency: Maryland Department of Education (MSDE) Pass-Through Number(s): 221499-01 231095-01 241282-01 231255-01 232028-01 231992-01 241671-01 Award Period: 7/1/2021–9/30/2023 7/1/2022–9/30/2024 7/1/2023–9/30/2024 7/1/2022–9/30/2024 3/1/2023–9/30/2023 3/1/2023–9/30/2024 7/1/2023–9/30/2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: Per ESEA sections 1111(h)(1)(C)(iii)(II) and 8101(23), (25) (20 USC 6311(h)(1)(C)(iii)(II) and 7801(23), (25))), in order to remove a student from the cohort, a school or LEA must confirm, in writing, that the student transferred out, emigrated to another country, transferred to a prison or juvenile facility, or is deceased. To confirm that a student transferred out, the school or LEA must have official written documentation that the student enrolled in another school or in an educational program that culminates in the award of a regular high school diploma. A student who is retained in grade, enrolls in a GED program, or leaves school for any other reason may not be counted as having transferred out for the purpose of calculating graduation rate and must remain in the adjusted cohort. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: For six out of eighteen samples tested, the Board did not maintain documentation to support the students’ withdrawal and/or evidence of the school’s review and approval of the student’s withdrawal that was reported to Maryland State Department of Education (MSDE). MSDE requires the Board to provide data for students that no longer attend a school in the district. The data is used to determine if the Board's graduation rate is affected because of the student’s departure. Questioned costs: Undeterminable. Cause: The Board did not retain documentation supporting student withdrawal codes as required by the grant. Effect: The Board's graduation rate may be improperly calculated if the data provided to the State is inaccurate. Repeat Finding: Yes, refer to prior year finding 2023-004. Recommendation: We recommend that the Board continue with established policies and procedures implemented in October 2023 to ensure that it obtains documentation to support student withdrawals and that this documentation is available for audit purposes. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Education Federal Program Name: Title I Grants to Local Educational Agencies Assistance Listing Number: 84.010 Federal Award Identification Number and Year: S010A210020 S010A220020 S010A230020 S010A220020 S010A210020 S010A220020 S010A230020 Pass-Through Agency: Maryland Department of Education (MSDE) Pass-Through Number(s): 221499-01 231095-01 241282-01 231255-01 232028-01 231992-01 241671-01 Award Period: 7/1/2021–9/30/2023 7/1/2022–9/30/2024 7/1/2023–9/30/2024 7/1/2022–9/30/2024 3/1/2023–9/30/2023 3/1/2023–9/30/2024 7/1/2023–9/30/2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: Per ESEA sections 1111(h)(1)(C)(iii)(II) and 8101(23), (25) (20 USC 6311(h)(1)(C)(iii)(II) and 7801(23), (25))), in order to remove a student from the cohort, a school or LEA must confirm, in writing, that the student transferred out, emigrated to another country, transferred to a prison or juvenile facility, or is deceased. To confirm that a student transferred out, the school or LEA must have official written documentation that the student enrolled in another school or in an educational program that culminates in the award of a regular high school diploma. A student who is retained in grade, enrolls in a GED program, or leaves school for any other reason may not be counted as having transferred out for the purpose of calculating graduation rate and must remain in the adjusted cohort. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: For six out of eighteen samples tested, the Board did not maintain documentation to support the students’ withdrawal and/or evidence of the school’s review and approval of the student’s withdrawal that was reported to Maryland State Department of Education (MSDE). MSDE requires the Board to provide data for students that no longer attend a school in the district. The data is used to determine if the Board's graduation rate is affected because of the student’s departure. Questioned costs: Undeterminable. Cause: The Board did not retain documentation supporting student withdrawal codes as required by the grant. Effect: The Board's graduation rate may be improperly calculated if the data provided to the State is inaccurate. Repeat Finding: Yes, refer to prior year finding 2023-004. Recommendation: We recommend that the Board continue with established policies and procedures implemented in October 2023 to ensure that it obtains documentation to support student withdrawals and that this documentation is available for audit purposes. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Education Federal Program Name: Title I Grants to Local Educational Agencies Assistance Listing Number: 84.010 Federal Award Identification Number and Year: S010A210020 S010A220020 S010A230020 S010A220020 S010A210020 S010A220020 S010A230020 Pass-Through Agency: Maryland Department of Education (MSDE) Pass-Through Number(s): 221499-01 231095-01 241282-01 231255-01 232028-01 231992-01 241671-01 Award Period: 7/1/2021–9/30/2023 7/1/2022–9/30/2024 7/1/2023–9/30/2024 7/1/2022–9/30/2024 3/1/2023–9/30/2023 3/1/2023–9/30/2024 7/1/2023–9/30/2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: Per ESEA sections 1111(h)(1)(C)(iii)(II) and 8101(23), (25) (20 USC 6311(h)(1)(C)(iii)(II) and 7801(23), (25))), in order to remove a student from the cohort, a school or LEA must confirm, in writing, that the student transferred out, emigrated to another country, transferred to a prison or juvenile facility, or is deceased. To confirm that a student transferred out, the school or LEA must have official written documentation that the student enrolled in another school or in an educational program that culminates in the award of a regular high school diploma. A student who is retained in grade, enrolls in a GED program, or leaves school for any other reason may not be counted as having transferred out for the purpose of calculating graduation rate and must remain in the adjusted cohort. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: For six out of eighteen samples tested, the Board did not maintain documentation to support the students’ withdrawal and/or evidence of the school’s review and approval of the student’s withdrawal that was reported to Maryland State Department of Education (MSDE). MSDE requires the Board to provide data for students that no longer attend a school in the district. The data is used to determine if the Board's graduation rate is affected because of the student’s departure. Questioned costs: Undeterminable. Cause: The Board did not retain documentation supporting student withdrawal codes as required by the grant. Effect: The Board's graduation rate may be improperly calculated if the data provided to the State is inaccurate. Repeat Finding: Yes, refer to prior year finding 2023-004. Recommendation: We recommend that the Board continue with established policies and procedures implemented in October 2023 to ensure that it obtains documentation to support student withdrawals and that this documentation is available for audit purposes. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Education Federal Program Name: Title I Grants to Local Educational Agencies Assistance Listing Number: 84.010 Federal Award Identification Number and Year: S010A210020 S010A220020 S010A230020 S010A220020 S010A210020 S010A220020 S010A230020 Pass-Through Agency: Maryland Department of Education (MSDE) Pass-Through Number(s): 221499-01 231095-01 241282-01 231255-01 232028-01 231992-01 241671-01 Award Period: 7/1/2021–9/30/2023 7/1/2022–9/30/2024 7/1/2023–9/30/2024 7/1/2022–9/30/2024 3/1/2023–9/30/2023 3/1/2023–9/30/2024 7/1/2023–9/30/2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: Per ESEA sections 1111(h)(1)(C)(iii)(II) and 8101(23), (25) (20 USC 6311(h)(1)(C)(iii)(II) and 7801(23), (25))), in order to remove a student from the cohort, a school or LEA must confirm, in writing, that the student transferred out, emigrated to another country, transferred to a prison or juvenile facility, or is deceased. To confirm that a student transferred out, the school or LEA must have official written documentation that the student enrolled in another school or in an educational program that culminates in the award of a regular high school diploma. A student who is retained in grade, enrolls in a GED program, or leaves school for any other reason may not be counted as having transferred out for the purpose of calculating graduation rate and must remain in the adjusted cohort. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: For six out of eighteen samples tested, the Board did not maintain documentation to support the students’ withdrawal and/or evidence of the school’s review and approval of the student’s withdrawal that was reported to Maryland State Department of Education (MSDE). MSDE requires the Board to provide data for students that no longer attend a school in the district. The data is used to determine if the Board's graduation rate is affected because of the student’s departure. Questioned costs: Undeterminable. Cause: The Board did not retain documentation supporting student withdrawal codes as required by the grant. Effect: The Board's graduation rate may be improperly calculated if the data provided to the State is inaccurate. Repeat Finding: Yes, refer to prior year finding 2023-004. Recommendation: We recommend that the Board continue with established policies and procedures implemented in October 2023 to ensure that it obtains documentation to support student withdrawals and that this documentation is available for audit purposes. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Education Federal Program Name: Title III English Language Acquisition State Grant Assistance Listing Number: 84.365 Federal Award Identification Number and Year: S365A220020 Pass-Through Agency: Maryland Department of Education (MSDE) Pass-Through Number(s): 241230-02 Award Period: 7/1/2022–9/30/2024 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: Per 2 CFR Section 200.430 (8)(i) Standards for Documentation of Personnel Expenses states that: Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (vi) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (vii) Be incorporated into the official records of the non-Federal entity; (viii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (ix) Encompass both federally assisted, and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity's written policy; (x) Comply with the established accounting policies and practices of the non-Federal entity; (viii) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: For three of forty timesheets selected for testing, the Board was unable to provide documentation to substantiate that the time and effort was dedicated to the federal program. The Board did not have effective controls in place for monitoring and obtaining adequate support to validate actual payroll expenses charged to the federal program. Questioned costs: $15,233 Cause: Controls were not operating effectively to ensure that time and effort reporting was performed and documented in a timely manner, in accordance with federal requirements. Effect: There is an increased risk of charging unallowed payroll costs to the program. Repeat Finding: No. Recommendation: We recommend that the Board reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Board should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program. Documentation should be readily available for audit. Views of responsible officials: There is no disagreement with the audit finding.
