FINDING 2024-004 Subject: Child Nutrition Cluster - Suspension and Debarment Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children Assistance Listings Numbers: 10.553, 10.555, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY22-23, FY23-24 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context An effective system of internal controls was not in place at the School Corporation to ensure compliance with requirements related to the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Prior to entering into subawards and covered transactions with federal award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to, contracts for goods and services awarded under a nonprocurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the SAM exclusions, collecting a certification from that person, or adding a clause or condition to the covered transaction with that person. INDIANA STATE BOARD OF ACCOUNTS 20 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) A population of two covered transactions for purchases that equaled or exceeded $25,000 paid from the School Lunch fund were identified. The transactions totaling $76,138 were tested; however, the School Corporation did not verify the suspension and debarment status prior to entering into the contracts. The lack of internal controls and noncompliance systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 180.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking SAM Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person." Cause The School Corporation's process was to check for SAM Exclusions, collect a certification from the vendor, or add a clause or condition to the covered transaction with the vendor. However, the SAM exclusion check process was not properly implemented for the vendors tested nor was a certification collected, or a clause or condition added to the covered transaction. Effect Noncompliance with the grant agreement and the compliance requirement could result in the repayment of federal funds. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management evaluate the procedures established to ensure processes are functioning as intended to prevent, or detect and correct, material noncompliance. INDIANA STATE BOARD OF ACCOUNTS 21 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-004 Subject: Child Nutrition Cluster - Suspension and Debarment Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children Assistance Listings Numbers: 10.553, 10.555, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY22-23, FY23-24 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context An effective system of internal controls was not in place at the School Corporation to ensure compliance with requirements related to the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Prior to entering into subawards and covered transactions with federal award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to, contracts for goods and services awarded under a nonprocurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the SAM exclusions, collecting a certification from that person, or adding a clause or condition to the covered transaction with that person. INDIANA STATE BOARD OF ACCOUNTS 20 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) A population of two covered transactions for purchases that equaled or exceeded $25,000 paid from the School Lunch fund were identified. The transactions totaling $76,138 were tested; however, the School Corporation did not verify the suspension and debarment status prior to entering into the contracts. The lack of internal controls and noncompliance systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 180.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking SAM Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person." Cause The School Corporation's process was to check for SAM Exclusions, collect a certification from the vendor, or add a clause or condition to the covered transaction with the vendor. However, the SAM exclusion check process was not properly implemented for the vendors tested nor was a certification collected, or a clause or condition added to the covered transaction. Effect Noncompliance with the grant agreement and the compliance requirement could result in the repayment of federal funds. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management evaluate the procedures established to ensure processes are functioning as intended to prevent, or detect and correct, material noncompliance. INDIANA STATE BOARD OF ACCOUNTS 21 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-004 Subject: Child Nutrition Cluster - Suspension and Debarment Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children Assistance Listings Numbers: 10.553, 10.555, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY22-23, FY23-24 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context An effective system of internal controls was not in place at the School Corporation to ensure compliance with requirements related to the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Prior to entering into subawards and covered transactions with federal award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to, contracts for goods and services awarded under a nonprocurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the SAM exclusions, collecting a certification from that person, or adding a clause or condition to the covered transaction with that person. INDIANA STATE BOARD OF ACCOUNTS 20 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) A population of two covered transactions for purchases that equaled or exceeded $25,000 paid from the School Lunch fund were identified. The transactions totaling $76,138 were tested; however, the School Corporation did not verify the suspension and debarment status prior to entering into the contracts. The lack of internal controls and noncompliance systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 180.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking SAM Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person." Cause The School Corporation's process was to check for SAM Exclusions, collect a certification from the vendor, or add a clause or condition to the covered transaction with the vendor. However, the SAM exclusion check process was not properly implemented for the vendors tested nor was a certification collected, or a clause or condition added to the covered transaction. Effect Noncompliance with the grant agreement and the compliance requirement could result in the repayment of federal funds. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management evaluate the procedures established to ensure processes are functioning as intended to prevent, or detect and correct, material noncompliance. INDIANA STATE BOARD OF ACCOUNTS 21 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-004 Subject: Child Nutrition Cluster - Suspension and Debarment Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children Assistance Listings Numbers: 10.553, 10.555, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY22-23, FY23-24 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context An effective system of internal controls was not in place at the School Corporation to ensure compliance with requirements related to the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Prior to entering into subawards and covered transactions with federal award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to, contracts for goods and services awarded under a nonprocurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the SAM exclusions, collecting a certification from that person, or adding a clause or condition to the covered transaction with that person. INDIANA STATE BOARD OF ACCOUNTS 20 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) A population of two covered transactions for purchases that equaled or exceeded $25,000 paid from the School Lunch fund were identified. The transactions totaling $76,138 were tested; however, the School Corporation did not verify the suspension and debarment status prior to entering into the contracts. The lack of internal controls and noncompliance systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 180.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking SAM Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person." Cause The School Corporation's process was to check for SAM Exclusions, collect a certification from the vendor, or add a clause or condition to the covered transaction with the vendor. However, the SAM exclusion check process was not properly implemented for the vendors tested nor was a certification collected, or a clause or condition added to the covered transaction. Effect Noncompliance with the grant agreement and the compliance requirement could result in the repayment of federal funds. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management evaluate the procedures established to ensure processes are functioning as intended to prevent, or detect and correct, material noncompliance. INDIANA STATE BOARD OF ACCOUNTS 21 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-004 Subject: Child Nutrition Cluster - Suspension and Debarment Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children Assistance Listings Numbers: 10.553, 10.555, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY22-23, FY23-24 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context An effective system of internal controls was not in place at the School Corporation to ensure compliance with requirements related to the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Prior to entering into subawards and covered transactions with federal award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to, contracts for goods and services awarded under a nonprocurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the SAM exclusions, collecting a certification from that person, or adding a clause or condition to the covered transaction with that person. INDIANA STATE BOARD OF ACCOUNTS 20 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) A population of two covered transactions for purchases that equaled or exceeded $25,000 paid from the School Lunch fund were identified. The transactions totaling $76,138 were tested; however, the School Corporation did not verify the suspension and debarment status prior to entering into the contracts. The lack of internal controls and noncompliance systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 180.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking SAM Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person." Cause The School Corporation's process was to check for SAM Exclusions, collect a certification from the vendor, or add a clause or condition to the covered transaction with the vendor. However, the SAM exclusion check process was not properly implemented for the vendors tested nor was a certification collected, or a clause or condition added to the covered transaction. Effect Noncompliance with the grant agreement and the compliance requirement could result in the repayment of federal funds. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management evaluate the procedures established to ensure processes are functioning as intended to prevent, or detect and correct, material noncompliance. INDIANA STATE BOARD OF ACCOUNTS 21 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-005 Subject: Special Education Cluster (IDEA) - Period of Performance Federal Agency: Department of Education Federal Programs: Special Education Grants to States, COVID-19 - Special Education Grants to States, Special Education Preschool Grants, COVID-19 - Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 22611-047-PN01, 22611-047-ARP, 22619-047-PN01, 22619-047-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Period of Performance Audit Findings: Material Weakness, Other Matters Condition and Context During the audit period, the School Corporation was a member of the Cooperative School Services (Cooperative). The Cooperative operated the special education programs and spent the federal money on behalf of its member schools. As the grant agreement was between the Indiana Department of Education and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. For Special Education Cluster awards, funds must be obligated during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. When testing transactions which occurred in the liquidation period for the 22611-047-PN01, 22611-047-ARP, 22619-047-PN01, and 22619-047-ARP grant awards, two exceptions were identified in the initial sample of five transactions. When expanding the sample, a third exception was noted, and it was concluded that it would not be appropriate to examine the remaining 14 transactions. For the above listed awards, costs must be obligated by September 30, 2023. For the three identified exceptions, an initial purchase order was made in September, but the ultimate transaction was paid to a separate vendor than the original purchase order, and this obligation was incurred in November 2023. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 22 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.403(h) states: "Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to § 200.308(e)(3)." 34 CFR 76.707 states in part: ". . . If the obligation is for- . . . (d) Performance of work other than personal services. . . . The obligation is made- On the date on which the State or subgrantee makes a binding written commitment to acquire the property. . . ." 2 CFR 200.1 states in part: ". . . Period of Performance means the total estimated time interval between the start of an initial Federal award and the planned end date . . ." 36 CFR 76.709(a) states: "If a State or a subgrantee does not obligate all of its grant or subgrant funds by the end of the fiscal year for which Congress appropriated the funds, it may obligate the remaining funds during a carryover period of one additional fiscal year." Cause Management had established an initial obligation date that occurred in September of the second fiscal year but modified the final vendor for payment. The new obligation occurred after the period in which the School Corporation was allowed to incur the expense. Effect If funds are not obligated by the end of the specified date, the grantor agency is not obligated to reimburse the School Corporation for costs incurred. This may indicate that the funding that was reimbursed, which incurred outside of the period of performance, will need to be repaid to the grantor agency, and the School Corporation will then need to support the costs with nonfederal funding. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls to ensure that no costs are incurred after the September 30 deadline and to ensure compliance with the grant agreement and the Period of Performance compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-005 Subject: Special Education Cluster (IDEA) - Period of Performance Federal Agency: Department of Education Federal Programs: Special Education Grants to States, COVID-19 - Special Education Grants to States, Special Education Preschool Grants, COVID-19 - Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 22611-047-PN01, 22611-047-ARP, 22619-047-PN01, 22619-047-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Period of Performance Audit Findings: Material Weakness, Other Matters Condition and Context During the audit period, the School Corporation was a member of the Cooperative School Services (Cooperative). The Cooperative operated the special education programs and spent the federal money on behalf of its member schools. As the grant agreement was between the Indiana Department of Education and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. For Special Education Cluster awards, funds must be obligated during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. When testing transactions which occurred in the liquidation period for the 22611-047-PN01, 22611-047-ARP, 22619-047-PN01, and 22619-047-ARP grant awards, two exceptions were identified in the initial sample of five transactions. When expanding the sample, a third exception was noted, and it was concluded that it would not be appropriate to examine the remaining 14 transactions. For the above listed awards, costs must be obligated by September 30, 2023. For the three identified exceptions, an initial purchase order was made in September, but the ultimate transaction was paid to a separate vendor than the original purchase order, and this obligation was incurred in November 2023. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 22 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.403(h) states: "Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to § 200.308(e)(3)." 34 CFR 76.707 states in part: ". . . If the obligation is for- . . . (d) Performance of work other than personal services. . . . The obligation is made- On the date on which the State or subgrantee makes a binding written commitment to acquire the property. . . ." 2 CFR 200.1 states in part: ". . . Period of Performance means the total estimated time interval between the start of an initial Federal award and the planned end date . . ." 36 CFR 76.709(a) states: "If a State or a subgrantee does not obligate all of its grant or subgrant funds by the end of the fiscal year for which Congress appropriated the funds, it may obligate the remaining funds during a carryover period of one additional fiscal year." Cause Management had established an initial obligation date that occurred in September of the second fiscal year but modified the final vendor for payment. The new obligation occurred after the period in which the School Corporation was allowed to incur the expense. Effect If funds are not obligated by the end of the specified date, the grantor agency is not obligated to reimburse the School Corporation for costs incurred. This may indicate that the funding that was reimbursed, which incurred outside of the period of performance, will need to be repaid to the grantor agency, and the School Corporation will then need to support the costs with nonfederal funding. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls to ensure that no costs are incurred after the September 30 deadline and to ensure compliance with the grant agreement and the Period of Performance compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-005 Subject: Special Education Cluster (IDEA) - Period of Performance Federal Agency: Department of Education Federal Programs: Special Education Grants to States, COVID-19 - Special Education Grants to States, Special Education Preschool Grants, COVID-19 - Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 22611-047-PN01, 22611-047-ARP, 22619-047-PN01, 22619-047-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Period of Performance Audit Findings: Material Weakness, Other Matters Condition and Context During the audit period, the School Corporation was a member of the Cooperative School Services (Cooperative). The Cooperative operated the special education programs and spent the federal money on behalf of its member schools. As the grant agreement was between the Indiana Department of Education and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. For Special Education Cluster awards, funds must be obligated during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. When testing transactions which occurred in the liquidation period for the 22611-047-PN01, 22611-047-ARP, 22619-047-PN01, and 22619-047-ARP grant awards, two exceptions were identified in the initial sample of five transactions. When expanding the sample, a third exception was noted, and it was concluded that it would not be appropriate to examine the remaining 14 transactions. For the above listed awards, costs must be obligated by September 30, 2023. For the three identified exceptions, an initial purchase order was made in September, but the ultimate transaction was paid to a separate vendor than the original purchase order, and this obligation was incurred in November 2023. