2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
2023-003 – Equipment and real property management Cluster: Research and Development Sponsoring Agency: Various Award Names: All awards for 3 campuses with federal equipment expenditures in the Schedules of Expenditures of Federal Awards (“SEFA”) Award Numbers: Various Assistance Listing Titles: Various Assistance Listing Numbers: All awards for 3 campuses with equipment expenditures in the SEFA Award Year: 2022-2023 Pass-through entity: All pass-through awards for 3 campuses with equipment expenditures in the SEFA Criteria 2 CFR 200.313(d) requires that a physical inventory of equipment acquired in whole or in part under a Federal award must be taken and the results reconciled with the property records at least once every two years. Condition Through our testing of federal equipment and real property management across three campuses, we noted the following: • One campus has a control by which all custodians are responsible for the completion of their federal equipment inventory on a 2-year rolling basis, which includes timely review and approval of the Physical Inventory Certification Form. Through our testing of 12 custodians, out of a population of 120, we noted that 11 custodians did not complete the Physical Inventory Certification Form within the two-year timeframe. On average these certifications were completed 263 days late. • At a second campus, we noted a similar control in which a Department Inventorial Equipment Certification form is periodically required to be signed and submitted by each custodian. Through our testing of timeliness and approval of equipment inventories being performed by custodian, we selected 15 custodians, out of a population of 153, to ensure timely submission and approval of this form and noted the following: o Three of the sampled custodians submitted forms in early FY2022 and the next form was not due based on campus policy until FY2024; due dates for which were all beyond the two-year requirement. On average, using the scheduled due dates based on campus policy, these inventories would be 63 days late. o Eleven of the sampled custodians submitted the latest certifications during FY2022, FY2023 or FY2024, however, when compared to the date of the previous submission, the submissions were on average 274 days late when compared to the Uniform Guidance biennial requirement. • At a third campus, we selected seven custodians for equipment observation procedures and for those seven custodians also obtained their annual inventory certification form, which was completed on a timely basis. One of the certifications that is attested to on this form is that the last inventory date on the equipment for which the custodian is responsible has been inventoried within the last two years. Through review of the underlying detail for these seven custodians, we noted two custodians with equipment that had not been inventoried within the two-year timeframe. For context, one custodian had 261 out of 972 pieces of equipment that had not been inventoried within the two year-period; a second custodian had 542 out of 569 assets that had not been inventoried within the two-year period, including 473 pieces having last inventory dates during calendar years 2012-2019. Cause • In the case of the first campus, we understand that many of the custodians continue to work remotely and adhering to the required timeframe has been difficult to enforce. • In the case of the second campus, federal equipment inventory dates are assigned based on a system algorithm, which allocates due dates ratably across the custodians. This algorithm does not, however, take into account when the last inventory was completed and the biennial requirement. Additionally, we understand this campus has custodians working remotely and request extensions on their inventory requirement, however, when granting such extensions, the biennial requirement is not considered. • In the case of the third campus, the custodians indicated that they completed the inventories as certified, however, due to the volume of assets they either do not update the dates in the equipment management system or update them well after-the-fact due to a manual process. There is no central review of the underlying equipment management system detail to validate “last inventory dates” and thus no monitoring to ensure inventory dates are updated by custodians in the equipment management system. Effect Federal equipment inventories that are not completed in a timely manner, could result in assets purchased with federal funds not being appropriately safeguarded. Questioned Costs None noted. Recommendation We recommend the campuses review their federal equipment policies and procedures and implement controls to ensure federal equipment inventories are completed on a timely basis in accordance with the Uniform Guidance requirements and that underlying details in the equipment management systems get updated timely, as applicable. Management’s Views and Corrective Action Plan Management’s response is included in “Management’s Views and Corrective Action Plan” included at the end of this report after the summary schedule of status of prior audit findings.