Assistance Listing Number, Federal Agency, and Program Name - 84.007, 84.063, 84.268; U.S. Department of Education; Federal Supplemental Educational Opportunity Grants, Federal Pell Grant Program, Federal Direct Student Loans Federal Award Identification Number and Year - P007A236053, P063P232857, P268K242857; 2023-2024 Pass through Entity - N/A Finding Type - Material weakness Repeat Finding - No Criteria - In accordance with 2 CFR 200.303, the College must establish and maintain effective internal control over its federal awards in order to provide reasonable assurance that it is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Specific to these Title IV programs, 34 CFR 668.22 outlines the requirements for insitutions to follow when returns of Title IV funds are required, including identifying when calculations are necessary and the time frame in which they are required to be returned. Condition - There was a lack of internal controls in place related to the return of Title IV funds. Questioned Costs - N/A Identification of How Questioned Costs Were Computed - N/A Context - Once return calculations were identified and calculated, there were no controls in place to ensure that the calculations were complete, accurate, or returned in a timely manner. Cause and Effect - A lack of review of the processes to identify students who required a calculation, the completed calculations for accuracy, or ensure that that all calculated returns were completed could lead to incomplete calculations, inaccurate calculations, or untimely return of funds once they are identified. Recommendation - We recommend that the College implement a review control that would cover each stage of the return process outlined. Views of Responsible Officials and Corrective Action Plan - The College will implement controls related to returns of Title IV funds to ensure the related calculations are complete and accurate and that the funds are returned in a timely manner.
Assistance Listing Number, Federal Agency, and Program Name - 84.007, 84.063, 84.268; U.S. Department of Education; Federal Supplemental Educational Opportunity Grants, Federal Pell Grant Program, Federal Direct Student Loans Federal Award Identification Number and Year - P007A236053, P063P232857, P268K242857; 2023-2024 Pass through Entity - N/A Finding Type - Material weakness Repeat Finding - No Criteria - In accordance with 2 CFR 200.303, the College must establish and maintain effective internal control over its federal awards in order to provide reasonable assurance that it is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Specific to these Title IV programs, 34 CFR 668.22 outlines the requirements for insitutions to follow when returns of Title IV funds are required, including identifying when calculations are necessary and the time frame in which they are required to be returned. Condition - There was a lack of internal controls in place related to the return of Title IV funds. Questioned Costs - N/A Identification of How Questioned Costs Were Computed - N/A Context - Once return calculations were identified and calculated, there were no controls in place to ensure that the calculations were complete, accurate, or returned in a timely manner. Cause and Effect - A lack of review of the processes to identify students who required a calculation, the completed calculations for accuracy, or ensure that that all calculated returns were completed could lead to incomplete calculations, inaccurate calculations, or untimely return of funds once they are identified. Recommendation - We recommend that the College implement a review control that would cover each stage of the return process outlined. Views of Responsible Officials and Corrective Action Plan - The College will implement controls related to returns of Title IV funds to ensure the related calculations are complete and accurate and that the funds are returned in a timely manner.
Assistance Listing Number, Federal Agency, and Program Name - 84.007, 84.063, 84.268; U.S. Department of Education; Federal Supplemental Educational Opportunity Grants, Federal Pell Grant Program, Federal Direct Student Loans Federal Award Identification Number and Year - P007A236053, P063P232857, P268K242857; 2023-2024 Pass through Entity - N/A Finding Type - Material weakness Repeat Finding - No Criteria - In accordance with 2 CFR 200.303, the College must establish and maintain effective internal control over its federal awards in order to provide reasonable assurance that it is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Specific to these Title IV programs, 34 CFR 668.22 outlines the requirements for insitutions to follow when returns of Title IV funds are required, including identifying when calculations are necessary and the time frame in which they are required to be returned. Condition - There was a lack of internal controls in place related to the return of Title IV funds. Questioned Costs - N/A Identification of How Questioned Costs Were Computed - N/A Context - Once return calculations were identified and calculated, there were no controls in place to ensure that the calculations were complete, accurate, or returned in a timely manner. Cause and Effect - A lack of review of the processes to identify students who required a calculation, the completed calculations for accuracy, or ensure that that all calculated returns were completed could lead to incomplete calculations, inaccurate calculations, or untimely return of funds once they are identified. Recommendation - We recommend that the College implement a review control that would cover each stage of the return process outlined. Views of Responsible Officials and Corrective Action Plan - The College will implement controls related to returns of Title IV funds to ensure the related calculations are complete and accurate and that the funds are returned in a timely manner.
Assistance Listing Number, Federal Agency, and Program Name - 84.007, 84.033; U.S. Department of Education; Federal Supplemental Educational Opportunity Grants (FSEOG), Federal Work-Study Program (FWS) Federal Award Identification Number and Year - P007A236053, P033A236053; 2023-2024 Pass through Entity - N/A Finding Type - Material weakness Repeat Finding - No Criteria - In accordance with 2 CFR 200.303, the College must establish and maintain effective internal controls over its federal awards in order to provide reasonable assurance that it is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Specific to these Title IV programs, 34 CFR 675.19(b)(3) (FWS) and 34 CFR 676.19(b)(3) (FSEOG) outline the requirement for institutions to submit a Fiscal Operations Report (FISAP). Condition - There was a lack of internal controls in place related to the review of the FISAP that was submitted by the College in September 2023. Questioned Costs - N/A Identification of How Questioned Costs Were Computed - N/A Context - Once the FISAP was prepared, there was no control in place ensure that the information included in the report was accurate. Cause and Effect - A lack of review of the completed report prior to submission could lead to inaccurate information being reported to the U.S. Department of Education. Recommendation - We recommend that the College implement a level of review of the report prior to submission. Views of Responsible Officials and Planned Corrective Actions - The College will establish the proper controls to ensure that the information included in the FISAP is accurate, including implementing an additional level of review of the report.