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 22 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.403(h) states: "Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to § 200.308(e)(3)." 34 CFR 76.707 states in part: ". . . If the obligation is for- . . . (d) Performance of work other than personal services. . . . The obligation is made- On the date on which the State or subgrantee makes a binding written commitment to acquire the property. . . ." 2 CFR 200.1 states in part: ". . . Period of Performance means the total estimated time interval between the start of an initial Federal award and the planned end date . . ." 36 CFR 76.709(a) states: "If a State or a subgrantee does not obligate all of its grant or subgrant funds by the end of the fiscal year for which Congress appropriated the funds, it may obligate the remaining funds during a carryover period of one additional fiscal year." Cause Management had established an initial obligation date that occurred in September of the second fiscal year but modified the final vendor for payment. The new obligation occurred after the period in which the School Corporation was allowed to incur the expense. Effect If funds are not obligated by the end of the specified date, the grantor agency is not obligated to reimburse the School Corporation for costs incurred. This may indicate that the funding that was reimbursed, which incurred outside of the period of performance, will need to be repaid to the grantor agency, and the School Corporation will then need to support the costs with nonfederal funding. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls to ensure that no costs are incurred after the September 30 deadline and to ensure compliance with the grant agreement and the Period of Performance compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-005 Subject: Special Education Cluster (IDEA) - Period of Performance Federal Agency: Department of Education Federal Programs: Special Education Grants to States, COVID-19 - Special Education Grants to States, Special Education Preschool Grants, COVID-19 - Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 22611-047-PN01, 22611-047-ARP, 22619-047-PN01, 22619-047-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Period of Performance Audit Findings: Material Weakness, Other Matters Condition and Context During the audit period, the School Corporation was a member of the Cooperative School Services (Cooperative). The Cooperative operated the special education programs and spent the federal money on behalf of its member schools. As the grant agreement was between the Indiana Department of Education and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. For Special Education Cluster awards, funds must be obligated during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. When testing transactions which occurred in the liquidation period for the 22611-047-PN01, 22611-047-ARP, 22619-047-PN01, and 22619-047-ARP grant awards, two exceptions were identified in the initial sample of five transactions. When expanding the sample, a third exception was noted, and it was concluded that it would not be appropriate to examine the remaining 14 transactions. For the above listed awards, costs must be obligated by September 30, 2023. For the three identified exceptions, an initial purchase order was made in September, but the ultimate transaction was paid to a separate vendor than the original purchase order, and this obligation was incurred in November 2023. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 22 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.403(h) states: "Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to § 200.308(e)(3)." 34 CFR 76.707 states in part: ". . . If the obligation is for- . . . (d) Performance of work other than personal services. . . . The obligation is made- On the date on which the State or subgrantee makes a binding written commitment to acquire the property. . . ." 2 CFR 200.1 states in part: ". . . Period of Performance means the total estimated time interval between the start of an initial Federal award and the planned end date . . ." 36 CFR 76.709(a) states: "If a State or a subgrantee does not obligate all of its grant or subgrant funds by the end of the fiscal year for which Congress appropriated the funds, it may obligate the remaining funds during a carryover period of one additional fiscal year." Cause Management had established an initial obligation date that occurred in September of the second fiscal year but modified the final vendor for payment. The new obligation occurred after the period in which the School Corporation was allowed to incur the expense. Effect If funds are not obligated by the end of the specified date, the grantor agency is not obligated to reimburse the School Corporation for costs incurred. This may indicate that the funding that was reimbursed, which incurred outside of the period of performance, will need to be repaid to the grantor agency, and the School Corporation will then need to support the costs with nonfederal funding. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls to ensure that no costs are incurred after the September 30 deadline and to ensure compliance with the grant agreement and the Period of Performance compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-005 Subject: Special Education Cluster (IDEA) - Period of Performance Federal Agency: Department of Education Federal Programs: Special Education Grants to States, COVID-19 - Special Education Grants to States, Special Education Preschool Grants, COVID-19 - Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 22611-047-PN01, 22611-047-ARP, 22619-047-PN01, 22619-047-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Period of Performance Audit Findings: Material Weakness, Other Matters Condition and Context During the audit period, the School Corporation was a member of the Cooperative School Services (Cooperative). The Cooperative operated the special education programs and spent the federal money on behalf of its member schools. As the grant agreement was between the Indiana Department of Education and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. For Special Education Cluster awards, funds must be obligated during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. When testing transactions which occurred in the liquidation period for the 22611-047-PN01, 22611-047-ARP, 22619-047-PN01, and 22619-047-ARP grant awards, two exceptions were identified in the initial sample of five transactions. When expanding the sample, a third exception was noted, and it was concluded that it would not be appropriate to examine the remaining 14 transactions. For the above listed awards, costs must be obligated by September 30, 2023. For the three identified exceptions, an initial purchase order was made in September, but the ultimate transaction was paid to a separate vendor than the original purchase order, and this obligation was incurred in November 2023. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 22 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.403(h) states: "Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to § 200.308(e)(3)." 34 CFR 76.707 states in part: ". . . If the obligation is for- . . . (d) Performance of work other than personal services. . . . The obligation is made- On the date on which the State or subgrantee makes a binding written commitment to acquire the property. . . ." 2 CFR 200.1 states in part: ". . . Period of Performance means the total estimated time interval between the start of an initial Federal award and the planned end date . . ." 36 CFR 76.709(a) states: "If a State or a subgrantee does not obligate all of its grant or subgrant funds by the end of the fiscal year for which Congress appropriated the funds, it may obligate the remaining funds during a carryover period of one additional fiscal year." Cause Management had established an initial obligation date that occurred in September of the second fiscal year but modified the final vendor for payment. The new obligation occurred after the period in which the School Corporation was allowed to incur the expense. Effect If funds are not obligated by the end of the specified date, the grantor agency is not obligated to reimburse the School Corporation for costs incurred. This may indicate that the funding that was reimbursed, which incurred outside of the period of performance, will need to be repaid to the grantor agency, and the School Corporation will then need to support the costs with nonfederal funding. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls to ensure that no costs are incurred after the September 30 deadline and to ensure compliance with the grant agreement and the Period of Performance compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-005 Subject: Special Education Cluster (IDEA) - Period of Performance Federal Agency: Department of Education Federal Programs: Special Education Grants to States, COVID-19 - Special Education Grants to States, Special Education Preschool Grants, COVID-19 - Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 22611-047-PN01, 22611-047-ARP, 22619-047-PN01, 22619-047-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Period of Performance Audit Findings: Material Weakness, Other Matters Condition and Context During the audit period, the School Corporation was a member of the Cooperative School Services (Cooperative). The Cooperative operated the special education programs and spent the federal money on behalf of its member schools. As the grant agreement was between the Indiana Department of Education and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. For Special Education Cluster awards, funds must be obligated during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. When testing transactions which occurred in the liquidation period for the 22611-047-PN01, 22611-047-ARP, 22619-047-PN01, and 22619-047-ARP grant awards, two exceptions were identified in the initial sample of five transactions. When expanding the sample, a third exception was noted, and it was concluded that it would not be appropriate to examine the remaining 14 transactions. For the above listed awards, costs must be obligated by September 30, 2023. For the three identified exceptions, an initial purchase order was made in September, but the ultimate transaction was paid to a separate vendor than the original purchase order, and this obligation was incurred in November 2023. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 22 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.403(h) states: "Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to § 200.308(e)(3)." 34 CFR 76.707 states in part: ". . . If the obligation is for- . . . (d) Performance of work other than personal services. . . . The obligation is made- On the date on which the State or subgrantee makes a binding written commitment to acquire the property. . . ." 2 CFR 200.1 states in part: ". . . Period of Performance means the total estimated time interval between the start of an initial Federal award and the planned end date . . ." 36 CFR 76.709(a) states: "If a State or a subgrantee does not obligate all of its grant or subgrant funds by the end of the fiscal year for which Congress appropriated the funds, it may obligate the remaining funds during a carryover period of one additional fiscal year." Cause Management had established an initial obligation date that occurred in September of the second fiscal year but modified the final vendor for payment. The new obligation occurred after the period in which the School Corporation was allowed to incur the expense. Effect If funds are not obligated by the end of the specified date, the grantor agency is not obligated to reimburse the School Corporation for costs incurred. This may indicate that the funding that was reimbursed, which incurred outside of the period of performance, will need to be repaid to the grantor agency, and the School Corporation will then need to support the costs with nonfederal funding. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls to ensure that no costs are incurred after the September 30 deadline and to ensure compliance with the grant agreement and the Period of Performance compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-005 Subject: Special Education Cluster (IDEA) - Period of Performance Federal Agency: Department of Education Federal Programs: Special Education Grants to States, COVID-19 - Special Education Grants to States, Special Education Preschool Grants, COVID-19 - Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 22611-047-PN01, 22611-047-ARP, 22619-047-PN01, 22619-047-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Period of Performance Audit Findings: Material Weakness, Other Matters Condition and Context During the audit period, the School Corporation was a member of the Cooperative School Services (Cooperative). The Cooperative operated the special education programs and spent the federal money on behalf of its member schools. As the grant agreement was between the Indiana Department of Education and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. For Special Education Cluster awards, funds must be obligated during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. When testing transactions which occurred in the liquidation period for the 22611-047-PN01, 22611-047-ARP, 22619-047-PN01, and 22619-047-ARP grant awards, two exceptions were identified in the initial sample of five transactions. When expanding the sample, a third exception was noted, and it was concluded that it would not be appropriate to examine the remaining 14 transactions. For the above listed awards, costs must be obligated by September 30, 2023. For the three identified exceptions, an initial purchase order was made in September, but the ultimate transaction was paid to a separate vendor than the original purchase order, and this obligation was incurred in November 2023. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 22 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.403(h) states: "Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to § 200.308(e)(3)." 34 CFR 76.707 states in part: ". . . If the obligation is for- . . . (d) Performance of work other than personal services. . . . The obligation is made- On the date on which the State or subgrantee makes a binding written commitment to acquire the property. . . ." 2 CFR 200.1 states in part: ". . . Period of Performance means the total estimated time interval between the start of an initial Federal award and the planned end date . . ." 36 CFR 76.709(a) states: "If a State or a subgrantee does not obligate all of its grant or subgrant funds by the end of the fiscal year for which Congress appropriated the funds, it may obligate the remaining funds during a carryover period of one additional fiscal year." Cause Management had established an initial obligation date that occurred in September of the second fiscal year but modified the final vendor for payment. The new obligation occurred after the period in which the School Corporation was allowed to incur the expense. Effect If funds are not obligated by the end of the specified date, the grantor agency is not obligated to reimburse the School Corporation for costs incurred. This may indicate that the funding that was reimbursed, which incurred outside of the period of performance, will need to be repaid to the grantor agency, and the School Corporation will then need to support the costs with nonfederal funding. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls to ensure that no costs are incurred after the September 30 deadline and to ensure compliance with the grant agreement and the Period of Performance compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-005 Subject: Special Education Cluster (IDEA) - Period of Performance Federal Agency: Department of Education Federal Programs: Special Education Grants to States, COVID-19 - Special Education Grants to States, Special Education Preschool Grants, COVID-19 - Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 22611-047-PN01, 22611-047-ARP, 22619-047-PN01, 22619-047-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Period of Performance Audit Findings: Material Weakness, Other Matters Condition and Context During the audit period, the School Corporation was a member of the Cooperative School Services (Cooperative). The Cooperative operated the special education programs and spent the federal money on behalf of its member schools. As the grant agreement was between the Indiana Department of Education and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. For Special Education Cluster awards, funds must be obligated during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. When testing transactions which occurred in the liquidation period for the 22611-047-PN01, 22611-047-ARP, 22619-047-PN01, and 22619-047-ARP grant awards, two exceptions were identified in the initial sample of five transactions. When expanding the sample, a third exception was noted, and it was concluded that it would not be appropriate to examine the remaining 14 transactions. For the above listed awards, costs must be obligated by September 30, 2023. For the three identified exceptions, an initial purchase order was made in September, but the ultimate transaction was paid to a separate vendor than the original purchase order, and this obligation was incurred in November 2023. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 22 NORTH NEWTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.403(h) states: "Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to § 200.308(e)(3)." 34 CFR 76.707 states in part: ". . . If the obligation is for- . . . (d) Performance of work other than personal services. . . . The obligation is made- On the date on which the State or subgrantee makes a binding written commitment to acquire the property. . . ." 2 CFR 200.1 states in part: ". . . Period of Performance means the total estimated time interval between the start of an initial Federal award and the planned end date . . ." 36 CFR 76.709(a) states: "If a State or a subgrantee does not obligate all of its grant or subgrant funds by the end of the fiscal year for which Congress appropriated the funds, it may obligate the remaining funds during a carryover period of one additional fiscal year." Cause Management had established an initial obligation date that occurred in September of the second fiscal year but modified the final vendor for payment. The new obligation occurred after the period in which the School Corporation was allowed to incur the expense. Effect If funds are not obligated by the end of the specified date, the grantor agency is not obligated to reimburse the School Corporation for costs incurred. This may indicate that the funding that was reimbursed, which incurred outside of the period of performance, will need to be repaid to the grantor agency, and the School Corporation will then need to support the costs with nonfederal funding. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls to ensure that no costs are incurred after the September 30 deadline and to ensure compliance with the grant agreement and the Period of Performance compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-003 Subject: Special Education Cluster (IDEA)- Earmarking Federal Agency: Department of Education Federal Programs: Special Education Grants to States, COVID-19 - Special Education Grants to States, Special Education Preschool Grants, COVID-19 - Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-054-PN01, 22611-054PN01, 22619-054-PN01, 22611-054-ARP, 22619-054-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation is a member of the Wabash-Miami Area Programs for Exceptional Children (Cooperative). During fiscal years 2022-2023 and 2023-2024, the Cooperative operated the special education programs and spent the federal money on behalf of all its members. As the grant agreements were between the Indiana Department of Education and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. The School Corporation did not have internal controls in place to ensure that the Cooperative complied with the earmarking requirements. The Cooperative did not have adequate procedures in place to ensure that the required level of expenditures for nonpublic school students with disabilities was met for each member school. The Cooperative did not have effective internal controls to ensure nonpublic school expenditures were appropriately identified and reported. The nonpublic expenditures spent did not meet the earmarking requirements for grant award numbers 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, and 22619-054-ARP. Total grant expenditures were posted as expended. The nonpublic proportionate share expenditures for each member school were determined by applying a percentage based on the total grant award to the nonpublic school total expenditures. The lack of internal controls and noncompliance were isolated to the 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, and 22619-054-ARP grant awards. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.403 states in part: . . . "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (g) Be adequately documented. . . ." 2 CFR 200.208(b) states in part: "The Federal awarding agency or pass-through entity may adjust specific Federal award conditions as needed . . ." 511 IAC 7-34-7(b) states: "The public agency, in providing special education and related services to students in nonpublic schools must expend at least an amount that is the same proportion of the public agency total subgrant under 20 U.S.C. 1411(f) as the number of nonpublic school students with disabilities, who are enrolled by their parents in nonpublic schools within its boundaries, is to the total number of students with disabilities of the same age range." Cause Through inquiry of management, they were unaware of the requirements to track nonpublic proportionate share expenditures directly for each member school. The Cooperative did implement new processes and procedures to ensure expenditures were tracked by each member school starting with the 2024 grants, and these grants were still ongoing during the audit period. Effect Without the proper implementation of an effectively designed system of internal controls, the Cooperative was unable to track expenditures for nonpublic services for each member school. Consequently, the amounts requested for reimbursement were not supported by actual expenditures but rather a percentage based on the budget per member school. Because of this, expenditures were not accurately reported to the oversight agency. Questioned Costs There were no questioned costs identified. Recommendation Management of the Cooperative should develop written policies and procedures which would require tracking of actual nonpublic proportionate share expenditures by member school. Documentation should be maintained to show how these expenditures are being tracked to ensure compliance with the Earmarking requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-003 Subject: Special Education Cluster (IDEA)- Earmarking Federal Agency: Department of Education Federal Programs: Special Education Grants to States, COVID-19 - Special Education Grants to States, Special Education Preschool Grants, COVID-19 - Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-054-PN01, 22611-054PN01, 22619-054-PN01, 22611-054-ARP, 22619-054-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation is a member of the Wabash-Miami Area Programs for Exceptional Children (Cooperative). During fiscal years 2022-2023 and 2023-2024, the Cooperative operated the special education programs and spent the federal money on behalf of all its members. As the grant agreements were between the Indiana Department of Education and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. The School Corporation did not have internal controls in place to ensure that the Cooperative complied with the earmarking requirements. The Cooperative did not have adequate procedures in place to ensure that the required level of expenditures for nonpublic school students with disabilities was met for each member school. The Cooperative did not have effective internal controls to ensure nonpublic school expenditures were appropriately identified and reported. The nonpublic expenditures spent did not meet the earmarking requirements for grant award numbers 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, and 22619-054-ARP. Total grant expenditures were posted as expended. The nonpublic proportionate share expenditures for each member school were determined by applying a percentage based on the total grant award to the nonpublic school total expenditures. The lack of internal controls and noncompliance were isolated to the 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, and 22619-054-ARP grant awards. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.403 states in part: . . . "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (g) Be adequately documented. . . ." 2 CFR 200.208(b) states in part: "The Federal awarding agency or pass-through entity may adjust specific Federal award conditions as needed . . ." 511 IAC 7-34-7(b) states: "The public agency, in providing special education and related services to students in nonpublic schools must expend at least an amount that is the same proportion of the public agency total subgrant under 20 U.S.C. 1411(f) as the number of nonpublic school students with disabilities, who are enrolled by their parents in nonpublic schools within its boundaries, is to the total number of students with disabilities of the same age range." Cause Through inquiry of management, they were unaware of the requirements to track nonpublic proportionate share expenditures directly for each member school. The Cooperative did implement new processes and procedures to ensure expenditures were tracked by each member school starting with the 2024 grants, and these grants were still ongoing during the audit period. Effect Without the proper implementation of an effectively designed system of internal controls, the Cooperative was unable to track expenditures for nonpublic services for each member school. Consequently, the amounts requested for reimbursement were not supported by actual expenditures but rather a percentage based on the budget per member school. Because of this, expenditures were not accurately reported to the oversight agency. Questioned Costs There were no questioned costs identified. Recommendation Management of the Cooperative should develop written policies and procedures which would require tracking of actual nonpublic proportionate share expenditures by member school. Documentation should be maintained to show how these expenditures are being tracked to ensure compliance with the Earmarking requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-003 Subject: Special Education Cluster (IDEA)- Earmarking Federal Agency: Department of Education Federal Programs: Special Education Grants to States, COVID-19 - Special Education Grants to States, Special Education Preschool Grants, COVID-19 - Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-054-PN01, 22611-054PN01, 22619-054-PN01, 22611-054-ARP, 22619-054-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation is a member of the Wabash-Miami Area Programs for Exceptional Children (Cooperative). During fiscal years 2022-2023 and 2023-2024, the Cooperative operated the special education programs and spent the federal money on behalf of all its members. As the grant agreements were between the Indiana Department of Education and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. The School Corporation did not have internal controls in place to ensure that the Cooperative complied with the earmarking requirements. The Cooperative did not have adequate procedures in place to ensure that the required level of expenditures for nonpublic school students with disabilities was met for each member school. The Cooperative did not have effective internal controls to ensure nonpublic school expenditures were appropriately identified and reported. The nonpublic expenditures spent did not meet the earmarking requirements for grant award numbers 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, and 22619-054-ARP. Total grant expenditures were posted as expended. The nonpublic proportionate share expenditures for each member school were determined by applying a percentage based on the total grant award to the nonpublic school total expenditures. The lack of internal controls and noncompliance were isolated to the 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, and 22619-054-ARP grant awards. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.403 states in part: . . . "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (g) Be adequately documented. . . ." 2 CFR 200.208(b) states in part: "The Federal awarding agency or pass-through entity may adjust specific Federal award conditions as needed . . ." 511 IAC 7-34-7(b) states: "The public agency, in providing special education and related services to students in nonpublic schools must expend at least an amount that is the same proportion of the public agency total subgrant under 20 U.S.C. 1411(f) as the number of nonpublic school students with disabilities, who are enrolled by their parents in nonpublic schools within its boundaries, is to the total number of students with disabilities of the same age range." Cause Through inquiry of management, they were unaware of the requirements to track nonpublic proportionate share expenditures directly for each member school. The Cooperative did implement new processes and procedures to ensure expenditures were tracked by each member school starting with the 2024 grants, and these grants were still ongoing during the audit period. Effect Without the proper implementation of an effectively designed system of internal controls, the Cooperative was unable to track expenditures for nonpublic services for each member school. Consequently, the amounts requested for reimbursement were not supported by actual expenditures but rather a percentage based on the budget per member school. Because of this, expenditures were not accurately reported to the oversight agency. Questioned Costs There were no questioned costs identified. Recommendation Management of the Cooperative should develop written policies and procedures which would require tracking of actual nonpublic proportionate share expenditures by member school. Documentation should be maintained to show how these expenditures are being tracked to ensure compliance with the Earmarking requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-003 Subject: Special Education Cluster (IDEA)- Earmarking Federal Agency: Department of Education Federal Programs: Special Education Grants to States, COVID-19 - Special Education Grants to States, Special Education Preschool Grants, COVID-19 - Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-054-PN01, 22611-054PN01, 22619-054-PN01, 22611-054-ARP, 22619-054-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation is a member of the Wabash-Miami Area Programs for Exceptional Children (Cooperative). During fiscal years 2022-2023 and 2023-2024, the Cooperative operated the special education programs and spent the federal money on behalf of all its members. As the grant agreements were between the Indiana Department of Education and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. The School Corporation did not have internal controls in place to ensure that the Cooperative complied with the earmarking requirements. The Cooperative did not have adequate procedures in place to ensure that the required level of expenditures for nonpublic school students with disabilities was met for each member school. The Cooperative did not have effective internal controls to ensure nonpublic school expenditures were appropriately identified and reported. The nonpublic expenditures spent did not meet the earmarking requirements for grant award numbers 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, and 22619-054-ARP. Total grant expenditures were posted as expended. The nonpublic proportionate share expenditures for each member school were determined by applying a percentage based on the total grant award to the nonpublic school total expenditures. The lack of internal controls and noncompliance were isolated to the 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, and 22619-054-ARP grant awards. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.403 states in part: . . . "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (g) Be adequately documented. . . ." 2 CFR 200.208(b) states in part: "The Federal awarding agency or pass-through entity may adjust specific Federal award conditions as needed . . ." 511 IAC 7-34-7(b) states: "The public agency, in providing special education and related services to students in nonpublic schools must expend at least an amount that is the same proportion of the public agency total subgrant under 20 U.S.C. 1411(f) as the number of nonpublic school students with disabilities, who are enrolled by their parents in nonpublic schools within its boundaries, is to the total number of students with disabilities of the same age range." Cause Through inquiry of management, they were unaware of the requirements to track nonpublic proportionate share expenditures directly for each member school. The Cooperative did implement new processes and procedures to ensure expenditures were tracked by each member school starting with the 2024 grants, and these grants were still ongoing during the audit period. Effect Without the proper implementation of an effectively designed system of internal controls, the Cooperative was unable to track expenditures for nonpublic services for each member school. Consequently, the amounts requested for reimbursement were not supported by actual expenditures but rather a percentage based on the budget per member school. Because of this, expenditures were not accurately reported to the oversight agency. Questioned Costs There were no questioned costs identified. Recommendation Management of the Cooperative should develop written policies and procedures which would require tracking of actual nonpublic proportionate share expenditures by member school. Documentation should be maintained to show how these expenditures are being tracked to ensure compliance with the Earmarking requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-003 Subject: Special Education Cluster (IDEA)- Earmarking Federal Agency: Department of Education Federal Programs: Special Education Grants to States, COVID-19 - Special Education Grants to States, Special Education Preschool Grants, COVID-19 - Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-054-PN01, 22611-054PN01, 22619-054-PN01, 22611-054-ARP, 22619-054-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation is a member of the Wabash-Miami Area Programs for Exceptional Children (Cooperative). During fiscal years 2022-2023 and 2023-2024, the Cooperative operated the special education programs and spent the federal money on behalf of all its members. As the grant agreements were between the Indiana Department of Education and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. The School Corporation did not have internal controls in place to ensure that the Cooperative complied with the earmarking requirements. The Cooperative did not have adequate procedures in place to ensure that the required level of expenditures for nonpublic school students with disabilities was met for each member school. The Cooperative did not have effective internal controls to ensure nonpublic school expenditures were appropriately identified and reported. The nonpublic expenditures spent did not meet the earmarking requirements for grant award numbers 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, and 22619-054-ARP. Total grant expenditures were posted as expended. The nonpublic proportionate share expenditures for each member school were determined by applying a percentage based on the total grant award to the nonpublic school total expenditures. The lack of internal controls and noncompliance were isolated to the 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, and 22619-054-ARP grant awards. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.403 states in part: . . . "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (g) Be adequately documented. . . ." 2 CFR 200.208(b) states in part: "The Federal awarding agency or pass-through entity may adjust specific Federal award conditions as needed . . ." 511 IAC 7-34-7(b) states: "The public agency, in providing special education and related services to students in nonpublic schools must expend at least an amount that is the same proportion of the public agency total subgrant under 20 U.S.C. 1411(f) as the number of nonpublic school students with disabilities, who are enrolled by their parents in nonpublic schools within its boundaries, is to the total number of students with disabilities of the same age range." Cause Through inquiry of management, they were unaware of the requirements to track nonpublic proportionate share expenditures directly for each member school. The Cooperative did implement new processes and procedures to ensure expenditures were tracked by each member school starting with the 2024 grants, and these grants were still ongoing during the audit period. Effect Without the proper implementation of an effectively designed system of internal controls, the Cooperative was unable to track expenditures for nonpublic services for each member school. Consequently, the amounts requested for reimbursement were not supported by actual expenditures but rather a percentage based on the budget per member school. Because of this, expenditures were not accurately reported to the oversight agency. Questioned Costs There were no questioned costs identified. Recommendation Management of the Cooperative should develop written policies and procedures which would require tracking of actual nonpublic proportionate share expenditures by member school. Documentation should be maintained to show how these expenditures are being tracked to ensure compliance with the Earmarking requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-003 Subject: Special Education Cluster (IDEA)- Earmarking Federal Agency: Department of Education Federal Programs: Special Education Grants to States, COVID-19 - Special Education Grants to States, Special Education Preschool Grants, COVID-19 - Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-054-PN01, 22611-054PN01, 22619-054-PN01, 22611-054-ARP, 22619-054-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation is a member of the Wabash-Miami Area Programs for Exceptional Children (Cooperative). During fiscal years 2022-2023 and 2023-2024, the Cooperative operated the special education programs and spent the federal money on behalf of all its members. As the grant agreements were between the Indiana Department of Education and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. The School Corporation did not have internal controls in place to ensure that the Cooperative complied with the earmarking requirements. The Cooperative did not have adequate procedures in place to ensure that the required level of expenditures for nonpublic school students with disabilities was met for each member school. The Cooperative did not have effective internal controls to ensure nonpublic school expenditures were appropriately identified and reported. The nonpublic expenditures spent did not meet the earmarking requirements for grant award numbers 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, and 22619-054-ARP. Total grant expenditures were posted as expended. The nonpublic proportionate share expenditures for each member school were determined by applying a percentage based on the total grant award to the nonpublic school total expenditures. The lack of internal controls and noncompliance were isolated to the 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, and 22619-054-ARP grant awards. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.403 states in part: . . . "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (g) Be adequately documented. . . ." 2 CFR 200.208(b) states in part: "The Federal awarding agency or pass-through entity may adjust specific Federal award conditions as needed . . ." 511 IAC 7-34-7(b) states: "The public agency, in providing special education and related services to students in nonpublic schools must expend at least an amount that is the same proportion of the public agency total subgrant under 20 U.S.C. 1411(f) as the number of nonpublic school students with disabilities, who are enrolled by their parents in nonpublic schools within its boundaries, is to the total number of students with disabilities of the same age range." Cause Through inquiry of management, they were unaware of the requirements to track nonpublic proportionate share expenditures directly for each member school. The Cooperative did implement new processes and procedures to ensure expenditures were tracked by each member school starting with the 2024 grants, and these grants were still ongoing during the audit period. Effect Without the proper implementation of an effectively designed system of internal controls, the Cooperative was unable to track expenditures for nonpublic services for each member school. Consequently, the amounts requested for reimbursement were not supported by actual expenditures but rather a percentage based on the budget per member school. Because of this, expenditures were not accurately reported to the oversight agency. Questioned Costs There were no questioned costs identified. Recommendation Management of the Cooperative should develop written policies and procedures which would require tracking of actual nonpublic proportionate share expenditures by member school. Documentation should be maintained to show how these expenditures are being tracked to ensure compliance with the Earmarking requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-003 Subject: Special Education Cluster (IDEA)- Earmarking Federal Agency: Department of Education Federal Programs: Special Education Grants to States, COVID-19 - Special Education Grants to States, Special Education Preschool Grants, COVID-19 - Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-054-PN01, 22611-054PN01, 22619-054-PN01, 22611-054-ARP, 22619-054-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation is a member of the Wabash-Miami Area Programs for Exceptional Children (Cooperative). During fiscal years 2022-2023 and 2023-2024, the Cooperative operated the special education programs and spent the federal money on behalf of all its members. As the grant agreements were between the Indiana Department of Education and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. The School Corporation did not have internal controls in place to ensure that the Cooperative complied with the earmarking requirements. The Cooperative did not have adequate procedures in place to ensure that the required level of expenditures for nonpublic school students with disabilities was met for each member school. The Cooperative did not have effective internal controls to ensure nonpublic school expenditures were appropriately identified and reported. The nonpublic expenditures spent did not meet the earmarking requirements for grant award numbers 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, and 22619-054-ARP. Total grant expenditures were posted as expended. The nonpublic proportionate share expenditures for each member school were determined by applying a percentage based on the total grant award to the nonpublic school total expenditures. The lack of internal controls and noncompliance were isolated to the 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, and 22619-054-ARP grant awards. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.403 states in part: . . . "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (g) Be adequately documented. . . ." 2 CFR 200.208(b) states in part: "The Federal awarding agency or pass-through entity may adjust specific Federal award conditions as needed . . ." 511 IAC 7-34-7(b) states: "The public agency, in providing special education and related services to students in nonpublic schools must expend at least an amount that is the same proportion of the public agency total subgrant under 20 U.S.C. 1411(f) as the number of nonpublic school students with disabilities, who are enrolled by their parents in nonpublic schools within its boundaries, is to the total number of students with disabilities of the same age range." Cause Through inquiry of management, they were unaware of the requirements to track nonpublic proportionate share expenditures directly for each member school. The Cooperative did implement new processes and procedures to ensure expenditures were tracked by each member school starting with the 2024 grants, and these grants were still ongoing during the audit period. Effect Without the proper implementation of an effectively designed system of internal controls, the Cooperative was unable to track expenditures for nonpublic services for each member school. Consequently, the amounts requested for reimbursement were not supported by actual expenditures but rather a percentage based on the budget per member school. Because of this, expenditures were not accurately reported to the oversight agency. Questioned Costs There were no questioned costs identified. Recommendation Management of the Cooperative should develop written policies and procedures which would require tracking of actual nonpublic proportionate share expenditures by member school. Documentation should be maintained to show how these expenditures are being tracked to ensure compliance with the Earmarking requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-003 Subject: Special Education Cluster (IDEA)- Earmarking Federal Agency: Department of Education Federal Programs: Special Education Grants to States, COVID-19 - Special Education Grants to States, Special Education Preschool Grants, COVID-19 - Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-054-PN01, 22611-054PN01, 22619-054-PN01, 22611-054-ARP, 22619-054-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation is a member of the Wabash-Miami Area Programs for Exceptional Children (Cooperative). During fiscal years 2022-2023 and 2023-2024, the Cooperative operated the special education programs and spent the federal money on behalf of all its members. As the grant agreements were between the Indiana Department of Education and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. The School Corporation did not have internal controls in place to ensure that the Cooperative complied with the earmarking requirements. The Cooperative did not have adequate procedures in place to ensure that the required level of expenditures for nonpublic school students with disabilities was met for each member school. The Cooperative did not have effective internal controls to ensure nonpublic school expenditures were appropriately identified and reported. The nonpublic expenditures spent did not meet the earmarking requirements for grant award numbers 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, and 22619-054-ARP. Total grant expenditures were posted as expended. The nonpublic proportionate share expenditures for each member school were determined by applying a percentage based on the total grant award to the nonpublic school total expenditures. The lack of internal controls and noncompliance were isolated to the 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, and 22619-054-ARP grant awards. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.403 states in part: . . . "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (g) Be adequately documented. . . ." 2 CFR 200.208(b) states in part: "The Federal awarding agency or pass-through entity may adjust specific Federal award conditions as needed . . ." 511 IAC 7-34-7(b) states: "The public agency, in providing special education and related services to students in nonpublic schools must expend at least an amount that is the same proportion of the public agency total subgrant under 20 U.S.C. 1411(f) as the number of nonpublic school students with disabilities, who are enrolled by their parents in nonpublic schools within its boundaries, is to the total number of students with disabilities of the same age range." Cause Through inquiry of management, they were unaware of the requirements to track nonpublic proportionate share expenditures directly for each member school. The Cooperative did implement new processes and procedures to ensure expenditures were tracked by each member school starting with the 2024 grants, and these grants were still ongoing during the audit period. Effect Without the proper implementation of an effectively designed system of internal controls, the Cooperative was unable to track expenditures for nonpublic services for each member school. Consequently, the amounts requested for reimbursement were not supported by actual expenditures but rather a percentage based on the budget per member school. Because of this, expenditures were not accurately reported to the oversight agency. Questioned Costs There were no questioned costs identified. Recommendation Management of the Cooperative should develop written policies and procedures which would require tracking of actual nonpublic proportionate share expenditures by member school. Documentation should be maintained to show how these expenditures are being tracked to ensure compliance with the Earmarking requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-004 Subject: Special Education Cluster (IDEA) - Level of Effort Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, 22619-054-ARP, 23611-054-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation was required to submit a Local Educational Agency (LEA) Maintenance of Effort (MOE) Calculator workbook to the Indiana Department of Education (IDOE) each year beginning with the fiscal year 2021-2022 grant. The MOE was based on the expenditure information submitted on the Form 9 for the prior fiscal year. The Form 9 (financial) data was submitted by the School Corporation to the IDOE semiannually. The data reported included the School Corporation's expenditures recorded during that period. To verify amounts used in their computation were derived from the books and records of the School Corporation, costs were reviewed to ensure they were properly classified as to fund, account, and object code and reported correctly on the Form 9. In 2020-2021 and 2021-2022, 25 transactions were sampled each year to ensure the disbursements were posted to the proper fund, account, and object code. For 5 of the 25 transactions selected in 2020-2021, as well as 4 of the 25 transactions selected in 2021-2022, appropriate supporting documentation was not provided for audit. As a result, the 9 disbursements could not be verified as to whether they were posted to the proper fund, account, and object code. The School Corporation was unable to provide documentation to support the calculation for Level of Effort included within the grant applications. In addition, the expenditure categories were not consistent with the prior grant application, and several of the expenditure categories reported did not agree to the financial records. The School Corporation did not have an oversight process in place to ensure that expenditures were classified properly to the correct fund, account, and object codes. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 34 CFR 300.203 states in part: "(a) Eligibility Standard. (1) For purposes of establishing the LEA's eligibility for an award for a fiscal year, the SEA must determine that the LEA budgets, for the education of children with disabilities, at least the same amount, from at least one of the following sources, as the LEA spent for that purpose from the same source for the most recent fiscal year for which information is available: (i) Local funds only; (ii) The combination of State and local funds; (iii) Local funds only on a per capita basis; or (iv) The combination of State and local funds on a per capita basis. . . . (b) Compliance Standard. (1) Except as provided in §§ 300.204 and 300.205, funds provided to an LEA under Part B of the Act must not be used to reduce the level of expenditures for the education of children with disabilities made by the LEA from local funds below the level of those expenditures for the preceding fiscal year. (2) An LEA meets this standard if it does not reduce the level of expenditures for the education of children with disabilities made by the LEA from at least one of the following sources below the level of those expenditures from the same source for the preceding fiscal year, except as provided in §§ 300.204 and 300.205: (i) Local funds only; (ii) The combination of State and local funds; (iii) Local funds only on a per capita basis; or (iv) The combination of State and local funds on a per capita basis. . . ." Cause The school has updated its financial system and can't produce reports from the time period tested to verify the expenditures were properly classified. Effect The School Corporation could have classified expenditures improperly and the MOE calculation could be incorrect. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation design and implement a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place to ensure compliance. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-004 Subject: Special Education Cluster (IDEA) - Level of Effort Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, 22619-054-ARP, 23611-054-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation was required to submit a Local Educational Agency (LEA) Maintenance of Effort (MOE) Calculator workbook to the Indiana Department of Education (IDOE) each year beginning with the fiscal year 2021-2022 grant. The MOE was based on the expenditure information submitted on the Form 9 for the prior fiscal year. The Form 9 (financial) data was submitted by the School Corporation to the IDOE semiannually. The data reported included the School Corporation's expenditures recorded during that period. To verify amounts used in their computation were derived from the books and records of the School Corporation, costs were reviewed to ensure they were properly classified as to fund, account, and object code and reported correctly on the Form 9. In 2020-2021 and 2021-2022, 25 transactions were sampled each year to ensure the disbursements were posted to the proper fund, account, and object code. For 5 of the 25 transactions selected in 2020-2021, as well as 4 of the 25 transactions selected in 2021-2022, appropriate supporting documentation was not provided for audit. As a result, the 9 disbursements could not be verified as to whether they were posted to the proper fund, account, and object code. The School Corporation was unable to provide documentation to support the calculation for Level of Effort included within the grant applications. In addition, the expenditure categories were not consistent with the prior grant application, and several of the expenditure categories reported did not agree to the financial records. The School Corporation did not have an oversight process in place to ensure that expenditures were classified properly to the correct fund, account, and object codes. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 34 CFR 300.203 states in part: "(a) Eligibility Standard. (1) For purposes of establishing the LEA's eligibility for an award for a fiscal year, the SEA must determine that the LEA budgets, for the education of children with disabilities, at least the same amount, from at least one of the following sources, as the LEA spent for that purpose from the same source for the most recent fiscal year for which information is available: (i) Local funds only; (ii) The combination of State and local funds; (iii) Local funds only on a per capita basis; or (iv) The combination of State and local funds on a per capita basis. . . . (b) Compliance Standard. (1) Except as provided in §§ 300.204 and 300.205, funds provided to an LEA under Part B of the Act must not be used to reduce the level of expenditures for the education of children with disabilities made by the LEA from local funds below the level of those expenditures for the preceding fiscal year. (2) An LEA meets this standard if it does not reduce the level of expenditures for the education of children with disabilities made by the LEA from at least one of the following sources below the level of those expenditures from the same source for the preceding fiscal year, except as provided in §§ 300.204 and 300.205: (i) Local funds only; (ii) The combination of State and local funds; (iii) Local funds only on a per capita basis; or (iv) The combination of State and local funds on a per capita basis. . . ." Cause The school has updated its financial system and can't produce reports from the time period tested to verify the expenditures were properly classified. Effect The School Corporation could have classified expenditures improperly and the MOE calculation could be incorrect. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation design and implement a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place to ensure compliance. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-004 Subject: Special Education Cluster (IDEA) - Level of Effort Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, 22619-054-ARP, 23611-054-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation was required to submit a Local Educational Agency (LEA) Maintenance of Effort (MOE) Calculator workbook to the Indiana Department of Education (IDOE) each year beginning with the fiscal year 2021-2022 grant. The MOE was based on the expenditure information submitted on the Form 9 for the prior fiscal year. The Form 9 (financial) data was submitted by the School Corporation to the IDOE semiannually. The data reported included the School Corporation's expenditures recorded during that period. To verify amounts used in their computation were derived from the books and records of the School Corporation, costs were reviewed to ensure they were properly classified as to fund, account, and object code and reported correctly on the Form 9. In 2020-2021 and 2021-2022, 25 transactions were sampled each year to ensure the disbursements were posted to the proper fund, account, and object code. For 5 of the 25 transactions selected in 2020-2021, as well as 4 of the 25 transactions selected in 2021-2022, appropriate supporting documentation was not provided for audit. As a result, the 9 disbursements could not be verified as to whether they were posted to the proper fund, account, and object code. The School Corporation was unable to provide documentation to support the calculation for Level of Effort included within the grant applications. In addition, the expenditure categories were not consistent with the prior grant application, and several of the expenditure categories reported did not agree to the financial records. The School Corporation did not have an oversight process in place to ensure that expenditures were classified properly to the correct fund, account, and object codes. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 34 CFR 300.203 states in part: "(a) Eligibility Standard. (1) For purposes of establishing the LEA's eligibility for an award for a fiscal year, the SEA must determine that the LEA budgets, for the education of children with disabilities, at least the same amount, from at least one of the following sources, as the LEA spent for that purpose from the same source for the most recent fiscal year for which information is available: (i) Local funds only; (ii) The combination of State and local funds; (iii) Local funds only on a per capita basis; or (iv) The combination of State and local funds on a per capita basis. . . . (b) Compliance Standard. (1) Except as provided in §§ 300.204 and 300.205, funds provided to an LEA under Part B of the Act must not be used to reduce the level of expenditures for the education of children with disabilities made by the LEA from local funds below the level of those expenditures for the preceding fiscal year. (2) An LEA meets this standard if it does not reduce the level of expenditures for the education of children with disabilities made by the LEA from at least one of the following sources below the level of those expenditures from the same source for the preceding fiscal year, except as provided in §§ 300.204 and 300.205: (i) Local funds only; (ii) The combination of State and local funds; (iii) Local funds only on a per capita basis; or (iv) The combination of State and local funds on a per capita basis. . . ." Cause The school has updated its financial system and can't produce reports from the time period tested to verify the expenditures were properly classified. Effect The School Corporation could have classified expenditures improperly and the MOE calculation could be incorrect. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation design and implement a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place to ensure compliance. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-004 Subject: Special Education Cluster (IDEA) - Level of Effort Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, 22619-054-ARP, 23611-054-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation was required to submit a Local Educational Agency (LEA) Maintenance of Effort (MOE) Calculator workbook to the Indiana Department of Education (IDOE) each year beginning with the fiscal year 2021-2022 grant. The MOE was based on the expenditure information submitted on the Form 9 for the prior fiscal year. The Form 9 (financial) data was submitted by the School Corporation to the IDOE semiannually. The data reported included the School Corporation's expenditures recorded during that period. To verify amounts used in their computation were derived from the books and records of the School Corporation, costs were reviewed to ensure they were properly classified as to fund, account, and object code and reported correctly on the Form 9. In 2020-2021 and 2021-2022, 25 transactions were sampled each year to ensure the disbursements were posted to the proper fund, account, and object code. For 5 of the 25 transactions selected in 2020-2021, as well as 4 of the 25 transactions selected in 2021-2022, appropriate supporting documentation was not provided for audit. As a result, the 9 disbursements could not be verified as to whether they were posted to the proper fund, account, and object code. The School Corporation was unable to provide documentation to support the calculation for Level of Effort included within the grant applications. In addition, the expenditure categories were not consistent with the prior grant application, and several of the expenditure categories reported did not agree to the financial records. The School Corporation did not have an oversight process in place to ensure that expenditures were classified properly to the correct fund, account, and object codes. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 34 CFR 300.203 states in part: "(a) Eligibility Standard. (1) For purposes of establishing the LEA's eligibility for an award for a fiscal year, the SEA must determine that the LEA budgets, for the education of children with disabilities, at least the same amount, from at least one of the following sources, as the LEA spent for that purpose from the same source for the most recent fiscal year for which information is available: (i) Local funds only; (ii) The combination of State and local funds; (iii) Local funds only on a per capita basis; or (iv) The combination of State and local funds on a per capita basis. . . . (b) Compliance Standard. (1) Except as provided in §§ 300.204 and 300.205, funds provided to an LEA under Part B of the Act must not be used to reduce the level of expenditures for the education of children with disabilities made by the LEA from local funds below the level of those expenditures for the preceding fiscal year. (2) An LEA meets this standard if it does not reduce the level of expenditures for the education of children with disabilities made by the LEA from at least one of the following sources below the level of those expenditures from the same source for the preceding fiscal year, except as provided in §§ 300.204 and 300.205: (i) Local funds only; (ii) The combination of State and local funds; (iii) Local funds only on a per capita basis; or (iv) The combination of State and local funds on a per capita basis. . . ." Cause The school has updated its financial system and can't produce reports from the time period tested to verify the expenditures were properly classified. Effect The School Corporation could have classified expenditures improperly and the MOE calculation could be incorrect. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation design and implement a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place to ensure compliance. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-004 Subject: Special Education Cluster (IDEA) - Level of Effort Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, 22619-054-ARP, 23611-054-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation was required to submit a Local Educational Agency (LEA) Maintenance of Effort (MOE) Calculator workbook to the Indiana Department of Education (IDOE) each year beginning with the fiscal year 2021-2022 grant. The MOE was based on the expenditure information submitted on the Form 9 for the prior fiscal year. The Form 9 (financial) data was submitted by the School Corporation to the IDOE semiannually. The data reported included the School Corporation's expenditures recorded during that period. To verify amounts used in their computation were derived from the books and records of the School Corporation, costs were reviewed to ensure they were properly classified as to fund, account, and object code and reported correctly on the Form 9. In 2020-2021 and 2021-2022, 25 transactions were sampled each year to ensure the disbursements were posted to the proper fund, account, and object code. For 5 of the 25 transactions selected in 2020-2021, as well as 4 of the 25 transactions selected in 2021-2022, appropriate supporting documentation was not provided for audit. As a result, the 9 disbursements could not be verified as to whether they were posted to the proper fund, account, and object code. The School Corporation was unable to provide documentation to support the calculation for Level of Effort included within the grant applications. In addition, the expenditure categories were not consistent with the prior grant application, and several of the expenditure categories reported did not agree to the financial records. The School Corporation did not have an oversight process in place to ensure that expenditures were classified properly to the correct fund, account, and object codes. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 34 CFR 300.203 states in part: "(a) Eligibility Standard. (1) For purposes of establishing the LEA's eligibility for an award for a fiscal year, the SEA must determine that the LEA budgets, for the education of children with disabilities, at least the same amount, from at least one of the following sources, as the LEA spent for that purpose from the same source for the most recent fiscal year for which information is available: (i) Local funds only; (ii) The combination of State and local funds; (iii) Local funds only on a per capita basis; or (iv) The combination of State and local funds on a per capita basis. . . . (b) Compliance Standard. (1) Except as provided in §§ 300.204 and 300.205, funds provided to an LEA under Part B of the Act must not be used to reduce the level of expenditures for the education of children with disabilities made by the LEA from local funds below the level of those expenditures for the preceding fiscal year. (2) An LEA meets this standard if it does not reduce the level of expenditures for the education of children with disabilities made by the LEA from at least one of the following sources below the level of those expenditures from the same source for the preceding fiscal year, except as provided in §§ 300.204 and 300.205: (i) Local funds only; (ii) The combination of State and local funds; (iii) Local funds only on a per capita basis; or (iv) The combination of State and local funds on a per capita basis. . . ." Cause The school has updated its financial system and can't produce reports from the time period tested to verify the expenditures were properly classified. Effect The School Corporation could have classified expenditures improperly and the MOE calculation could be incorrect. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation design and implement a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place to ensure compliance. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-004 Subject: Special Education Cluster (IDEA) - Level of Effort Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, 22619-054-ARP, 23611-054-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation was required to submit a Local Educational Agency (LEA) Maintenance of Effort (MOE) Calculator workbook to the Indiana Department of Education (IDOE) each year beginning with the fiscal year 2021-2022 grant. The MOE was based on the expenditure information submitted on the Form 9 for the prior fiscal year. The Form 9 (financial) data was submitted by the School Corporation to the IDOE semiannually. The data reported included the School Corporation's expenditures recorded during that period. To verify amounts used in their computation were derived from the books and records of the School Corporation, costs were reviewed to ensure they were properly classified as to fund, account, and object code and reported correctly on the Form 9. In 2020-2021 and 2021-2022, 25 transactions were sampled each year to ensure the disbursements were posted to the proper fund, account, and object code. For 5 of the 25 transactions selected in 2020-2021, as well as 4 of the 25 transactions selected in 2021-2022, appropriate supporting documentation was not provided for audit. As a result, the 9 disbursements could not be verified as to whether they were posted to the proper fund, account, and object code. The School Corporation was unable to provide documentation to support the calculation for Level of Effort included within the grant applications. In addition, the expenditure categories were not consistent with the prior grant application, and several of the expenditure categories reported did not agree to the financial records. The School Corporation did not have an oversight process in place to ensure that expenditures were classified properly to the correct fund, account, and object codes. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 34 CFR 300.203 states in part: "(a) Eligibility Standard. (1) For purposes of establishing the LEA's eligibility for an award for a fiscal year, the SEA must determine that the LEA budgets, for the education of children with disabilities, at least the same amount, from at least one of the following sources, as the LEA spent for that purpose from the same source for the most recent fiscal year for which information is available: (i) Local funds only; (ii) The combination of State and local funds; (iii) Local funds only on a per capita basis; or (iv) The combination of State and local funds on a per capita basis. . . . (b) Compliance Standard. (1) Except as provided in §§ 300.204 and 300.205, funds provided to an LEA under Part B of the Act must not be used to reduce the level of expenditures for the education of children with disabilities made by the LEA from local funds below the level of those expenditures for the preceding fiscal year. (2) An LEA meets this standard if it does not reduce the level of expenditures for the education of children with disabilities made by the LEA from at least one of the following sources below the level of those expenditures from the same source for the preceding fiscal year, except as provided in §§ 300.204 and 300.205: (i) Local funds only; (ii) The combination of State and local funds; (iii) Local funds only on a per capita basis; or (iv) The combination of State and local funds on a per capita basis. . . ." Cause The school has updated its financial system and can't produce reports from the time period tested to verify the expenditures were properly classified. Effect The School Corporation could have classified expenditures improperly and the MOE calculation could be incorrect. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation design and implement a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place to ensure compliance. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-004 Subject: Special Education Cluster (IDEA) - Level of Effort Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, 22619-054-ARP, 23611-054-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation was required to submit a Local Educational Agency (LEA) Maintenance of Effort (MOE) Calculator workbook to the Indiana Department of Education (IDOE) each year beginning with the fiscal year 2021-2022 grant. The MOE was based on the expenditure information submitted on the Form 9 for the prior fiscal year. The Form 9 (financial) data was submitted by the School Corporation to the IDOE semiannually. The data reported included the School Corporation's expenditures recorded during that period. To verify amounts used in their computation were derived from the books and records of the School Corporation, costs were reviewed to ensure they were properly classified as to fund, account, and object code and reported correctly on the Form 9. In 2020-2021 and 2021-2022, 25 transactions were sampled each year to ensure the disbursements were posted to the proper fund, account, and object code. For 5 of the 25 transactions selected in 2020-2021, as well as 4 of the 25 transactions selected in 2021-2022, appropriate supporting documentation was not provided for audit. As a result, the 9 disbursements could not be verified as to whether they were posted to the proper fund, account, and object code. The School Corporation was unable to provide documentation to support the calculation for Level of Effort included within the grant applications. In addition, the expenditure categories were not consistent with the prior grant application, and several of the expenditure categories reported did not agree to the financial records. The School Corporation did not have an oversight process in place to ensure that expenditures were classified properly to the correct fund, account, and object codes. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 34 CFR 300.203 states in part: "(a) Eligibility Standard. (1) For purposes of establishing the LEA's eligibility for an award for a fiscal year, the SEA must determine that the LEA budgets, for the education of children with disabilities, at least the same amount, from at least one of the following sources, as the LEA spent for that purpose from the same source for the most recent fiscal year for which information is available: (i) Local funds only; (ii) The combination of State and local funds; (iii) Local funds only on a per capita basis; or (iv) The combination of State and local funds on a per capita basis. . . . (b) Compliance Standard. (1) Except as provided in §§ 300.204 and 300.205, funds provided to an LEA under Part B of the Act must not be used to reduce the level of expenditures for the education of children with disabilities made by the LEA from local funds below the level of those expenditures for the preceding fiscal year. (2) An LEA meets this standard if it does not reduce the level of expenditures for the education of children with disabilities made by the LEA from at least one of the following sources below the level of those expenditures from the same source for the preceding fiscal year, except as provided in §§ 300.204 and 300.205: (i) Local funds only; (ii) The combination of State and local funds; (iii) Local funds only on a per capita basis; or (iv) The combination of State and local funds on a per capita basis. . . ." Cause The school has updated its financial system and can't produce reports from the time period tested to verify the expenditures were properly classified. Effect The School Corporation could have classified expenditures improperly and the MOE calculation could be incorrect. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation design and implement a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place to ensure compliance. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-004 Subject: Special Education Cluster (IDEA) - Level of Effort Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-054-PN01, 22611-054-PN01, 22619-054-PN01, 22611-054-ARP, 22619-054-ARP, 23611-054-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation was required to submit a Local Educational Agency (LEA) Maintenance of Effort (MOE) Calculator workbook to the Indiana Department of Education (IDOE) each year beginning with the fiscal year 2021-2022 grant. The MOE was based on the expenditure information submitted on the Form 9 for the prior fiscal year. The Form 9 (financial) data was submitted by the School Corporation to the IDOE semiannually. The data reported included the School Corporation's expenditures recorded during that period. To verify amounts used in their computation were derived from the books and records of the School Corporation, costs were reviewed to ensure they were properly classified as to fund, account, and object code and reported correctly on the Form 9. In 2020-2021 and 2021-2022, 25 transactions were sampled each year to ensure the disbursements were posted to the proper fund, account, and object code. For 5 of the 25 transactions selected in 2020-2021, as well as 4 of the 25 transactions selected in 2021-2022, appropriate supporting documentation was not provided for audit. As a result, the 9 disbursements could not be verified as to whether they were posted to the proper fund, account, and object code. The School Corporation was unable to provide documentation to support the calculation for Level of Effort included within the grant applications. In addition, the expenditure categories were not consistent with the prior grant application, and several of the expenditure categories reported did not agree to the financial records. The School Corporation did not have an oversight process in place to ensure that expenditures were classified properly to the correct fund, account, and object codes. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 34 CFR 300.203 states in part: "(a) Eligibility Standard. (1) For purposes of establishing the LEA's eligibility for an award for a fiscal year, the SEA must determine that the LEA budgets, for the education of children with disabilities, at least the same amount, from at least one of the following sources, as the LEA spent for that purpose from the same source for the most recent fiscal year for which information is available: (i) Local funds only; (ii) The combination of State and local funds; (iii) Local funds only on a per capita basis; or (iv) The combination of State and local funds on a per capita basis. . . . (b) Compliance Standard. (1) Except as provided in §§ 300.204 and 300.205, funds provided to an LEA under Part B of the Act must not be used to reduce the level of expenditures for the education of children with disabilities made by the LEA from local funds below the level of those expenditures for the preceding fiscal year. (2) An LEA meets this standard if it does not reduce the level of expenditures for the education of children with disabilities made by the LEA from at least one of the following sources below the level of those expenditures from the same source for the preceding fiscal year, except as provided in §§ 300.204 and 300.205: (i) Local funds only; (ii) The combination of State and local funds; (iii) Local funds only on a per capita basis; or (iv) The combination of State and local funds on a per capita basis. . . ." Cause The school has updated its financial system and can't produce reports from the time period tested to verify the expenditures were properly classified. Effect The School Corporation could have classified expenditures improperly and the MOE calculation could be incorrect. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation design and implement a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place to ensure compliance. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-005 Subject: COVID-19 - Education Stabilization Fund - Earmarking Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Number: 84.425U Federal Award Number and Year (or Other Identifying Number): S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Modified Opinion Condition and Context Local educational agencies that receive funds under the American Rescue Plan - Elementary and Secondary School Emergency Relief Fund (ESSER III) are to reserve not less than 20 percent of the funds to address learning loss through the implementation of evidence-based interventions, such as summer learning or summer enrichment, extended day, comprehensive afterschool programs, or extended school year programs, and ensure that such interventions respond to students' academic, social, and emotional needs and address the disproportionate impact of the coronavirus on the student subgroups. This requirement was set out in the enabling legislation for the funds and further implemented in the Education Stabilization Relief Fund Application III, which the School Corporation was required to complete for its award. As the School Corporation fully expended its ESSER III award during the audit period, earmarking was tested. The School Corporation, per its application, was required to set aside a total of $347,573 of ESSER III grant funds to be used to provide additional opportunities to students including summer school, career coach, and a social emotional academic learning liaison. Of the grant proceeds received by the School Corporation, the School Corporation budgeted the full amount for learning loss; however, the School Corporation could not provide a list of expenditures to account for the budgeted amount being spent for learning loss. There is no way to determine if expenditures were properly used for learning loss, as there are no expenditures to test. The lack of internal controls and noncompliance was isolated to the ESSER III grant noted above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.208(b) states in part: "The Federal awarding agency or pass-through entity may adjust specific Federal award conditions as needed. . . ." Section 2001(e)(1) of the ARP Act states in part: "A local educational agency that receives funds under this section— 1. shall reserve not less than 20 percent of such funds to address learning loss through the implementation of evidence-based interventions, such as summer learning or summer enrichment, extended day, comprehensive afterschool programs, or extended school year programs, and ensure that such interventions respond to students' academic, social, and emotional needs and address the disproportionate impact of the coronavirus on the student subgroups . . ." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, the required set-aside was not spent by the School Corporation. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure required earmarking requirements are met. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-005 Subject: COVID-19 - Education Stabilization Fund - Earmarking Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Number: 84.425U Federal Award Number and Year (or Other Identifying Number): S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Matching, Level of Effort, Earmarking Audit Findings: Material Weakness, Modified Opinion Condition and Context Local educational agencies that receive funds under the American Rescue Plan - Elementary and Secondary School Emergency Relief Fund (ESSER III) are to reserve not less than 20 percent of the funds to address learning loss through the implementation of evidence-based interventions, such as summer learning or summer enrichment, extended day, comprehensive afterschool programs, or extended school year programs, and ensure that such interventions respond to students' academic, social, and emotional needs and address the disproportionate impact of the coronavirus on the student subgroups. This requirement was set out in the enabling legislation for the funds and further implemented in the Education Stabilization Relief Fund Application III, which the School Corporation was required to complete for its award. As the School Corporation fully expended its ESSER III award during the audit period, earmarking was tested. The School Corporation, per its application, was required to set aside a total of $347,573 of ESSER III grant funds to be used to provide additional opportunities to students including summer school, career coach, and a social emotional academic learning liaison. Of the grant proceeds received by the School Corporation, the School Corporation budgeted the full amount for learning loss; however, the School Corporation could not provide a list of expenditures to account for the budgeted amount being spent for learning loss. There is no way to determine if expenditures were properly used for learning loss, as there are no expenditures to test. The lack of internal controls and noncompliance was isolated to the ESSER III grant noted above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.208(b) states in part: "The Federal awarding agency or pass-through entity may adjust specific Federal award conditions as needed. . . ." Section 2001(e)(1) of the ARP Act states in part: "A local educational agency that receives funds under this section— 1. shall reserve not less than 20 percent of such funds to address learning loss through the implementation of evidence-based interventions, such as summer learning or summer enrichment, extended day, comprehensive afterschool programs, or extended school year programs, and ensure that such interventions respond to students' academic, social, and emotional needs and address the disproportionate impact of the coronavirus on the student subgroups . . ." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, the required set-aside was not spent by the School Corporation. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure required earmarking requirements are met. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-006 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425U, 84.425D Federal Award Numbers and Years (or Other Identifying Numbers): 7000S425U210013, S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Repeat Finding This is a repeat finding from the immediately prior audit report. The prior audit finding number was 2022-003. Condition and Context An effective internal control system, which would include segregation of duties, was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the following compliance requirements: Reporting. The School Corporation was required to submit an annual data report to the Indiana Department of Education via JotForm. Data to be submitted includes, but not limited to, current period expenditures, prior period expenditures, and expenditures per activity. Additionally, the School Corporation was required to submit an annual data report to the Indiana Department of Education via the 3E LEA ESSER III American Rescue Plan Annual Performance Report (Annual Performance Reports). Data to be submitted includes, but is not limited to, current period expenditures and expenditures per activity. During the audit period, the School Corporation submitted the 2021-2022 data report for ESSER I - Year 3, ESSER II - Year 2, ESSER III - Year 2, and 2022-2023 data report for ESSER II - Year 3 and ESSER III - Year 3. The reports were prepared by one employee and reviewed by another employee; however, the established internal control did not allow for the prevention, or detection and correction, of errors prior to submission. The ESSER III - Year 3 report which should have covered the period of July 1, 2022 to June 30, 2023, covered the prior year (July 1, 2021 to June 30, 2022) data information. Also, the expenditures reported in the ESSER I - Year 3 and ESSER III - Year 2 submissions did not agree to underlying supporting documentation. Additionally, an internal control was not designed or implemented over submission of the Annual Performance Reports. The Annual Performance Reports were prepared by one employee without a documented oversight and review process to allow for the prevention, or detection and correction, of errors prior to submission. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." Cause Management did not develop a system of internal controls that ensured that reports submitted were for the correct activity period and supported by underlying accounting records. Effect Reports submitted to the Federal Grantor Agency did not accurately reflect the expenditure activity of the School Corporation for the reporting periods as noted in the Condition and Context above. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls, including segregation of duties, related to the grant agreement and compliance requirements listed above. An internal control system, including segregation of duties, should be designed and operate effectively to provide reasonable assurance that material noncompliance with the grant agreement or a compliance requirement of a federal program will be prevented, or detected and corrected, on a timely basis. In order to have an effective internal control system, it is important to have proper segregation of duties. This is accomplished by making sure proper oversight, reviews, and approvals take place and to have a separation of functions over certain activities related to the program. The fundamental premise of segregation of duties is that an individual or small group of individuals should not be in a position to initiate, approve, undertake, and review the same activity. The internal controls should also have documentation to evidence that the control was in place. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-006 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425U, 84.425D Federal Award Numbers and Years (or Other Identifying Numbers): 7000S425U210013, S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Repeat Finding This is a repeat finding from the immediately prior audit report. The prior audit finding number was 2022-003. Condition and Context An effective internal control system, which would include segregation of duties, was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the following compliance requirements: Reporting. The School Corporation was required to submit an annual data report to the Indiana Department of Education via JotForm. Data to be submitted includes, but not limited to, current period expenditures, prior period expenditures, and expenditures per activity. Additionally, the School Corporation was required to submit an annual data report to the Indiana Department of Education via the 3E LEA ESSER III American Rescue Plan Annual Performance Report (Annual Performance Reports). Data to be submitted includes, but is not limited to, current period expenditures and expenditures per activity. During the audit period, the School Corporation submitted the 2021-2022 data report for ESSER I - Year 3, ESSER II - Year 2, ESSER III - Year 2, and 2022-2023 data report for ESSER II - Year 3 and ESSER III - Year 3. The reports were prepared by one employee and reviewed by another employee; however, the established internal control did not allow for the prevention, or detection and correction, of errors prior to submission. The ESSER III - Year 3 report which should have covered the period of July 1, 2022 to June 30, 2023, covered the prior year (July 1, 2021 to June 30, 2022) data information. Also, the expenditures reported in the ESSER I - Year 3 and ESSER III - Year 2 submissions did not agree to underlying supporting documentation. Additionally, an internal control was not designed or implemented over submission of the Annual Performance Reports. The Annual Performance Reports were prepared by one employee without a documented oversight and review process to allow for the prevention, or detection and correction, of errors prior to submission. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." Cause Management did not develop a system of internal controls that ensured that reports submitted were for the correct activity period and supported by underlying accounting records. Effect Reports submitted to the Federal Grantor Agency did not accurately reflect the expenditure activity of the School Corporation for the reporting periods as noted in the Condition and Context above. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls, including segregation of duties, related to the grant agreement and compliance requirements listed above. An internal control system, including segregation of duties, should be designed and operate effectively to provide reasonable assurance that material noncompliance with the grant agreement or a compliance requirement of a federal program will be prevented, or detected and corrected, on a timely basis. In order to have an effective internal control system, it is important to have proper segregation of duties. This is accomplished by making sure proper oversight, reviews, and approvals take place and to have a separation of functions over certain activities related to the program. The fundamental premise of segregation of duties is that an individual or small group of individuals should not be in a position to initiate, approve, undertake, and review the same activity. The internal controls should also have documentation to evidence that the control was in place. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-006 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425U, 84.425D Federal Award Numbers and Years (or Other Identifying Numbers): 7000S425U210013, S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Repeat Finding This is a repeat finding from the immediately prior audit report. The prior audit finding number was 2022-003. Condition and Context An effective internal control system, which would include segregation of duties, was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the following compliance requirements: Reporting. The School Corporation was required to submit an annual data report to the Indiana Department of Education via JotForm. Data to be submitted includes, but not limited to, current period expenditures, prior period expenditures, and expenditures per activity. Additionally, the School Corporation was required to submit an annual data report to the Indiana Department of Education via the 3E LEA ESSER III American Rescue Plan Annual Performance Report (Annual Performance Reports). Data to be submitted includes, but is not limited to, current period expenditures and expenditures per activity. During the audit period, the School Corporation submitted the 2021-2022 data report for ESSER I - Year 3, ESSER II - Year 2, ESSER III - Year 2, and 2022-2023 data report for ESSER II - Year 3 and ESSER III - Year 3. The reports were prepared by one employee and reviewed by another employee; however, the established internal control did not allow for the prevention, or detection and correction, of errors prior to submission. The ESSER III - Year 3 report which should have covered the period of July 1, 2022 to June 30, 2023, covered the prior year (July 1, 2021 to June 30, 2022) data information. Also, the expenditures reported in the ESSER I - Year 3 and ESSER III - Year 2 submissions did not agree to underlying supporting documentation. Additionally, an internal control was not designed or implemented over submission of the Annual Performance Reports. The Annual Performance Reports were prepared by one employee without a documented oversight and review process to allow for the prevention, or detection and correction, of errors prior to submission. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." Cause Management did not develop a system of internal controls that ensured that reports submitted were for the correct activity period and supported by underlying accounting records. Effect Reports submitted to the Federal Grantor Agency did not accurately reflect the expenditure activity of the School Corporation for the reporting periods as noted in the Condition and Context above. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls, including segregation of duties, related to the grant agreement and compliance requirements listed above. An internal control system, including segregation of duties, should be designed and operate effectively to provide reasonable assurance that material noncompliance with the grant agreement or a compliance requirement of a federal program will be prevented, or detected and corrected, on a timely basis. In order to have an effective internal control system, it is important to have proper segregation of duties. This is accomplished by making sure proper oversight, reviews, and approvals take place and to have a separation of functions over certain activities related to the program. The fundamental premise of segregation of duties is that an individual or small group of individuals should not be in a position to initiate, approve, undertake, and review the same activity. The internal controls should also have documentation to evidence that the control was in place. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-006 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425U, 84.425D Federal Award Numbers and Years (or Other Identifying Numbers): 7000S425U210013, S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Repeat Finding This is a repeat finding from the immediately prior audit report. The prior audit finding number was 2022-003. Condition and Context An effective internal control system, which would include segregation of duties, was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the following compliance requirements: Reporting. The School Corporation was required to submit an annual data report to the Indiana Department of Education via JotForm. Data to be submitted includes, but not limited to, current period expenditures, prior period expenditures, and expenditures per activity. Additionally, the School Corporation was required to submit an annual data report to the Indiana Department of Education via the 3E LEA ESSER III American Rescue Plan Annual Performance Report (Annual Performance Reports). Data to be submitted includes, but is not limited to, current period expenditures and expenditures per activity. During the audit period, the School Corporation submitted the 2021-2022 data report for ESSER I - Year 3, ESSER II - Year 2, ESSER III - Year 2, and 2022-2023 data report for ESSER II - Year 3 and ESSER III - Year 3. The reports were prepared by one employee and reviewed by another employee; however, the established internal control did not allow for the prevention, or detection and correction, of errors prior to submission. The ESSER III - Year 3 report which should have covered the period of July 1, 2022 to June 30, 2023, covered the prior year (July 1, 2021 to June 30, 2022) data information. Also, the expenditures reported in the ESSER I - Year 3 and ESSER III - Year 2 submissions did not agree to underlying supporting documentation. Additionally, an internal control was not designed or implemented over submission of the Annual Performance Reports. The Annual Performance Reports were prepared by one employee without a documented oversight and review process to allow for the prevention, or detection and correction, of errors prior to submission. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." Cause Management did not develop a system of internal controls that ensured that reports submitted were for the correct activity period and supported by underlying accounting records. Effect Reports submitted to the Federal Grantor Agency did not accurately reflect the expenditure activity of the School Corporation for the reporting periods as noted in the Condition and Context above. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls, including segregation of duties, related to the grant agreement and compliance requirements listed above. An internal control system, including segregation of duties, should be designed and operate effectively to provide reasonable assurance that material noncompliance with the grant agreement or a compliance requirement of a federal program will be prevented, or detected and corrected, on a timely basis. In order to have an effective internal control system, it is important to have proper segregation of duties. This is accomplished by making sure proper oversight, reviews, and approvals take place and to have a separation of functions over certain activities related to the program. The fundamental premise of segregation of duties is that an individual or small group of individuals should not be in a position to initiate, approve, undertake, and review the same activity. The internal controls should also have documentation to evidence that the control was in place. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-006 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425U, 84.425D Federal Award Numbers and Years (or Other Identifying Numbers): 7000S425U210013, S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Repeat Finding This is a repeat finding from the immediately prior audit report. The prior audit finding number was 2022-003. Condition and Context An effective internal control system, which would include segregation of duties, was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the following compliance requirements: Reporting. The School Corporation was required to submit an annual data report to the Indiana Department of Education via JotForm. Data to be submitted includes, but not limited to, current period expenditures, prior period expenditures, and expenditures per activity. Additionally, the School Corporation was required to submit an annual data report to the Indiana Department of Education via the 3E LEA ESSER III American Rescue Plan Annual Performance Report (Annual Performance Reports). Data to be submitted includes, but is not limited to, current period expenditures and expenditures per activity. During the audit period, the School Corporation submitted the 2021-2022 data report for ESSER I - Year 3, ESSER II - Year 2, ESSER III - Year 2, and 2022-2023 data report for ESSER II - Year 3 and ESSER III - Year 3. The reports were prepared by one employee and reviewed by another employee; however, the established internal control did not allow for the prevention, or detection and correction, of errors prior to submission. The ESSER III - Year 3 report which should have covered the period of July 1, 2022 to June 30, 2023, covered the prior year (July 1, 2021 to June 30, 2022) data information. Also, the expenditures reported in the ESSER I - Year 3 and ESSER III - Year 2 submissions did not agree to underlying supporting documentation. Additionally, an internal control was not designed or implemented over submission of the Annual Performance Reports. The Annual Performance Reports were prepared by one employee without a documented oversight and review process to allow for the prevention, or detection and correction, of errors prior to submission. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." Cause Management did not develop a system of internal controls that ensured that reports submitted were for the correct activity period and supported by underlying accounting records. Effect Reports submitted to the Federal Grantor Agency did not accurately reflect the expenditure activity of the School Corporation for the reporting periods as noted in the Condition and Context above. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls, including segregation of duties, related to the grant agreement and compliance requirements listed above. An internal control system, including segregation of duties, should be designed and operate effectively to provide reasonable assurance that material noncompliance with the grant agreement or a compliance requirement of a federal program will be prevented, or detected and corrected, on a timely basis. In order to have an effective internal control system, it is important to have proper segregation of duties. This is accomplished by making sure proper oversight, reviews, and approvals take place and to have a separation of functions over certain activities related to the program. The fundamental premise of segregation of duties is that an individual or small group of individuals should not be in a position to initiate, approve, undertake, and review the same activity. The internal controls should also have documentation to evidence that the control was in place. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-006 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425U, 84.425D Federal Award Numbers and Years (or Other Identifying Numbers): 7000S425U210013, S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Repeat Finding This is a repeat finding from the immediately prior audit report. The prior audit finding number was 2022-003. Condition and Context An effective internal control system, which would include segregation of duties, was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the following compliance requirements: Reporting. The School Corporation was required to submit an annual data report to the Indiana Department of Education via JotForm. Data to be submitted includes, but not limited to, current period expenditures, prior period expenditures, and expenditures per activity. Additionally, the School Corporation was required to submit an annual data report to the Indiana Department of Education via the 3E LEA ESSER III American Rescue Plan Annual Performance Report (Annual Performance Reports). Data to be submitted includes, but is not limited to, current period expenditures and expenditures per activity. During the audit period, the School Corporation submitted the 2021-2022 data report for ESSER I - Year 3, ESSER II - Year 2, ESSER III - Year 2, and 2022-2023 data report for ESSER II - Year 3 and ESSER III - Year 3. The reports were prepared by one employee and reviewed by another employee; however, the established internal control did not allow for the prevention, or detection and correction, of errors prior to submission. The ESSER III - Year 3 report which should have covered the period of July 1, 2022 to June 30, 2023, covered the prior year (July 1, 2021 to June 30, 2022) data information. Also, the expenditures reported in the ESSER I - Year 3 and ESSER III - Year 2 submissions did not agree to underlying supporting documentation. Additionally, an internal control was not designed or implemented over submission of the Annual Performance Reports. The Annual Performance Reports were prepared by one employee without a documented oversight and review process to allow for the prevention, or detection and correction, of errors prior to submission. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." Cause Management did not develop a system of internal controls that ensured that reports submitted were for the correct activity period and supported by underlying accounting records. Effect Reports submitted to the Federal Grantor Agency did not accurately reflect the expenditure activity of the School Corporation for the reporting periods as noted in the Condition and Context above. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls, including segregation of duties, related to the grant agreement and compliance requirements listed above. An internal control system, including segregation of duties, should be designed and operate effectively to provide reasonable assurance that material noncompliance with the grant agreement or a compliance requirement of a federal program will be prevented, or detected and corrected, on a timely basis. In order to have an effective internal control system, it is important to have proper segregation of duties. This is accomplished by making sure proper oversight, reviews, and approvals take place and to have a separation of functions over certain activities related to the program. The fundamental premise of segregation of duties is that an individual or small group of individuals should not be in a position to initiate, approve, undertake, and review the same activity. The internal controls should also have documentation to evidence that the control was in place. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Finding 2024‐002 Procurement Information on the federal/state program: Federal Programs: Research and Development Cluster (R&D) ALN: 93.855 Criteria or specific requirement (including statutory, regulatory or other citation): Federal Program 2 CFR 200.303(a) 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 200.318 (i) General Procurement Standards states, “the non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price.” Condition: The College did not maintain records for procurements sufficient to detail the history of procurement, including the rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Questioned costs: $65,815 Section III – Federal Award Findings and Questioned Costs (continued) Context: EY selected and tested 8 procurements over $50,000 with expenditures totaling, $1,779,434 from a population of $8,490,052 procurements over $50,000 during the year ended June 30, 2024. Of the 8 expenditures selected for testing 1 procurement totaling $65,815 did not have evidence of sole source justification. Effect or potential effect: The College did not comply with the general procurement standards and methods of procurement to be followed per the Uniform Guidance to maintain sufficient detail of the history of the procurement, including the rationale of the method of procurement. Cause: The College did not have effective internal controls and procedures in place to ensure the College maintained records for procurements sufficient to detail the history of procurement, including the rationale for the method of procurement and other required elements. Identification as a repeat finding, if applicable: This is not a repeat finding Recommendation: The College should retain written documentation for procurements, documenting the history of the procurement prior to the procurement of goods or services including, but not limited to, the rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Views of responsible officials and planned corrective actions: Management agrees with the finding and has developed a plan to ensure that documentation is retained for sole source procurements.
Finding 2024‐002 Procurement Information on the federal/state program: Federal Programs: Research and Development Cluster (R&D) ALN: 93.855 Criteria or specific requirement (including statutory, regulatory or other citation): Federal Program 2 CFR 200.303(a) 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 200.318 (i) General Procurement Standards states, “the non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price.” Condition: The College did not maintain records for procurements sufficient to detail the history of procurement, including the rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Questioned costs: $65,815 Section III – Federal Award Findings and Questioned Costs (continued) Context: EY selected and tested 8 procurements over $50,000 with expenditures totaling, $1,779,434 from a population of $8,490,052 procurements over $50,000 during the year ended June 30, 2024. Of the 8 expenditures selected for testing 1 procurement totaling $65,815 did not have evidence of sole source justification. Effect or potential effect: The College did not comply with the general procurement standards and methods of procurement to be followed per the Uniform Guidance to maintain sufficient detail of the history of the procurement, including the rationale of the method of procurement. Cause: The College did not have effective internal controls and procedures in place to ensure the College maintained records for procurements sufficient to detail the history of procurement, including the rationale for the method of procurement and other required elements. Identification as a repeat finding, if applicable: This is not a repeat finding Recommendation: The College should retain written documentation for procurements, documenting the history of the procurement prior to the procurement of goods or services including, but not limited to, the rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Views of responsible officials and planned corrective actions: Management agrees with the finding and has developed a plan to ensure that documentation is retained for sole source procurements.
Finding 2024‐003 Indirect Cost Information on the federal/state program: Federal Award agency; Research and Development Cluster COVID-19 Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) ALN: Various 21.027 Criteria or specific requirement (including statutory, regulatory or other citation): Internal Controls Federal Awards 2 CFR Section 200.303 of the Uniform Guidance states the following regarding internal control: “The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: The College did not retain documentation and evidence of review of the indirect cost amounts being charged to the R&D and CSLFRF programs. Management performed a monthly control that included reviewing a sample of indirect costs charged to grants on a sample basis. The College had a new ERP implementation that went into effect on January 1, 2024. Management did not perform the monthly control subsequent to the ERP implementation for the last 6 months of year. Questioned costs: None Section III – Federal Award Findings and Questioned Costs (continued) Context: During our testing over indirect cost, we selected 2 months during FY24 to test managements control. We observed that during FY24, BCM had a mid year ERP implementation in January 2024. After the ERP implementation, management no longer performed the monthly control for the remainder of FY24. As such for 6 months during FY24, the control was not in place. Effect or potential effect: The incorrect indirect cost rate could be applied to a grant. Cause: Management’s internal control over the review and approval of indirect cost expenditures for compliance was not consistently documented. Identification as a repeat finding, if applicable: This is not a repeat finding Recommendation: The College should reassess its internal controls over the review and approval of indirect cost expenditures post ERP implementation and ensure documentation is retained to evidence review and approval to support the allowability of the expenditure. Views of responsible officials and planned corrective actions: Management agrees with the finding and has developed a plan to ensure indirect costs are reviewed.
Finding 2024‐003 Indirect Cost Information on the federal/state program: Federal Award agency; Research and Development Cluster COVID-19 Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) ALN: Various 21.027 Criteria or specific requirement (including statutory, regulatory or other citation): Internal Controls Federal Awards 2 CFR Section 200.303 of the Uniform Guidance states the following regarding internal control: “The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: The College did not retain documentation and evidence of review of the indirect cost amounts being charged to the R&D and CSLFRF programs. Management performed a monthly control that included reviewing a sample of indirect costs charged to grants on a sample basis. The College had a new ERP implementation that went into effect on January 1, 2024. Management did not perform the monthly control subsequent to the ERP implementation for the last 6 months of year. Questioned costs: None Section III – Federal Award Findings and Questioned Costs (continued) Context: During our testing over indirect cost, we selected 2 months during FY24 to test managements control. We observed that during FY24, BCM had a mid year ERP implementation in January 2024. After the ERP implementation, management no longer performed the monthly control for the remainder of FY24. As such for 6 months during FY24, the control was not in place. Effect or potential effect: The incorrect indirect cost rate could be applied to a grant. Cause: Management’s internal control over the review and approval of indirect cost expenditures for compliance was not consistently documented. Identification as a repeat finding, if applicable: This is not a repeat finding Recommendation: The College should reassess its internal controls over the review and approval of indirect cost expenditures post ERP implementation and ensure documentation is retained to evidence review and approval to support the allowability of the expenditure. Views of responsible officials and planned corrective actions: Management agrees with the finding and has developed a plan to ensure indirect costs are reviewed.