FINDING 2023-003 Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Number: 84.425U Federal Award Number: S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Modified Opinion Condition and Context A property record or capital asset listing which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number (FAIN)), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. The School Corporation purchased the following items during the audit period: an HVAC system in the amount of $1,420,440; paving for a traffic improvement project in the amount of $1,069,051; and a dehumidification unit for the pool in the amount of $328,076. The dehumidification unit for the pool was added to the capital asset listing; however, the source of the funding, who holds title, percentage of federal participation in the project costs for the federal award, and the condition of property were not noted. The HVAC system and the traffic improvement project were not included on the asset listing. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 18 NORTH ADAMS COMMUNITY SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.313(d)(1) states: "Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property." 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, assets purchased with federal dollars were not properly added to the School Corporation's asset listing. In addition, the one asset added did not have all the required elements. 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 asset records include all the necessary information and new assets are added. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-003 Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Number: 84.425U Federal Award Number: S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Modified Opinion Condition and Context A property record or capital asset listing which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number (FAIN)), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. The School Corporation purchased the following items during the audit period: an HVAC system in the amount of $1,420,440; paving for a traffic improvement project in the amount of $1,069,051; and a dehumidification unit for the pool in the amount of $328,076. The dehumidification unit for the pool was added to the capital asset listing; however, the source of the funding, who holds title, percentage of federal participation in the project costs for the federal award, and the condition of property were not noted. The HVAC system and the traffic improvement project were not included on the asset listing. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 18 NORTH ADAMS COMMUNITY SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.313(d)(1) states: "Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property." 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, assets purchased with federal dollars were not properly added to the School Corporation's asset listing. In addition, the one asset added did not have all the required elements. 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 asset records include all the necessary information and new assets are added. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-003 Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property Management 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: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. A property record or capital asset listing which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number (FAIN)), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. During fiscal year 2022-2023, the School Corporation purchased two buses, totaling $168,884, out of ESSER III funds which exceeded the School Corporation's capitalization threshold. The two buses were added to the School Corporation's capital asset listing; however, the capital asset listing was missing a serial number or other identification number, the source of funding for the property (including the federal award identification number (FAIN)), who holds title, and the percentage of federal participation in the project costs. Additionally, the School Corporation did not complete a capital asset inventory every two years as required. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.313(d) states in part: "Management requirements. Procedures for managing equipment (including replacement equipment), whether acquired in whole or in part under a Federal award, until disposition takes place will, as a minimum, meet the following requirements: INDIANA STATE BOARD OF ACCOUNTS 20 MEDORA COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (1) Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. (2) A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. . . ." 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 capital asset listing did not include all the required information and the required inventory was not completed. 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 asset records include all the necessary information and an inventory is taken every two years. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-003 Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property Management 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: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. A property record or capital asset listing which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number (FAIN)), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. During fiscal year 2022-2023, the School Corporation purchased two buses, totaling $168,884, out of ESSER III funds which exceeded the School Corporation's capitalization threshold. The two buses were added to the School Corporation's capital asset listing; however, the capital asset listing was missing a serial number or other identification number, the source of funding for the property (including the federal award identification number (FAIN)), who holds title, and the percentage of federal participation in the project costs. Additionally, the School Corporation did not complete a capital asset inventory every two years as required. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.313(d) states in part: "Management requirements. Procedures for managing equipment (including replacement equipment), whether acquired in whole or in part under a Federal award, until disposition takes place will, as a minimum, meet the following requirements: INDIANA STATE BOARD OF ACCOUNTS 20 MEDORA COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (1) Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. (2) A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. . . ." 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 capital asset listing did not include all the required information and the required inventory was not completed. 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 asset records include all the necessary information and an inventory is taken every two years. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
U.S. Department of Education Fund for the Improvement of Postsecondary Education - 84.116Z Award Number - P116Z220080 Criteria or Specific Requirement - Equipment and Real Property Management Non-federal entities other than states must follow 2 CFR sections 200.313 which require that property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property (2 CFR section 200.313(d)(1)). Condition - The College property records do not contain all of the information required under 2 CFR section 200.313. Questioned Costs - None noted. Context - Approximately $1,950,000 of the $2,081,000 of Federal expenditures in fiscal year 2023 were for equipment and real property. When performing testing, we noted that the College did not have proper tracking procedures in place for property records as the records did not contain a serial number or other identification number, there was no indication in the property records that the equipment and real property was purchased with Federal funds and the location, use and condition of the property was not identified. Cause - The College has not historically received federal awards that would allow for purchase of equipment and real property and therefore was not aware of the specific requirements. Effect - Failure to properly track and maintain equipment purchased with Federal funding could ultimately lead to loss of equipment procured with Federal funds or noncompliance with Uniform Guidance requirements. Identification as a repeat finding, if applicable - Not applicable. Recommendation - We recommend that management take necessary steps to ensure compliance with equipment and real property maintenance requirements to comply with 2 CFR section 200.313. View of Responsible Official and Planned Corrective Actions – Management agrees with the stated finding and has implemented a corrective action plan.