Assistance Listing Number, Federal Agency, and Program Name - 84.007, 84.033; U.S. Department of Education; Federal Supplemental Educational Opportunity Grants (FSEOG), Federal Work-Study Program (FWS) Federal Award Identification Number and Year - P007A236053, P033A236053; 2023-2024 Pass through Entity - N/A Finding Type - Material weakness Repeat Finding - No Criteria - In accordance with 2 CFR 200.303, the College must establish and maintain effective internal controls over its federal awards in order to provide reasonable assurance that it is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Specific to these Title IV programs, 34 CFR 675.19(b)(3) (FWS) and 34 CFR 676.19(b)(3) (FSEOG) outline the requirement for institutions to submit a Fiscal Operations Report (FISAP). Condition - There was a lack of internal controls in place related to the review of the FISAP that was submitted by the College in September 2023. Questioned Costs - N/A Identification of How Questioned Costs Were Computed - N/A Context - Once the FISAP was prepared, there was no control in place ensure that the information included in the report was accurate. Cause and Effect - A lack of review of the completed report prior to submission could lead to inaccurate information being reported to the U.S. Department of Education. Recommendation - We recommend that the College implement a level of review of the report prior to submission. Views of Responsible Officials and Planned Corrective Actions - The College will establish the proper controls to ensure that the information included in the FISAP is accurate, including implementing an additional level of review of the report.
FINDING 2024-001 Information on the federal program: Subject: Child Nutrition Cluster - Internal Controls Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program Assistance Listing Number: 10.553, 10.555 Federal Award Numbers and Years (or Other Identifying Numbers): FY 22-23, FY 23-24 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Eligibility Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 7 CFR 245.3(c) sates in part: Each School Food Authority shall serve free and reduced price meals or free milk in the respective programs to children eligible under its eligibility criteria. Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the eligibility compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with eligibility requirements. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. Questioned Costs: There were no questioned costs identified. Context: During the testing of internal controls over eligibility determinations for free and reduced meals, we noted there was no formal review control in place. There is no documented, secondary review for the applications entered in the food service software which determines eligibility. Additionally, there was no documented review by School Corporation personnel of the Income Eligibility Guidelines used by the food service software which are updated on annual basis. Identification as a repeat finding, if applicable: No. Recommendation: We recommend that the School Corporation's management establish an internal control process to review the updates to the annual adjustments to the Income Eligibility Guidelines made to the food service software to determine eligibility to ensure updated guidelines are accurate and complete. This review should be documented on annual basis to confirm management’s oversight and monitoring of eligibility determinations. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
FINDING 2024-001 Information on the federal program: Subject: Child Nutrition Cluster - Internal Controls Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program Assistance Listing Number: 10.553, 10.555 Federal Award Numbers and Years (or Other Identifying Numbers): FY 22-23, FY 23-24 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Eligibility Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 7 CFR 245.3(c) sates in part: Each School Food Authority shall serve free and reduced price meals or free milk in the respective programs to children eligible under its eligibility criteria. Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the eligibility compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with eligibility requirements. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. Questioned Costs: There were no questioned costs identified. Context: During the testing of internal controls over eligibility determinations for free and reduced meals, we noted there was no formal review control in place. There is no documented, secondary review for the applications entered in the food service software which determines eligibility. Additionally, there was no documented review by School Corporation personnel of the Income Eligibility Guidelines used by the food service software which are updated on annual basis. Identification as a repeat finding, if applicable: No. Recommendation: We recommend that the School Corporation's management establish an internal control process to review the updates to the annual adjustments to the Income Eligibility Guidelines made to the food service software to determine eligibility to ensure updated guidelines are accurate and complete. This review should be documented on annual basis to confirm management’s oversight and monitoring of eligibility determinations. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
FINDING 2024-001 Information on the federal program: Subject: Child Nutrition Cluster - Internal Controls Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program Assistance Listing Number: 10.553, 10.555 Federal Award Numbers and Years (or Other Identifying Numbers): FY 22-23, FY 23-24 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Eligibility Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 7 CFR 245.3(c) sates in part: Each School Food Authority shall serve free and reduced price meals or free milk in the respective programs to children eligible under its eligibility criteria. Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the eligibility compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with eligibility requirements. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. Questioned Costs: There were no questioned costs identified. Context: During the testing of internal controls over eligibility determinations for free and reduced meals, we noted there was no formal review control in place. There is no documented, secondary review for the applications entered in the food service software which determines eligibility. Additionally, there was no documented review by School Corporation personnel of the Income Eligibility Guidelines used by the food service software which are updated on annual basis. Identification as a repeat finding, if applicable: No. Recommendation: We recommend that the School Corporation's management establish an internal control process to review the updates to the annual adjustments to the Income Eligibility Guidelines made to the food service software to determine eligibility to ensure updated guidelines are accurate and complete. This review should be documented on annual basis to confirm management’s oversight and monitoring of eligibility determinations. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
Assistance Listing, Federal Agency, and Program Name - 14.267, U.S. Department of Housing and Urban Development, Continuum of Care Program Federal Award Identification Number and Year - MI0429L5F012209, and MI0030L5F012215 (direct funded); 20230256-00, 20240559-00, MI0074L5F012114, and MI0074L5F012215 (pass-through funded) Pass through Entity - Michigan Department of Health and Human Services, Neighborhood Service Organization, and Detroit Wayne Integrated Health Network Finding Type - Material weakness Repeat Finding - No Criteria - Per 2 CFR 200.303(a), a non federal entity must establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should align with the guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition - The Organization lacked sufficient controls to ensure consistent reviews/approvals of monthly reimbursement requests and tenant rent calculations throughout the year. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - The review and approval of the monthly reimbursement requests and the tenant calculation serve to prevent and detect and correct noncompliance specific to the following compliance categories: period of performance, earmarking, program income and rent reasonableness. Each grant requests reimbursement for expenses incurred on a monthly basis. The review of the monthly reimbursement request, including supporting documentation, verifies that the costs are within the period of performance, administrative costs did not exceed 10 percent, and use of program income is consistent with grant terms. The review of the tenant rental calculations, including tenant rent calculation worksheet, verifies that the amount charged to participants is calculated and charged appropriately and the associated program income is identified and tracked appropriately. Based on the testing performed, the audit procedures identified that in 5 out of the 12 months there was not evidence of review for monthly reimbursement requests for one or more of the programs. Testing also identified that 4 out of a sample of 35 tenant rent calculations did not have evidence of review. Cause and Effect - The controls in place to ensure period of performance, earmarking, program income, and rent reasonableness are reviewed for completeness and accuracy were not in place. The lack of controls could result in an instance of noncompliance not being identified. Recommendation - We recommend the Organization ensure controls are in place to ensure the monthly reimbursement requests and the tenant rent calculations are reviewed for completeness and accuracy and for compliance with period of performance, earmarking, program income and rent reasonableness. Views of Responsible Officials and Corrective Action Plan - Effective immediately, the accounting director or rent analyst will review and approve the monthly reimbursement requests and rent calculations.