Finding 2024‐003 Indirect Cost Information on the federal/state program: Federal Award agency; Research and Development Cluster COVID-19 Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) ALN: Various 21.027 Criteria or specific requirement (including statutory, regulatory or other citation): Internal Controls Federal Awards 2 CFR Section 200.303 of the Uniform Guidance states the following regarding internal control: “The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: The College did not retain documentation and evidence of review of the indirect cost amounts being charged to the R&D and CSLFRF programs. Management performed a monthly control that included reviewing a sample of indirect costs charged to grants on a sample basis. The College had a new ERP implementation that went into effect on January 1, 2024. Management did not perform the monthly control subsequent to the ERP implementation for the last 6 months of year. Questioned costs: None Section III – Federal Award Findings and Questioned Costs (continued) Context: During our testing over indirect cost, we selected 2 months during FY24 to test managements control. We observed that during FY24, BCM had a mid year ERP implementation in January 2024. After the ERP implementation, management no longer performed the monthly control for the remainder of FY24. As such for 6 months during FY24, the control was not in place. Effect or potential effect: The incorrect indirect cost rate could be applied to a grant. Cause: Management’s internal control over the review and approval of indirect cost expenditures for compliance was not consistently documented. Identification as a repeat finding, if applicable: This is not a repeat finding Recommendation: The College should reassess its internal controls over the review and approval of indirect cost expenditures post ERP implementation and ensure documentation is retained to evidence review and approval to support the allowability of the expenditure. Views of responsible officials and planned corrective actions: Management agrees with the finding and has developed a plan to ensure indirect costs are reviewed.
Finding 2024‐003 Indirect Cost Information on the federal/state program: Federal Award agency; Research and Development Cluster COVID-19 Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) ALN: Various 21.027 Criteria or specific requirement (including statutory, regulatory or other citation): Internal Controls Federal Awards 2 CFR Section 200.303 of the Uniform Guidance states the following regarding internal control: “The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: The College did not retain documentation and evidence of review of the indirect cost amounts being charged to the R&D and CSLFRF programs. Management performed a monthly control that included reviewing a sample of indirect costs charged to grants on a sample basis. The College had a new ERP implementation that went into effect on January 1, 2024. Management did not perform the monthly control subsequent to the ERP implementation for the last 6 months of year. Questioned costs: None Section III – Federal Award Findings and Questioned Costs (continued) Context: During our testing over indirect cost, we selected 2 months during FY24 to test managements control. We observed that during FY24, BCM had a mid year ERP implementation in January 2024. After the ERP implementation, management no longer performed the monthly control for the remainder of FY24. As such for 6 months during FY24, the control was not in place. Effect or potential effect: The incorrect indirect cost rate could be applied to a grant. Cause: Management’s internal control over the review and approval of indirect cost expenditures for compliance was not consistently documented. Identification as a repeat finding, if applicable: This is not a repeat finding Recommendation: The College should reassess its internal controls over the review and approval of indirect cost expenditures post ERP implementation and ensure documentation is retained to evidence review and approval to support the allowability of the expenditure. Views of responsible officials and planned corrective actions: Management agrees with the finding and has developed a plan to ensure indirect costs are reviewed.
Finding 2024‐003 Indirect Cost Information on the federal/state program: Federal Award agency; Research and Development Cluster COVID-19 Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) ALN: Various 21.027 Criteria or specific requirement (including statutory, regulatory or other citation): Internal Controls Federal Awards 2 CFR Section 200.303 of the Uniform Guidance states the following regarding internal control: “The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: The College did not retain documentation and evidence of review of the indirect cost amounts being charged to the R&D and CSLFRF programs. Management performed a monthly control that included reviewing a sample of indirect costs charged to grants on a sample basis. The College had a new ERP implementation that went into effect on January 1, 2024. Management did not perform the monthly control subsequent to the ERP implementation for the last 6 months of year. Questioned costs: None Section III – Federal Award Findings and Questioned Costs (continued) Context: During our testing over indirect cost, we selected 2 months during FY24 to test managements control. We observed that during FY24, BCM had a mid year ERP implementation in January 2024. After the ERP implementation, management no longer performed the monthly control for the remainder of FY24. As such for 6 months during FY24, the control was not in place. Effect or potential effect: The incorrect indirect cost rate could be applied to a grant. Cause: Management’s internal control over the review and approval of indirect cost expenditures for compliance was not consistently documented. Identification as a repeat finding, if applicable: This is not a repeat finding Recommendation: The College should reassess its internal controls over the review and approval of indirect cost expenditures post ERP implementation and ensure documentation is retained to evidence review and approval to support the allowability of the expenditure. Views of responsible officials and planned corrective actions: Management agrees with the finding and has developed a plan to ensure indirect costs are reviewed.
Finding 2024‐003 Indirect Cost Information on the federal/state program: Federal Award agency; Research and Development Cluster COVID-19 Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) ALN: Various 21.027 Criteria or specific requirement (including statutory, regulatory or other citation): Internal Controls Federal Awards 2 CFR Section 200.303 of the Uniform Guidance states the following regarding internal control: “The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: The College did not retain documentation and evidence of review of the indirect cost amounts being charged to the R&D and CSLFRF programs. Management performed a monthly control that included reviewing a sample of indirect costs charged to grants on a sample basis. The College had a new ERP implementation that went into effect on January 1, 2024. Management did not perform the monthly control subsequent to the ERP implementation for the last 6 months of year. Questioned costs: None Section III – Federal Award Findings and Questioned Costs (continued) Context: During our testing over indirect cost, we selected 2 months during FY24 to test managements control. We observed that during FY24, BCM had a mid year ERP implementation in January 2024. After the ERP implementation, management no longer performed the monthly control for the remainder of FY24. As such for 6 months during FY24, the control was not in place. Effect or potential effect: The incorrect indirect cost rate could be applied to a grant. Cause: Management’s internal control over the review and approval of indirect cost expenditures for compliance was not consistently documented. Identification as a repeat finding, if applicable: This is not a repeat finding Recommendation: The College should reassess its internal controls over the review and approval of indirect cost expenditures post ERP implementation and ensure documentation is retained to evidence review and approval to support the allowability of the expenditure. Views of responsible officials and planned corrective actions: Management agrees with the finding and has developed a plan to ensure indirect costs are reviewed.
Finding 2024‐003 Indirect Cost Information on the federal/state program: Federal Award agency; Research and Development Cluster COVID-19 Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) ALN: Various 21.027 Criteria or specific requirement (including statutory, regulatory or other citation): Internal Controls Federal Awards 2 CFR Section 200.303 of the Uniform Guidance states the following regarding internal control: “The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: The College did not retain documentation and evidence of review of the indirect cost amounts being charged to the R&D and CSLFRF programs. Management performed a monthly control that included reviewing a sample of indirect costs charged to grants on a sample basis. The College had a new ERP implementation that went into effect on January 1, 2024. Management did not perform the monthly control subsequent to the ERP implementation for the last 6 months of year. Questioned costs: None Section III – Federal Award Findings and Questioned Costs (continued) Context: During our testing over indirect cost, we selected 2 months during FY24 to test managements control. We observed that during FY24, BCM had a mid year ERP implementation in January 2024. After the ERP implementation, management no longer performed the monthly control for the remainder of FY24. As such for 6 months during FY24, the control was not in place. Effect or potential effect: The incorrect indirect cost rate could be applied to a grant. Cause: Management’s internal control over the review and approval of indirect cost expenditures for compliance was not consistently documented. Identification as a repeat finding, if applicable: This is not a repeat finding Recommendation: The College should reassess its internal controls over the review and approval of indirect cost expenditures post ERP implementation and ensure documentation is retained to evidence review and approval to support the allowability of the expenditure. Views of responsible officials and planned corrective actions: Management agrees with the finding and has developed a plan to ensure indirect costs are reviewed.
Finding 2024‐003 Indirect Cost Information on the federal/state program: Federal Award agency; Research and Development Cluster COVID-19 Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) ALN: Various 21.027 Criteria or specific requirement (including statutory, regulatory or other citation): Internal Controls Federal Awards 2 CFR Section 200.303 of the Uniform Guidance states the following regarding internal control: “The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: The College did not retain documentation and evidence of review of the indirect cost amounts being charged to the R&D and CSLFRF programs. Management performed a monthly control that included reviewing a sample of indirect costs charged to grants on a sample basis. The College had a new ERP implementation that went into effect on January 1, 2024. Management did not perform the monthly control subsequent to the ERP implementation for the last 6 months of year. Questioned costs: None Section III – Federal Award Findings and Questioned Costs (continued) Context: During our testing over indirect cost, we selected 2 months during FY24 to test managements control. We observed that during FY24, BCM had a mid year ERP implementation in January 2024. After the ERP implementation, management no longer performed the monthly control for the remainder of FY24. As such for 6 months during FY24, the control was not in place. Effect or potential effect: The incorrect indirect cost rate could be applied to a grant. Cause: Management’s internal control over the review and approval of indirect cost expenditures for compliance was not consistently documented. Identification as a repeat finding, if applicable: This is not a repeat finding Recommendation: The College should reassess its internal controls over the review and approval of indirect cost expenditures post ERP implementation and ensure documentation is retained to evidence review and approval to support the allowability of the expenditure. Views of responsible officials and planned corrective actions: Management agrees with the finding and has developed a plan to ensure indirect costs are reviewed.
Finding 2024‐003 Indirect Cost Information on the federal/state program: Federal Award agency; Research and Development Cluster COVID-19 Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) ALN: Various 21.027 Criteria or specific requirement (including statutory, regulatory or other citation): Internal Controls Federal Awards 2 CFR Section 200.303 of the Uniform Guidance states the following regarding internal control: “The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: The College did not retain documentation and evidence of review of the indirect cost amounts being charged to the R&D and CSLFRF programs. Management performed a monthly control that included reviewing a sample of indirect costs charged to grants on a sample basis. The College had a new ERP implementation that went into effect on January 1, 2024. Management did not perform the monthly control subsequent to the ERP implementation for the last 6 months of year. Questioned costs: None Section III – Federal Award Findings and Questioned Costs (continued) Context: During our testing over indirect cost, we selected 2 months during FY24 to test managements control. We observed that during FY24, BCM had a mid year ERP implementation in January 2024. After the ERP implementation, management no longer performed the monthly control for the remainder of FY24. As such for 6 months during FY24, the control was not in place. Effect or potential effect: The incorrect indirect cost rate could be applied to a grant. Cause: Management’s internal control over the review and approval of indirect cost expenditures for compliance was not consistently documented. Identification as a repeat finding, if applicable: This is not a repeat finding Recommendation: The College should reassess its internal controls over the review and approval of indirect cost expenditures post ERP implementation and ensure documentation is retained to evidence review and approval to support the allowability of the expenditure. Views of responsible officials and planned corrective actions: Management agrees with the finding and has developed a plan to ensure indirect costs are reviewed.
Finding 2024‐003 Indirect Cost Information on the federal/state program: Federal Award agency; Research and Development Cluster COVID-19 Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) ALN: Various 21.027 Criteria or specific requirement (including statutory, regulatory or other citation): Internal Controls Federal Awards 2 CFR Section 200.303 of the Uniform Guidance states the following regarding internal control: “The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: The College did not retain documentation and evidence of review of the indirect cost amounts being charged to the R&D and CSLFRF programs. Management performed a monthly control that included reviewing a sample of indirect costs charged to grants on a sample basis. The College had a new ERP implementation that went into effect on January 1, 2024. Management did not perform the monthly control subsequent to the ERP implementation for the last 6 months of year. Questioned costs: None Section III – Federal Award Findings and Questioned Costs (continued) Context: During our testing over indirect cost, we selected 2 months during FY24 to test managements control. We observed that during FY24, BCM had a mid year ERP implementation in January 2024. After the ERP implementation, management no longer performed the monthly control for the remainder of FY24. As such for 6 months during FY24, the control was not in place. Effect or potential effect: The incorrect indirect cost rate could be applied to a grant. Cause: Management’s internal control over the review and approval of indirect cost expenditures for compliance was not consistently documented. Identification as a repeat finding, if applicable: This is not a repeat finding Recommendation: The College should reassess its internal controls over the review and approval of indirect cost expenditures post ERP implementation and ensure documentation is retained to evidence review and approval to support the allowability of the expenditure. Views of responsible officials and planned corrective actions: Management agrees with the finding and has developed a plan to ensure indirect costs are reviewed.
Finding 2024‐003 Indirect Cost Information on the federal/state program: Federal Award agency; Research and Development Cluster COVID-19 Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) ALN: Various 21.027 Criteria or specific requirement (including statutory, regulatory or other citation): Internal Controls Federal Awards 2 CFR Section 200.303 of the Uniform Guidance states the following regarding internal control: “The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: The College did not retain documentation and evidence of review of the indirect cost amounts being charged to the R&D and CSLFRF programs. Management performed a monthly control that included reviewing a sample of indirect costs charged to grants on a sample basis. The College had a new ERP implementation that went into effect on January 1, 2024. Management did not perform the monthly control subsequent to the ERP implementation for the last 6 months of year. Questioned costs: None Section III – Federal Award Findings and Questioned Costs (continued) Context: During our testing over indirect cost, we selected 2 months during FY24 to test managements control. We observed that during FY24, BCM had a mid year ERP implementation in January 2024. After the ERP implementation, management no longer performed the monthly control for the remainder of FY24. As such for 6 months during FY24, the control was not in place. Effect or potential effect: The incorrect indirect cost rate could be applied to a grant. Cause: Management’s internal control over the review and approval of indirect cost expenditures for compliance was not consistently documented. Identification as a repeat finding, if applicable: This is not a repeat finding Recommendation: The College should reassess its internal controls over the review and approval of indirect cost expenditures post ERP implementation and ensure documentation is retained to evidence review and approval to support the allowability of the expenditure. Views of responsible officials and planned corrective actions: Management agrees with the finding and has developed a plan to ensure indirect costs are reviewed.