2023-002. Equipment and Real Property Management Education Stabilization Fund (ESF) COVID-19: Elementary and Secondary School Emergency Relief Fund ALN: 84.425D COVID-19: American Rescue Plan – Elementary and Secondary School Emergency Relief ALN: 84.425U COVID-19: American Rescue Plan – Elementary and Secondary School Emergency Relief – Homeless Children and Youth ALN: 84.425W Criteria: 2 CFR §200.313 of the Uniform Guidance issued by the U.S. Office of Management and Budget requires management to have procedures for managing equipment (including replacement equipment), whether acquired in whole or in part under a Federal award, until disposition takes place. This includes maintaining property records that include a description of the property, a serial number or other identification number, the source of funding for the property, including the Federal Award Identification Number (FAIN), and who holds title. In addition, it requires the District to track the acquisition date and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. Condition: The District did not include equipment purchased with Federal grant funds in its current year additions in the District’s capital assets inventory records. Cause: The District uses specific codes to identify and track equipment purchased during the year. Since the District did not have adequate procedures in place to review and reconcile the District’s equipment purchases codes to the annual capital asset additions, the equipment purchased under the Federal grants was inadvertently omitted from the current year capital assets inventory additions. Effect: The inability to include and differentiate capital assets acquired with Federal awards in the capital asset inventory records could lead to improper procedures for disposal of those capital assets. Questioned Costs: None reported. Context: The District rarely uses Federal grant funds for the purchase of equipment. As a result of this, when the District’s Purchasing Agent was compiling the listing of equipment purchased during the year, to be provided to the District’s third-party capital asset management company, the equipment purchased using Federal grant funds was inadvertently omitted from the listing. Recommendation: The District should implement procedures where there is a formal reconciliation performed annually for all of the District’s equipment expenditure codes and the additions to the District’s capital assets inventory. This will ensure that all equipment purchased with Federal funds is captured and included in the capital asset inventory records. Additionally, all capital asset additions purchased with Federal funds should be managed in accordance with 2 CFR §200.313. Views of Responsible Officials of Auditee: Management agrees with the finding and will ensure that the equipment purchased with Federal funds is identified and included in the District’s capital assets inventory records as part of the capital asset reconciliation process.
2023-002. Equipment and Real Property Management Education Stabilization Fund (ESF) COVID-19: Elementary and Secondary School Emergency Relief Fund ALN: 84.425D COVID-19: American Rescue Plan – Elementary and Secondary School Emergency Relief ALN: 84.425U COVID-19: American Rescue Plan – Elementary and Secondary School Emergency Relief – Homeless Children and Youth ALN: 84.425W Criteria: 2 CFR §200.313 of the Uniform Guidance issued by the U.S. Office of Management and Budget requires management to have procedures for managing equipment (including replacement equipment), whether acquired in whole or in part under a Federal award, until disposition takes place. This includes maintaining property records that include a description of the property, a serial number or other identification number, the source of funding for the property, including the Federal Award Identification Number (FAIN), and who holds title. In addition, it requires the District to track the acquisition date and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. Condition: The District did not include equipment purchased with Federal grant funds in its current year additions in the District’s capital assets inventory records. Cause: The District uses specific codes to identify and track equipment purchased during the year. Since the District did not have adequate procedures in place to review and reconcile the District’s equipment purchases codes to the annual capital asset additions, the equipment purchased under the Federal grants was inadvertently omitted from the current year capital assets inventory additions. Effect: The inability to include and differentiate capital assets acquired with Federal awards in the capital asset inventory records could lead to improper procedures for disposal of those capital assets. Questioned Costs: None reported. Context: The District rarely uses Federal grant funds for the purchase of equipment. As a result of this, when the District’s Purchasing Agent was compiling the listing of equipment purchased during the year, to be provided to the District’s third-party capital asset management company, the equipment purchased using Federal grant funds was inadvertently omitted from the listing. Recommendation: The District should implement procedures where there is a formal reconciliation performed annually for all of the District’s equipment expenditure codes and the additions to the District’s capital assets inventory. This will ensure that all equipment purchased with Federal funds is captured and included in the capital asset inventory records. Additionally, all capital asset additions purchased with Federal funds should be managed in accordance with 2 CFR §200.313. Views of Responsible Officials of Auditee: Management agrees with the finding and will ensure that the equipment purchased with Federal funds is identified and included in the District’s capital assets inventory records as part of the capital asset reconciliation process.