Assistance Listing, Federal Agency, and Program Name - 14.267, U.S. Department of Housing and Urban Development, Continuum of Care Program Federal Award Identification Number and Year - MI0429L5F012209, and MI0030L5F012215 (direct funded); 20230256-00, 20240559-00, MI0074L5F012114, and MI0074L5F012215 (pass-through funded) Pass through Entity - Michigan Department of Health and Human Services, Neighborhood Service Organization, and Detroit Wayne Integrated Health Network Finding Type - Material weakness Repeat Finding - No Criteria - Per 2 CFR 200.303(a), a non federal entity must establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should align with the guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition - The Organization lacked sufficient controls to ensure consistent reviews/approvals of monthly reimbursement requests and tenant rent calculations throughout the year. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - The review and approval of the monthly reimbursement requests and the tenant calculation serve to prevent and detect and correct noncompliance specific to the following compliance categories: period of performance, earmarking, program income and rent reasonableness. Each grant requests reimbursement for expenses incurred on a monthly basis. The review of the monthly reimbursement request, including supporting documentation, verifies that the costs are within the period of performance, administrative costs did not exceed 10 percent, and use of program income is consistent with grant terms. The review of the tenant rental calculations, including tenant rent calculation worksheet, verifies that the amount charged to participants is calculated and charged appropriately and the associated program income is identified and tracked appropriately. Based on the testing performed, the audit procedures identified that in 5 out of the 12 months there was not evidence of review for monthly reimbursement requests for one or more of the programs. Testing also identified that 4 out of a sample of 35 tenant rent calculations did not have evidence of review. Cause and Effect - The controls in place to ensure period of performance, earmarking, program income, and rent reasonableness are reviewed for completeness and accuracy were not in place. The lack of controls could result in an instance of noncompliance not being identified. Recommendation - We recommend the Organization ensure controls are in place to ensure the monthly reimbursement requests and the tenant rent calculations are reviewed for completeness and accuracy and for compliance with period of performance, earmarking, program income and rent reasonableness. Views of Responsible Officials and Corrective Action Plan - Effective immediately, the accounting director or rent analyst will review and approve the monthly reimbursement requests and rent calculations.
Assistance Listing, Federal Agency, and Program Name - 14.267, U.S. Department of Housing and Urban Development, Continuum of Care Program Federal Award Identification Number and Year - MI0429L5F012209, and MI0030L5F012215 (direct funded); 20230256-00, 20240559-00, MI0074L5F012114, and MI0074L5F012215 (pass-through funded) Pass through Entity - Michigan Department of Health and Human Services, Neighborhood Service Organization, and Detroit Wayne Integrated Health Network Finding Type - Material weakness Repeat Finding - No Criteria - Per 2 CFR 200.303(a), a non federal entity must establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should align with the guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition - The Organization lacked sufficient controls to ensure consistent reviews/approvals of monthly reimbursement requests and tenant rent calculations throughout the year. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - The review and approval of the monthly reimbursement requests and the tenant calculation serve to prevent and detect and correct noncompliance specific to the following compliance categories: period of performance, earmarking, program income and rent reasonableness. Each grant requests reimbursement for expenses incurred on a monthly basis. The review of the monthly reimbursement request, including supporting documentation, verifies that the costs are within the period of performance, administrative costs did not exceed 10 percent, and use of program income is consistent with grant terms. The review of the tenant rental calculations, including tenant rent calculation worksheet, verifies that the amount charged to participants is calculated and charged appropriately and the associated program income is identified and tracked appropriately. Based on the testing performed, the audit procedures identified that in 5 out of the 12 months there was not evidence of review for monthly reimbursement requests for one or more of the programs. Testing also identified that 4 out of a sample of 35 tenant rent calculations did not have evidence of review. Cause and Effect - The controls in place to ensure period of performance, earmarking, program income, and rent reasonableness are reviewed for completeness and accuracy were not in place. The lack of controls could result in an instance of noncompliance not being identified. Recommendation - We recommend the Organization ensure controls are in place to ensure the monthly reimbursement requests and the tenant rent calculations are reviewed for completeness and accuracy and for compliance with period of performance, earmarking, program income and rent reasonableness. Views of Responsible Officials and Corrective Action Plan - Effective immediately, the accounting director or rent analyst will review and approve the monthly reimbursement requests and rent calculations.
Assistance Listing, Federal Agency, and Program Name - 14.267, U.S. Department of Housing and Urban Development, Continuum of Care Program Federal Award Identification Number and Year - MI0429L5F012209, and MI0030L5F012215 (direct funded); 20230256-00, 20240559-00, MI0074L5F012114, and MI0074L5F012215 (pass-through funded) Pass through Entity - Michigan Department of Health and Human Services, Neighborhood Service Organization, and Detroit Wayne Integrated Health Network Finding Type - Material weakness Repeat Finding - No Criteria - Per 2 CFR 200.303(a), a non federal entity must establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should align with the guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition - The Organization lacked sufficient controls to ensure consistent reviews/approvals of monthly reimbursement requests and tenant rent calculations throughout the year. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - The review and approval of the monthly reimbursement requests and the tenant calculation serve to prevent and detect and correct noncompliance specific to the following compliance categories: period of performance, earmarking, program income and rent reasonableness. Each grant requests reimbursement for expenses incurred on a monthly basis. The review of the monthly reimbursement request, including supporting documentation, verifies that the costs are within the period of performance, administrative costs did not exceed 10 percent, and use of program income is consistent with grant terms. The review of the tenant rental calculations, including tenant rent calculation worksheet, verifies that the amount charged to participants is calculated and charged appropriately and the associated program income is identified and tracked appropriately. Based on the testing performed, the audit procedures identified that in 5 out of the 12 months there was not evidence of review for monthly reimbursement requests for one or more of the programs. Testing also identified that 4 out of a sample of 35 tenant rent calculations did not have evidence of review. Cause and Effect - The controls in place to ensure period of performance, earmarking, program income, and rent reasonableness are reviewed for completeness and accuracy were not in place. The lack of controls could result in an instance of noncompliance not being identified. Recommendation - We recommend the Organization ensure controls are in place to ensure the monthly reimbursement requests and the tenant rent calculations are reviewed for completeness and accuracy and for compliance with period of performance, earmarking, program income and rent reasonableness. Views of Responsible Officials and Corrective Action Plan - Effective immediately, the accounting director or rent analyst will review and approve the monthly reimbursement requests and rent calculations.
Assistance Listing, Federal Agency, and Program Name - 14.267, U.S. Department of Housing and Urban Development, Continuum of Care Program Federal Award Identification Number and Year - MI0429L5F012209, and MI0030L5F012215 (direct funded); 20230256-00, 20240559-00, MI0074L5F012114, and MI0074L5F012215 (pass-through funded) Pass through Entity - Michigan Department of Health and Human Services, Neighborhood Service Organization, and Detroit Wayne Integrated Health Network Finding Type - Material weakness Repeat Finding - No Criteria - Per 2 CFR 200.303(a), a non federal entity must establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should align with the guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition - The Organization lacked sufficient controls to ensure consistent reviews/approvals of monthly reimbursement requests and tenant rent calculations throughout the year. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - The review and approval of the monthly reimbursement requests and the tenant calculation serve to prevent and detect and correct noncompliance specific to the following compliance categories: period of performance, earmarking, program income and rent reasonableness. Each grant requests reimbursement for expenses incurred on a monthly basis. The review of the monthly reimbursement request, including supporting documentation, verifies that the costs are within the period of performance, administrative costs did not exceed 10 percent, and use of program income is consistent with grant terms. The review of the tenant rental calculations, including tenant rent calculation worksheet, verifies that the amount charged to participants is calculated and charged appropriately and the associated program income is identified and tracked appropriately. Based on the testing performed, the audit procedures identified that in 5 out of the 12 months there was not evidence of review for monthly reimbursement requests for one or more of the programs. Testing also identified that 4 out of a sample of 35 tenant rent calculations did not have evidence of review. Cause and Effect - The controls in place to ensure period of performance, earmarking, program income, and rent reasonableness are reviewed for completeness and accuracy were not in place. The lack of controls could result in an instance of noncompliance not being identified. Recommendation - We recommend the Organization ensure controls are in place to ensure the monthly reimbursement requests and the tenant rent calculations are reviewed for completeness and accuracy and for compliance with period of performance, earmarking, program income and rent reasonableness. Views of Responsible Officials and Corrective Action Plan - Effective immediately, the accounting director or rent analyst will review and approve the monthly reimbursement requests and rent calculations.