2023-002. Equipment and Real Property Management Education Stabilization Fund (ESF) COVID-19: Elementary and Secondary School Emergency Relief Fund ALN: 84.425D COVID-19: American Rescue Plan – Elementary and Secondary School Emergency Relief ALN: 84.425U COVID-19: American Rescue Plan – Elementary and Secondary School Emergency Relief – Homeless Children and Youth ALN: 84.425W Criteria: 2 CFR §200.313 of the Uniform Guidance issued by the U.S. Office of Management and Budget requires management to have procedures for managing equipment (including replacement equipment), whether acquired in whole or in part under a Federal award, until disposition takes place. This includes maintaining property records that include a description of the property, a serial number or other identification number, the source of funding for the property, including the Federal Award Identification Number (FAIN), and who holds title. In addition, it requires the District to track the acquisition date and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. Condition: The District did not include equipment purchased with Federal grant funds in its current year additions in the District’s capital assets inventory records. Cause: The District uses specific codes to identify and track equipment purchased during the year. Since the District did not have adequate procedures in place to review and reconcile the District’s equipment purchases codes to the annual capital asset additions, the equipment purchased under the Federal grants was inadvertently omitted from the current year capital assets inventory additions. Effect: The inability to include and differentiate capital assets acquired with Federal awards in the capital asset inventory records could lead to improper procedures for disposal of those capital assets. Questioned Costs: None reported. Context: The District rarely uses Federal grant funds for the purchase of equipment. As a result of this, when the District’s Purchasing Agent was compiling the listing of equipment purchased during the year, to be provided to the District’s third-party capital asset management company, the equipment purchased using Federal grant funds was inadvertently omitted from the listing. Recommendation: The District should implement procedures where there is a formal reconciliation performed annually for all of the District’s equipment expenditure codes and the additions to the District’s capital assets inventory. This will ensure that all equipment purchased with Federal funds is captured and included in the capital asset inventory records. Additionally, all capital asset additions purchased with Federal funds should be managed in accordance with 2 CFR §200.313. Views of Responsible Officials of Auditee: Management agrees with the finding and will ensure that the equipment purchased with Federal funds is identified and included in the District’s capital assets inventory records as part of the capital asset reconciliation process.
2023-002. Equipment and Real Property Management Education Stabilization Fund (ESF) COVID-19: Elementary and Secondary School Emergency Relief Fund ALN: 84.425D COVID-19: American Rescue Plan – Elementary and Secondary School Emergency Relief ALN: 84.425U COVID-19: American Rescue Plan – Elementary and Secondary School Emergency Relief – Homeless Children and Youth ALN: 84.425W Criteria: 2 CFR §200.313 of the Uniform Guidance issued by the U.S. Office of Management and Budget requires management to have procedures for managing equipment (including replacement equipment), whether acquired in whole or in part under a Federal award, until disposition takes place. This includes maintaining property records that include a description of the property, a serial number or other identification number, the source of funding for the property, including the Federal Award Identification Number (FAIN), and who holds title. In addition, it requires the District to track the acquisition date and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. Condition: The District did not include equipment purchased with Federal grant funds in its current year additions in the District’s capital assets inventory records. Cause: The District uses specific codes to identify and track equipment purchased during the year. Since the District did not have adequate procedures in place to review and reconcile the District’s equipment purchases codes to the annual capital asset additions, the equipment purchased under the Federal grants was inadvertently omitted from the current year capital assets inventory additions. Effect: The inability to include and differentiate capital assets acquired with Federal awards in the capital asset inventory records could lead to improper procedures for disposal of those capital assets. Questioned Costs: None reported. Context: The District rarely uses Federal grant funds for the purchase of equipment. As a result of this, when the District’s Purchasing Agent was compiling the listing of equipment purchased during the year, to be provided to the District’s third-party capital asset management company, the equipment purchased using Federal grant funds was inadvertently omitted from the listing. Recommendation: The District should implement procedures where there is a formal reconciliation performed annually for all of the District’s equipment expenditure codes and the additions to the District’s capital assets inventory. This will ensure that all equipment purchased with Federal funds is captured and included in the capital asset inventory records. Additionally, all capital asset additions purchased with Federal funds should be managed in accordance with 2 CFR §200.313. Views of Responsible Officials of Auditee: Management agrees with the finding and will ensure that the equipment purchased with Federal funds is identified and included in the District’s capital assets inventory records as part of the capital asset reconciliation process.
Identification of the Federal Program Assistance Listing (AL) 84.425 Education Stabilization Funds (ESF) / Elementary and Secondary School Emergency Relief Fund. Criteria Requirements per section 2 CFR Section 200.313(d)(2) of the Uniform Guidance state that a physical inventory of any property purchased with Federal Funds must be taken and the results reconciled with the property records at least every two years. Statement of condition During our audit we noted the Charter School did not adhere to the terms of their financial policies and procedures manual and federal statutes, regulations, and terms and conditions of the awards received as they did not perform an inventory count at least every two years for assets purchased with Federal funds. Cause Management’s internal control procedures did not identify the need for a property inventory count on a bi -annual basis. The procedure was included in the Charter School’s internal financial policies and procedures manual as required but the actual count did not occur. Effect or Potential Effect Without a regular inventory count, property and equipment could be lost or stolen and would not be identified in a timely manner. Questioned Costs N/A Recommendation We recommend the Charter School adheres to the terms of their financial policies and procedures manual to perform inventory audits over assets purchased with Federal funds. Views of Responsible Officials Management concurs with the finding and we will update our internal controls and perform a physical count of all capital assets to ensure assets purchased with Federal funds are properly inventoried. Auditor’s Evaluation of the Views of Responsible Officials Management’s response is appropriate to address the finding. If properly implemented, management’s response would include procedures to prevent reoccurrence in the future.
Identification of the Federal Program Assistance Listing (AL) 84.425 Education Stabilization Funds (ESF) / Elementary and Secondary School Emergency Relief Fund. Criteria Requirements per section 2 CFR Section 200.313(d)(2) of the Uniform Guidance state that a physical inventory of any property purchased with Federal Funds must be taken and the results reconciled with the property records at least every two years. Statement of condition During our audit we noted the Charter School did not adhere to the terms of their financial policies and procedures manual and federal statutes, regulations, and terms and conditions of the awards received as they did not perform an inventory count at least every two years for assets purchased with Federal funds. Cause Management’s internal control procedures did not identify the need for a property inventory count on a bi -annual basis. The procedure was included in the Charter School’s internal financial policies and procedures manual as required but the actual count did not occur. Effect or Potential Effect Without a regular inventory count, property and equipment could be lost or stolen and would not be identified in a timely manner. Questioned Costs N/A Recommendation We recommend the Charter School adheres to the terms of their financial policies and procedures manual to perform inventory audits over assets purchased with Federal funds. Views of Responsible Officials Management concurs with the finding and we will update our internal controls and perform a physical count of all capital assets to ensure assets purchased with Federal funds are properly inventoried. Auditor’s Evaluation of the Views of Responsible Officials Management’s response is appropriate to address the finding. If properly implemented, management’s response would include procedures to prevent reoccurrence in the future.