Assistance Listing, Federal Agency, and Program Name - 14.267, U.S. Department of Housing and Urban Development, Continuum of Care Program Federal Award Identification Number and Year - MI0429L5F012209, and MI0030L5F012215 (direct funded); 20230256-00, 20240559-00, MI0074L5F012114, and MI0074L5F012215 (pass-through funded) Pass through Entity - Michigan Department of Health and Human Services, Neighborhood Service Organization, and Detroit Wayne Integrated Health Network Finding Type - Material weakness Repeat Finding - No Criteria - Per 2 CFR 200.303(a), a non federal entity must establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should align with the guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition - The Organization lacked sufficient controls to ensure consistent reviews/approvals of monthly reimbursement requests and tenant rent calculations throughout the year. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - The review and approval of the monthly reimbursement requests and the tenant calculation serve to prevent and detect and correct noncompliance specific to the following compliance categories: period of performance, earmarking, program income and rent reasonableness. Each grant requests reimbursement for expenses incurred on a monthly basis. The review of the monthly reimbursement request, including supporting documentation, verifies that the costs are within the period of performance, administrative costs did not exceed 10 percent, and use of program income is consistent with grant terms. The review of the tenant rental calculations, including tenant rent calculation worksheet, verifies that the amount charged to participants is calculated and charged appropriately and the associated program income is identified and tracked appropriately. Based on the testing performed, the audit procedures identified that in 5 out of the 12 months there was not evidence of review for monthly reimbursement requests for one or more of the programs. Testing also identified that 4 out of a sample of 35 tenant rent calculations did not have evidence of review. Cause and Effect - The controls in place to ensure period of performance, earmarking, program income, and rent reasonableness are reviewed for completeness and accuracy were not in place. The lack of controls could result in an instance of noncompliance not being identified. Recommendation - We recommend the Organization ensure controls are in place to ensure the monthly reimbursement requests and the tenant rent calculations are reviewed for completeness and accuracy and for compliance with period of performance, earmarking, program income and rent reasonableness. Views of Responsible Officials and Corrective Action Plan - Effective immediately, the accounting director or rent analyst will review and approve the monthly reimbursement requests and rent calculations.
Assistance Listing, Federal Agency, and Program Name - 14.267, U.S. Department of Housing and Urban Development, Continuum of Care Program Federal Award Identification Number and Year - MI0429L5F012209, and MI0030L5F012215 (direct funded); 20230256-00, 20240559-00, MI0074L5F012114, and MI0074L5F012215 (pass-through funded) Pass through Entity - Michigan Department of Health and Human Services, Neighborhood Service Organization, and Detroit Wayne Integrated Health Network Finding Type - Material weakness Repeat Finding - No Criteria - Per 2 CFR 200.303(a), a non federal entity must establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should align with the guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition - The Organization lacked sufficient controls to ensure consistent reviews/approvals of monthly reimbursement requests and tenant rent calculations throughout the year. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - The review and approval of the monthly reimbursement requests and the tenant calculation serve to prevent and detect and correct noncompliance specific to the following compliance categories: period of performance, earmarking, program income and rent reasonableness. Each grant requests reimbursement for expenses incurred on a monthly basis. The review of the monthly reimbursement request, including supporting documentation, verifies that the costs are within the period of performance, administrative costs did not exceed 10 percent, and use of program income is consistent with grant terms. The review of the tenant rental calculations, including tenant rent calculation worksheet, verifies that the amount charged to participants is calculated and charged appropriately and the associated program income is identified and tracked appropriately. Based on the testing performed, the audit procedures identified that in 5 out of the 12 months there was not evidence of review for monthly reimbursement requests for one or more of the programs. Testing also identified that 4 out of a sample of 35 tenant rent calculations did not have evidence of review. Cause and Effect - The controls in place to ensure period of performance, earmarking, program income, and rent reasonableness are reviewed for completeness and accuracy were not in place. The lack of controls could result in an instance of noncompliance not being identified. Recommendation - We recommend the Organization ensure controls are in place to ensure the monthly reimbursement requests and the tenant rent calculations are reviewed for completeness and accuracy and for compliance with period of performance, earmarking, program income and rent reasonableness. Views of Responsible Officials and Corrective Action Plan - Effective immediately, the accounting director or rent analyst will review and approve the monthly reimbursement requests and rent calculations.
Assistance Listing, Federal Agency, and Program Name - 14.267, U.S. Department of Housing and Urban Development, Continuum of Care Program Federal Award Identification Number and Year - MI0429L5F012209, and MI0030L5F012215 (direct funded); 20230256-00, 20240559-00, MI0074L5F012114, and MI0074L5F012215 (pass-through funded) Pass through Entity - Michigan Department of Health and Human Services, Neighborhood Service Organization, and Detroit Wayne Integrated Health Network Finding Type - Material weakness Repeat Finding - No Criteria - Per 2 CFR 200.303(a), a non federal entity must establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should align with the guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition - The Organization lacked sufficient controls to ensure consistent reviews/approvals of monthly reimbursement requests and tenant rent calculations throughout the year. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - The review and approval of the monthly reimbursement requests and the tenant calculation serve to prevent and detect and correct noncompliance specific to the following compliance categories: period of performance, earmarking, program income and rent reasonableness. Each grant requests reimbursement for expenses incurred on a monthly basis. The review of the monthly reimbursement request, including supporting documentation, verifies that the costs are within the period of performance, administrative costs did not exceed 10 percent, and use of program income is consistent with grant terms. The review of the tenant rental calculations, including tenant rent calculation worksheet, verifies that the amount charged to participants is calculated and charged appropriately and the associated program income is identified and tracked appropriately. Based on the testing performed, the audit procedures identified that in 5 out of the 12 months there was not evidence of review for monthly reimbursement requests for one or more of the programs. Testing also identified that 4 out of a sample of 35 tenant rent calculations did not have evidence of review. Cause and Effect - The controls in place to ensure period of performance, earmarking, program income, and rent reasonableness are reviewed for completeness and accuracy were not in place. The lack of controls could result in an instance of noncompliance not being identified. Recommendation - We recommend the Organization ensure controls are in place to ensure the monthly reimbursement requests and the tenant rent calculations are reviewed for completeness and accuracy and for compliance with period of performance, earmarking, program income and rent reasonableness. Views of Responsible Officials and Corrective Action Plan - Effective immediately, the accounting director or rent analyst will review and approve the monthly reimbursement requests and rent calculations.
Assistance Listing, Federal Agency, and Program Name - 14.267, U.S. Department of Housing and Urban Development, Continuum of Care Program Federal Award Identification Number and Year - MI0429L5F012209, and MI0030L5F012215 (direct funded); 20230256-00, 20240559-00, MI0074L5F012114, and MI0074L5F012215 (pass-through funded) Pass through Entity - Michigan Department of Health and Human Services, Neighborhood Service Organization, and Detroit Wayne Integrated Health Network Finding Type - Material weakness Repeat Finding - No Criteria - Per 2 CFR 200.303(a), a non federal entity must establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should align with the guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition - The Organization lacked sufficient controls to ensure consistent reviews/approvals of monthly reimbursement requests and tenant rent calculations throughout the year. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - The review and approval of the monthly reimbursement requests and the tenant calculation serve to prevent and detect and correct noncompliance specific to the following compliance categories: period of performance, earmarking, program income and rent reasonableness. Each grant requests reimbursement for expenses incurred on a monthly basis. The review of the monthly reimbursement request, including supporting documentation, verifies that the costs are within the period of performance, administrative costs did not exceed 10 percent, and use of program income is consistent with grant terms. The review of the tenant rental calculations, including tenant rent calculation worksheet, verifies that the amount charged to participants is calculated and charged appropriately and the associated program income is identified and tracked appropriately. Based on the testing performed, the audit procedures identified that in 5 out of the 12 months there was not evidence of review for monthly reimbursement requests for one or more of the programs. Testing also identified that 4 out of a sample of 35 tenant rent calculations did not have evidence of review. Cause and Effect - The controls in place to ensure period of performance, earmarking, program income, and rent reasonableness are reviewed for completeness and accuracy were not in place. The lack of controls could result in an instance of noncompliance not being identified. Recommendation - We recommend the Organization ensure controls are in place to ensure the monthly reimbursement requests and the tenant rent calculations are reviewed for completeness and accuracy and for compliance with period of performance, earmarking, program income and rent reasonableness. Views of Responsible Officials and Corrective Action Plan - Effective immediately, the accounting director or rent analyst will review and approve the monthly reimbursement requests and rent calculations.
Special Tests and Provisions – Housing Quality Standards (HQS) Enforcement Finding Number: 2024-002 Assistance Listing Number and Title: AL # 14.871/14.879 Housing Choice Voucher Cluster Federal Award Identification Number / Year: OH054AF0148 / 2023 Federal Agency: U.S. Department of Housing and Urban Development Compliance Requirement: HQS Enforcement Pass-Through Entity: None Repeat Finding from Prior Audit? No Noncompliance and Material Weakness 2 CFR § 2400.101 gives regulatory effect to the Department of Housing & Urban Development for 2 CFR § 200.303 which requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain effective internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 24 CFR § 982.404(d)(2) provides that the Public Housing Authority (PHA) must abate the Housing Assistance Payment (HAP), including amounts that had been withheld, if the owner fails to make the repairs within the applicable cure period (within 24 hours of notification for life-threatening deficiencies and within 30 days of notification (or other reasonable period established by the PHA) for non-life-threatening deficiencies). Due to deficiencies in the Authority's internal controls over compliance requirements, seven percent of inspections tested for Housing Quality Standards compliance did not abate HAP payments after the owner failed to make the repairs noted in the inspection report within the 30 period. Failing to properly abate HAP payments could result in the Authority making payments to owners who do not meet Housing Quality Standards. The Authority should adopt policies and procedures for HAP payments to ensure compliance with 24 CFR § 982.404(d)(2)
Special Tests and Provisions – Housing Quality Standards (HQS) Enforcement Finding Number: 2024-002 Assistance Listing Number and Title: AL # 14.871/14.879 Housing Choice Voucher Cluster Federal Award Identification Number / Year: OH054AF0148 / 2023 Federal Agency: U.S. Department of Housing and Urban Development Compliance Requirement: HQS Enforcement Pass-Through Entity: None Repeat Finding from Prior Audit? No Noncompliance and Material Weakness 2 CFR § 2400.101 gives regulatory effect to the Department of Housing & Urban Development for 2 CFR § 200.303 which requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain effective internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 24 CFR § 982.404(d)(2) provides that the Public Housing Authority (PHA) must abate the Housing Assistance Payment (HAP), including amounts that had been withheld, if the owner fails to make the repairs within the applicable cure period (within 24 hours of notification for life-threatening deficiencies and within 30 days of notification (or other reasonable period established by the PHA) for non-life-threatening deficiencies). Due to deficiencies in the Authority's internal controls over compliance requirements, seven percent of inspections tested for Housing Quality Standards compliance did not abate HAP payments after the owner failed to make the repairs noted in the inspection report within the 30 period. Failing to properly abate HAP payments could result in the Authority making payments to owners who do not meet Housing Quality Standards. The Authority should adopt policies and procedures for HAP payments to ensure compliance with 24 CFR § 982.404(d)(2)
Criteria: Nonfederal entities in receipt of federal funds must comply with the requirements of 2 CFR 200.303(a), which require an entity to establish and maintain effective internal control over the federal award to ensure compliance with federal statutes, regulations, and the terms and conditions of the federal award. This includes properly identifying all federal awards subject to the Uniform Guidance and fairly presenting the required information, including the assistance listing number (ALN), in the schedule of expenditures of federal awards (SEFA). Condition: The schedule of expenditures of federal awards was reissued after an error was identified by management in the schedule of expenditures of federal awards, specifically in the assistance listing number (ALN) under grant IL-2023-028-00, after the report was originally issued. Cause: The District had a minor lapse in internal controls related to the preparation and review of the schedule of expenditures of federal awards. Management detected the error in the ALN number of grant IL-2023-028-00; however, the audit report had already been issued. Effect: Without adequate internal controls over preparation and review of the schedule of expenditures of federal awards, it is possible that material errors would not be detected in a timely manner and could be reported. Questioned Costs: None noted. Recommendation: We recommend that the District review the control procedures around preparation and review of the schedule of expenditures of federal awards and implement an independent review of the ALN numbers per the grant agreements in the initial review of the SEFA.
2024‐002 INTERNAL CONTROL DOCUMENTATION Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number U.S. Department of Housing and Urban Development Community Development Block Grants/Entitlement Grants 14.218 Criteria: 2 CFR 200.303 requires that a non‐federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non‐Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: The City’s policies provide for review and approval of documentation and reports related to program compliance requirements however, evidence supporting the review for internal control purposes was not consistently documented or retained. Questioned Costs: Unknown Context: Total federal expenditures for the Community Development Block Grants/Entitlement Grants were $3,436,560 for the year ended June 30, 2024. Cause: The City did not retain adequate documentation supporting the review and approval of documentation. Effect: The City may not be in compliance with related program compliance requirements. Recommendation: We recommend that the City enhance their policies to ensure that documentation of review and approvals are maintained as evidence of controls with the specified requirements. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.
2024–003 ALLOWABILITY‐PAYROLL Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Housing and Urban Development Community Development Block Grants/Entitlement Grants 14.218 Criteria: 2 CFR 200.303 requires that a non‐federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non‐Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.430(g)(1) states, “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the recipient or subrecipient; (iii) Reasonably reflect the total activity for which the employee is compensated by the recipient or subrecipient, not exceeding 100 percent of compensated activities (for IHEs, this is the IBS); (iv) Encompass federally‐assisted and all other activities compensated by the recipient or subrecipient on an integrated basis but may include the use of subsidiary records as defined in the recipient's or subrecipient's written policy; (v) Comply with the established accounting policies and procedures of the recipient or subrecipient (See paragraph (i)(1)(ii) of this section for treatment of incidental work for IHEs.); and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non‐Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. 2 CFR 200.403 indicates that costs must “be consistent with policies and procedures that apply uniformly to both federally‐financed and other activities of the non‐Federal entity” and must “be adequately documented”. Condition: For 6 of the 17 payroll transactions selected for testing the individual’s hourly rate of pay charged to the federal program was not consistent with actual pay rates. Documentation supporting the difference in rate paid and rate reimbursed from the federal program was not available. Questioned Costs: $69 Context: Total federal expenditures for the Community Development Block Grant program were $3,436,560. The 6 payroll transactions represent $8,906 of the total payroll transactions tested of $24,915 for the program. Total payroll charged to the grant was $292,826. Cause: The City does not have adequate internal controls and policies and procedures in place to ensure that the payroll amounts reimbursed from the federal funds correspond to the payroll rates in the underlying payroll accounting records. Effect: The City is not be in compliance with federal statues, regulations, and terms of the conditions of the federal award. Expenditures were paid that are not allowable. The Authority may not identify noncompliance with federal statues, regulations, and terms of the conditions of the federal award including allowability. Recommendation: We recommend that City enhance internal controls to ensure that expenditures charged to the federal awards are properly reviewed and supported. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.