FINDING 2023-003 Subject: COVID-19 Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, to ensure that the equipment and real property records contained all the required information. A property record or capital asset listing which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number (FAIN)), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. INDIANA STATE BOARD OF ACCOUNTS 18 PIKE COUNTY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The School Corporation maintained and presented the equipment and real property records for the COVID-19 - Education Stabilization Fund grant equipment; however, the records failed to include a serial number or other identification number, the source of funding for the property (including the federal award identification number), percentage of federal participation in the project costs for the federal award under which the property was acquired, the use, and condition of the property. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.313(d) states in part: "Management requirements. Procedures for managing equipment (including replacement equipment), whether acquired in whole or in part under a Federal award, until disposition takes place will, as a minimum, meet the following requirements: (1) Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. (2) A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. (3) A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated. (4) Adequate maintenance procedures must be developed to keep property in good condition. . . ." 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. INDIANA STATE BOARD OF ACCOUNTS 19 PIKE COUNTY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 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 capital asset listing did not include all the required information. 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 asset records include all the necessary information. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-003 Subject: COVID-19 Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, to ensure that the equipment and real property records contained all the required information. A property record or capital asset listing which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number (FAIN)), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. INDIANA STATE BOARD OF ACCOUNTS 18 PIKE COUNTY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The School Corporation maintained and presented the equipment and real property records for the COVID-19 - Education Stabilization Fund grant equipment; however, the records failed to include a serial number or other identification number, the source of funding for the property (including the federal award identification number), percentage of federal participation in the project costs for the federal award under which the property was acquired, the use, and condition of the property. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.313(d) states in part: "Management requirements. Procedures for managing equipment (including replacement equipment), whether acquired in whole or in part under a Federal award, until disposition takes place will, as a minimum, meet the following requirements: (1) Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. (2) A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. (3) A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated. (4) Adequate maintenance procedures must be developed to keep property in good condition. . . ." 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. INDIANA STATE BOARD OF ACCOUNTS 19 PIKE COUNTY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 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 capital asset listing did not include all the required information. 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 asset records include all the necessary information. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-003 Subject: COVID-19 Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, to ensure that the equipment and real property records contained all the required information. A property record or capital asset listing which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number (FAIN)), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. INDIANA STATE BOARD OF ACCOUNTS 18 PIKE COUNTY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The School Corporation maintained and presented the equipment and real property records for the COVID-19 - Education Stabilization Fund grant equipment; however, the records failed to include a serial number or other identification number, the source of funding for the property (including the federal award identification number), percentage of federal participation in the project costs for the federal award under which the property was acquired, the use, and condition of the property. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.313(d) states in part: "Management requirements. Procedures for managing equipment (including replacement equipment), whether acquired in whole or in part under a Federal award, until disposition takes place will, as a minimum, meet the following requirements: (1) Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. (2) A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. (3) A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated. (4) Adequate maintenance procedures must be developed to keep property in good condition. . . ." 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. INDIANA STATE BOARD OF ACCOUNTS 19 PIKE COUNTY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 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 capital asset listing did not include all the required information. 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 asset records include all the necessary information. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-003 Subject: COVID-19 Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, to ensure that the equipment and real property records contained all the required information. A property record or capital asset listing which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number (FAIN)), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. INDIANA STATE BOARD OF ACCOUNTS 18 PIKE COUNTY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The School Corporation maintained and presented the equipment and real property records for the COVID-19 - Education Stabilization Fund grant equipment; however, the records failed to include a serial number or other identification number, the source of funding for the property (including the federal award identification number), percentage of federal participation in the project costs for the federal award under which the property was acquired, the use, and condition of the property. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.313(d) states in part: "Management requirements. Procedures for managing equipment (including replacement equipment), whether acquired in whole or in part under a Federal award, until disposition takes place will, as a minimum, meet the following requirements: (1) Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. (2) A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. (3) A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated. (4) Adequate maintenance procedures must be developed to keep property in good condition. . . ." 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. INDIANA STATE BOARD OF ACCOUNTS 19 PIKE COUNTY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 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 capital asset listing did not include all the required information. 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 asset records include all the necessary information. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-003 Subject: COVID-19 Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, to ensure that the equipment and real property records contained all the required information. A property record or capital asset listing which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number (FAIN)), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. INDIANA STATE BOARD OF ACCOUNTS 18 PIKE COUNTY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The School Corporation maintained and presented the equipment and real property records for the COVID-19 - Education Stabilization Fund grant equipment; however, the records failed to include a serial number or other identification number, the source of funding for the property (including the federal award identification number), percentage of federal participation in the project costs for the federal award under which the property was acquired, the use, and condition of the property. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.313(d) states in part: "Management requirements. Procedures for managing equipment (including replacement equipment), whether acquired in whole or in part under a Federal award, until disposition takes place will, as a minimum, meet the following requirements: (1) Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. (2) A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. (3) A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated. (4) Adequate maintenance procedures must be developed to keep property in good condition. . . ." 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. INDIANA STATE BOARD OF ACCOUNTS 19 PIKE COUNTY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 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 capital asset listing did not include all the required information. 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 asset records include all the necessary information. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-003 Subject: COVID-19 Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, to ensure that the equipment and real property records contained all the required information. A property record or capital asset listing which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number (FAIN)), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. INDIANA STATE BOARD OF ACCOUNTS 18 PIKE COUNTY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The School Corporation maintained and presented the equipment and real property records for the COVID-19 - Education Stabilization Fund grant equipment; however, the records failed to include a serial number or other identification number, the source of funding for the property (including the federal award identification number), percentage of federal participation in the project costs for the federal award under which the property was acquired, the use, and condition of the property. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.313(d) states in part: "Management requirements. Procedures for managing equipment (including replacement equipment), whether acquired in whole or in part under a Federal award, until disposition takes place will, as a minimum, meet the following requirements: (1) Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. (2) A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. (3) A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated. (4) Adequate maintenance procedures must be developed to keep property in good condition. . . ." 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. INDIANA STATE BOARD OF ACCOUNTS 19 PIKE COUNTY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 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 capital asset listing did not include all the required information. 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 asset records include all the necessary information. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
FINDING #2023-004: EDUCATION STABILIZATION FUNDS (ESF) – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund (Resource 3213) Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted used funds did not appear to be pre-approved by the California Department of Education (CDE). The District used ESF Funds to pay for a portion of their financed purchase agreement for solar. The District did not receive pre-approval to utilize the funds in this way. In addition, multi-year payment contracts must all occur within the grant period, of which requires funds to be obligated by September 30, 2024. The payment schedule for the financed purchase agreement exceeds the grant period. Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $240,801. This is the total of the solar financed purchase agreement payments charged to Resource 3213 during the 2022-23 year. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000 for capital projects. Views of Responsible Officials: See Corrective Action Plan on following page.