2024‐002 INTERNAL CONTROL DOCUMENTATION Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number U.S. Department of Housing and Urban Development Community Development Block Grants/Entitlement Grants 14.218 Criteria: 2 CFR 200.303 requires that a non‐federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non‐Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: The City’s policies provide for review and approval of documentation and reports related to program compliance requirements however, evidence supporting the review for internal control purposes was not consistently documented or retained. Questioned Costs: Unknown Context: Total federal expenditures for the Community Development Block Grants/Entitlement Grants were $3,436,560 for the year ended June 30, 2024. Cause: The City did not retain adequate documentation supporting the review and approval of documentation. Effect: The City may not be in compliance with related program compliance requirements. Recommendation: We recommend that the City enhance their policies to ensure that documentation of review and approvals are maintained as evidence of controls with the specified requirements. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.
2024–003 ALLOWABILITY‐PAYROLL Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Housing and Urban Development Community Development Block Grants/Entitlement Grants 14.218 Criteria: 2 CFR 200.303 requires that a non‐federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non‐Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.430(g)(1) states, “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the recipient or subrecipient; (iii) Reasonably reflect the total activity for which the employee is compensated by the recipient or subrecipient, not exceeding 100 percent of compensated activities (for IHEs, this is the IBS); (iv) Encompass federally‐assisted and all other activities compensated by the recipient or subrecipient on an integrated basis but may include the use of subsidiary records as defined in the recipient's or subrecipient's written policy; (v) Comply with the established accounting policies and procedures of the recipient or subrecipient (See paragraph (i)(1)(ii) of this section for treatment of incidental work for IHEs.); and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non‐Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. 2 CFR 200.403 indicates that costs must “be consistent with policies and procedures that apply uniformly to both federally‐financed and other activities of the non‐Federal entity” and must “be adequately documented”. Condition: For 6 of the 17 payroll transactions selected for testing the individual’s hourly rate of pay charged to the federal program was not consistent with actual pay rates. Documentation supporting the difference in rate paid and rate reimbursed from the federal program was not available. Questioned Costs: $69 Context: Total federal expenditures for the Community Development Block Grant program were $3,436,560. The 6 payroll transactions represent $8,906 of the total payroll transactions tested of $24,915 for the program. Total payroll charged to the grant was $292,826. Cause: The City does not have adequate internal controls and policies and procedures in place to ensure that the payroll amounts reimbursed from the federal funds correspond to the payroll rates in the underlying payroll accounting records. Effect: The City is not be in compliance with federal statues, regulations, and terms of the conditions of the federal award. Expenditures were paid that are not allowable. The Authority may not identify noncompliance with federal statues, regulations, and terms of the conditions of the federal award including allowability. Recommendation: We recommend that City enhance internal controls to ensure that expenditures charged to the federal awards are properly reviewed and supported. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.
FINDING 2024-001 Information on the federal program: Subject: Child Nutrition Cluster - Internal Controls Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program Assistance Listing Number: 10.553, 10.555 Federal Award Numbers and Years (or Other Identifying Numbers): FY2023, FY2024 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Eligibility Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 7 CFR 245.3(c) sates in part: Each School Food Authority shall serve free and reduced price meals or free milk in the respective programs to children eligible under its eligibility criteria. Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the eligibility compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with eligibility requirements. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. Questioned Costs: There were no questioned costs identified. Context: During sample testing of 60 students for eligibility, we noted 7 instances where there was no documented review by someone other than the individual making the eligibility determination. The lack of review was isolated to paper applications. Identification as a repeat finding, if applicable: No. Recommendation: We recommended that the School Corporation's management establish a formal review over a sample of applicants entered into the software to ensure the accuracy and completeness of the information entered. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
FINDING 2024-001 Information on the federal program: Subject: Child Nutrition Cluster - Internal Controls Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program Assistance Listing Number: 10.553, 10.555 Federal Award Numbers and Years (or Other Identifying Numbers): FY2023, FY2024 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Eligibility Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 7 CFR 245.3(c) sates in part: Each School Food Authority shall serve free and reduced price meals or free milk in the respective programs to children eligible under its eligibility criteria. Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the eligibility compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with eligibility requirements. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. Questioned Costs: There were no questioned costs identified. Context: During sample testing of 60 students for eligibility, we noted 7 instances where there was no documented review by someone other than the individual making the eligibility determination. The lack of review was isolated to paper applications. Identification as a repeat finding, if applicable: No. Recommendation: We recommended that the School Corporation's management establish a formal review over a sample of applicants entered into the software to ensure the accuracy and completeness of the information entered. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
FINDING 2024-001 Information on the federal program: Subject: Child Nutrition Cluster - Internal Controls Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program Assistance Listing Number: 10.553, 10.555 Federal Award Numbers and Years (or Other Identifying Numbers): FY2023, FY2024 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Eligibility Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 7 CFR 245.3(c) sates in part: Each School Food Authority shall serve free and reduced price meals or free milk in the respective programs to children eligible under its eligibility criteria. Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the eligibility compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with eligibility requirements. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. Questioned Costs: There were no questioned costs identified. Context: During sample testing of 60 students for eligibility, we noted 7 instances where there was no documented review by someone other than the individual making the eligibility determination. The lack of review was isolated to paper applications. Identification as a repeat finding, if applicable: No. Recommendation: We recommended that the School Corporation's management establish a formal review over a sample of applicants entered into the software to ensure the accuracy and completeness of the information entered. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
FINDING 2024-003 Information on the federal program: Subject: Education Stabilization Fund (ESSER) – Internal Controls Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D210013, S425U200013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 Financial reporting . . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Reporting compliance requirements. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. FINDING 2024-003 (Continued) Questioned Costs: There were no questioned costs identified. Context: The School Corporation was required to submit two Annual Data Reports to the Indiana Department of Education (IDOE) during the audit period to meet federal reporting requirements for ESSER grant awards. We noted that the ESSER II and ESSER III amounts reported on the Year 3 report ($347,591 and $337,851 respectively) did not agree to the underlying expenditure records ($135,355 and $159,811 respectively). Additionally, we noted that the ESSER II amount reported on the Year 4 report ($233,093) did not agree to the underlying expenditure records ($267,310) of the School Corporation. Identification as a repeat finding: This is a repeat finding from the immediately prior audit. The prior finding number was 2022-003. Recommendation: We recommend someone other than the preparer of the report perform a documented review prior to submission to validate the accuracy and completeness of the data submitted. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
FINDING 2024-003 Information on the federal program: Subject: Education Stabilization Fund (ESSER) – Internal Controls Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D210013, S425U200013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 Financial reporting . . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Reporting compliance requirements. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. FINDING 2024-003 (Continued) Questioned Costs: There were no questioned costs identified. Context: The School Corporation was required to submit two Annual Data Reports to the Indiana Department of Education (IDOE) during the audit period to meet federal reporting requirements for ESSER grant awards. We noted that the ESSER II and ESSER III amounts reported on the Year 3 report ($347,591 and $337,851 respectively) did not agree to the underlying expenditure records ($135,355 and $159,811 respectively). Additionally, we noted that the ESSER II amount reported on the Year 4 report ($233,093) did not agree to the underlying expenditure records ($267,310) of the School Corporation. Identification as a repeat finding: This is a repeat finding from the immediately prior audit. The prior finding number was 2022-003. Recommendation: We recommend someone other than the preparer of the report perform a documented review prior to submission to validate the accuracy and completeness of the data submitted. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
2024 - 009 Reporting - Capital Expenditures (2023-005 and 2022-008) Federal Agency: U.S. Department of Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds (SLFRF) Assistance Listing Number: 21. 027 Federal Award Identification Number and Year: Pub. L. No. 117-2-2021 Award Period: 5/10/2021 - l 2/3 l /2026 Type of Finding • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or specific requirement: According to §200.303 Internal controls of 2 CFR Part 200, the recipient and subrecipient must establish, document, and maintain effective internal control over the federal award that provides reasonable assurance that the recipient or subrecipient is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. According to the 2022 Final Rule, for projects with total expected capital expenditures of $1 million or greater, recipients must complete and meet the substantive requirements of a written justification for their capital expenditure. Such written justification must include the following elements: (i) Describe the harm or need to be addressed; (ii) Explain why a capital expenditure is appropriate; and (iii) Compare the proposed capital expenditure to at least two alternative capital expenditures and demonstrate why the proposed capital expenditure is superior. Condition: During our testing, we noted two of the two written justifications did not include all the elements outlined in the 2022 Final Rule. Questioned costs: None Context: During our testing, it was noted that the written justifications for the WECH Kitchen and Gibson Medical Respite projects did not compare the proposed capital expenditure to at least two alternative capital expenditures and demonstrate why the proposed capital expenditure is superior. Total federal expenditures for WECH Kitchen and Gibson Medical Respite as of June 30, 2024 are $1,484,411 and $6,236,193, respectively. Cause: Management oversight. The City did not follow the requirements of a written justification for capital expenditures as outlined in the 2022 Final Rule. Effect: The auditor noted instances of noncompliance. Noncompliance results in inaccurate reporting. Recommendation: We recommend the City update the written justifications to include all the elements outlined in the 2022 Final Rule. Management Response: The City concurs with the finding. The City's Grant Administrator will work with the Department of Health, Housing and Homeless and the Department of Municipal Development to adequately document the comparison of capital expenditure options and demonstrate the superiority of the chosen capital project in the final written justifications. Timeline and Responsible Position: March 2025 - Grant Administrator
2024 - 010 Allowable Activities and Costs/Cost Principles - Payroll (2023-010 and 2022-005) Federal Agency: U.S. Department of Transportation Federal Program Name: Federal Transit Cluster - Federal Transit - Formula Grants Assistance Listing Number: 20.507 Federal Award Identification Number and Year: N1vl-2023-022-00 - 2023 N1vl-2023-036-00 - 2023 Award Period: 5/31/2023 - 9/30/2024 12/18/2023 - 6/30/2025 Type of Finding: • Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: According to §200.303 Internal controls of 2 CFR Part 200, the recipient and subrecipient must establish, document, and maintain effective internal control over the federal award that provides reasonable assurance that the recipient or subrecipient is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. According to §200.511 Audit findings follow-up of 2 CFR Part 200, the auditee is responsible for follow-up and corrective action on all audit findings. At the completion of the audit, the auditee must prepare a corrective action plan to address each audit finding included in the auditor's report for the current year. According to the City's Corrective Action Plan for the year ended June 30, 2023, the Transit department has established a timeline for the completion and approval of the time card policy, and it is expected that the policy will take effect in April 2024. Condition: During our testing, we noted the City did not have adequate internal controls designed to ensure proper timecard approval. Management's Progress for Repeat Findings: This is a repeated and modified finding. While the City has improved its efforts, there are still opportunities for improvement to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements as well as compliance with City policy. Questioned costs: None Context: During our testing, it was noted that thirteen out of sixteen payroll disbursements did not have approval of the employees' timecards. Cause: The City has not implemented corrective action from the audit for the year ended June 30, 2023. The Transit department is working on the policy and in the final stages of getting the policy updated. Effect: The auditor noted no instances of noncompliance with the provisions of allowable activities and costs/cost principles; however, the lack of internal controls over these compliance requirements provides an opportunity for noncompliance. Recommendation: We recommend the City work to implement full corrective action. Management Response: The City concurs with the finding. Transit Department staff is in the process of developing a policy establishing internal controls over timekeeping and is near finalizing the policy. Once finalized, the policy will be reviewed with appropriate parties. Further, the Transit Department is exploring the purchase and implementation of additional software to assist with enacting these controls. Timeline and Responsible Position: April 2025 - Transit Department Director
2024 - 011 Allowable Activities and Costs/Cost Principles - Payroll Federal Agency: U.S. Department of Justice Federal Program Name: Public Safety Partnership and Community Policing Grants Assistance Listing Number: 16. 710 Federal Award Identification Number and Year: 2020ULWX0001 - 2020 Award Period: 7/1/2020 - 6/30/2024 Type of Finding • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or specific requirement: According to §200.303 Internal controls of 2 CFR Part 200, the recipient and subrecipient must establish, document, and maintain effective internal control over the federal award that provides reasonable assurance that the recipient or subrecipient is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. According to §200.403 Factors affecting allowability of costs of 2 CFR Part 200, costs must conform to any limitations or exclusions set forth in these principles or in the federal award as to types or amount of cost items. The FY 2020 COPS Hiring Program (CHP) award provides funding to law enforcement agencies to hire and/or rehire career law enforcement officers. Specific to the City, CHP funding is for forty new hires. According to the award, the City may only be reimbursed for the approved cost categories that are documented within the Financial Clearance Memorandum (FC:M). Condition: During our testing, we noted the City paid incentive pay with CHP funding. Also, we noted the City paid salaries and fringe benefits for four officers not listed in the Date of Hire - COPS Officer List with CHP funding. Questioned costs: $16,882.17 Context: During our testing, it was noted that the City paid incentive pay of $3,000.00 for the pay period end 12/01/2023. The FCM does not have a cost category for incentive pay. Also, it was noted that the City paid salaries and fringe benefits of $13,882.17 for four officers not listed in the Date of Hire - COPS Officer List provided to the federal agency. Cause: The City charged the incentive pay to the grant by mistake. The City transferred the four officers to the grant during its initial years. The City moved the original forty officers to the grant and transferred any officers off the grant back to their positions funded by the general fund. These officers should have been moved out. Effect: The auditor noted instances of noncompliance. Noncompliance results in potential pay back of federal funds. Recommendation: We recommend the City review costs charged to the grant to ensure the FCM has a cost category for the costs. We recommend the City review the officers charged to the grant to ensure they are listed in the he Date of Hire - COPS Officer List provided to the federal agency. For any questioned costs, we recommend the City work with the federal agency for resolution. Management Response: The City concurs with the finding. Albuquerque Police Department (APD) Grant Administrator will meet with the City Grant Administrator to review and prepare the necessary payroll corrections, ensuring that all payroll charges allocated to the grant are accurate. The APD Grant Administrator will be responsible for submitting correcting payroll reclassifications to the City's Grants Management Section for review, entry and approval no later than January 31, 2025. APD will work directly with the City's Grants Management Section to establish new reconciliation, reclassification and validation processes to ensure that only eligible officers and pay types are charged to the grant. Timeline and Responsible Position: January 2025 - APD Grant Administrator