Finding 2023-002 – Inaccurate Property Management Records Federal Agency: U.S. Department of Agriculture (USDA) U.S. Department of Commerce (USDOC) U.S. Department of Defense (USDOD) U.S. Department of Education (USDE) U.S. Department of Energy (USDOE) U.S. Department of Health and Human Services (USDHHS) U.S. Department of Housing and Urban Development (USHUD) U.S. Department of Interior (USDOI) U.S. Department of Justice (USDOJ) U.S. Department of State (USDOS) U.S. Department of Transportation (USDOT) U.S. Director of National Intelligence (USDNI) U.S. Environmental Protection Agency (USEPA) National Aeronautics and Space Administration (NASA) National Endowment for the Humanities (NEH) National Science Foundation (NSF) U.S. Department of Veteran Affairs (USDVA) All Pass-Through Entities Program Name: Research and Development Cluster ALN # and Program Expenditures: Various ($508,850,558) Federal Award Numbers: Various – See schedule of award numbers Federal Award Year: Various – See schedule of award numbers Questioned Costs: None Compliance Requirement: Equipment Type of Finding: Noncompliance and material weakness Condition Found The University did not consistently follow its property management policies and procedures related to maintaining accurate property management records for equipment purchased with federal R&D Cluster program awards. The University conducts research at multiple locations throughout its campus where equipment purchased with federal awards is utilized and maintained. The University identifies all equipment in its property management records with individually assigned asset numbers and each individual asset record includes the specific location of the asset, the federal award general ledger account number which funded the purchase of the asset, and other required information. An asset tag with the assigned asset number is affixed to each asset in accordance with University policy. The University is required to safeguard equipment purchased with federal awards, maintain current property records, and to perform a physical inventory of equipment purchased with federal awards on a biennial basis. During our physical observation of 60 pieces of equipment (with a net book value (NBV) of $224,269) purchased with federal R&D Cluster awards, we noted eight items (with a NBV totaling $0) selected for physical observation were not able to be located for our testing. In response to the exceptions identified in our audit procedures, the University performed a physical inventory of all of its federally funded equipment in January 2024, which identified an additional 1,006 equipment items (with a NBV of $1,726,897) that could not be located, of which 839 were fully depreciated. University management believes these items were disposed of but not appropriately removed from the property records and federal equipment listing. As of June 30, 2023, the University’s federal equipment listing included 6,270 assets (with a NBV of $61,390,724) purchased with R&D Cluster program awards. We also noted the University’s controls for equipment dispositions are not operating at an appropriate level of precision to ensure equipment dispositions are properly authorized and property management records are updated on a timely basis. Criteria According to 2 CFR 200.313(d)(1), property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property, who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. Per 2 CFR 200.313(d)(3) and (4), a control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of property and adequate maintenance procedures must be developed to keep the property in good condition. In addition, 2 CFR 200.303 requires nonfederal entities to, among other things, 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. Effective internal controls should include procedures to ensure that accurate property records are maintained and equipment items are properly tagged. Cause In discussing these conditions with University officials, they stated the decentralized nature of the equipment recordkeeping process can result in delayed reporting of asset disposals. Possible Asserted Effect Failure to maintain accurate property records may prohibit the University from properly safeguarding and maintaining equipment and may result in federal programs not receiving the appropriate share of proceeds from the disposals of equipment purchased with federal funds. Repeat Finding A similar finding was reported in the prior year audit as finding number 2022-002. Statistical Sampling The sample was not intended to be, and was not, a statistically valid sample. Recommendation We recommend the University review its procedures for updating property records to ensure they accurately reflect equipment information. Views of University Officials The University concurs with the finding and has begun to address these concerns. As noted in the finding, the University conducted a full federal equipment inventory in January 2024 and updated property records to ensure accuracy of federally funded equipment.
Finding 2023-002 – Inaccurate Property Management Records Federal Agency: U.S. Department of Agriculture (USDA) U.S. Department of Commerce (USDOC) U.S. Department of Defense (USDOD) U.S. Department of Education (USDE) U.S. Department of Energy (USDOE) U.S. Department of Health and Human Services (USDHHS) U.S. Department of Housing and Urban Development (USHUD) U.S. Department of Interior (USDOI) U.S. Department of Justice (USDOJ) U.S. Department of State (USDOS) U.S. Department of Transportation (USDOT) U.S. Director of National Intelligence (USDNI) U.S. Environmental Protection Agency (USEPA) National Aeronautics and Space Administration (NASA) National Endowment for the Humanities (NEH) National Science Foundation (NSF) U.S. Department of Veteran Affairs (USDVA) All Pass-Through Entities Program Name: Research and Development Cluster ALN # and Program Expenditures: Various ($508,850,558) Federal Award Numbers: Various – See schedule of award numbers Federal Award Year: Various – See schedule of award numbers Questioned Costs: None Compliance Requirement: Equipment Type of Finding: Noncompliance and material weakness Condition Found The University did not consistently follow its property management policies and procedures related to maintaining accurate property management records for equipment purchased with federal R&D Cluster program awards. The University conducts research at multiple locations throughout its campus where equipment purchased with federal awards is utilized and maintained. The University identifies all equipment in its property management records with individually assigned asset numbers and each individual asset record includes the specific location of the asset, the federal award general ledger account number which funded the purchase of the asset, and other required information. An asset tag with the assigned asset number is affixed to each asset in accordance with University policy. The University is required to safeguard equipment purchased with federal awards, maintain current property records, and to perform a physical inventory of equipment purchased with federal awards on a biennial basis. During our physical observation of 60 pieces of equipment (with a net book value (NBV) of $224,269) purchased with federal R&D Cluster awards, we noted eight items (with a NBV totaling $0) selected for physical observation were not able to be located for our testing. In response to the exceptions identified in our audit procedures, the University performed a physical inventory of all of its federally funded equipment in January 2024, which identified an additional 1,006 equipment items (with a NBV of $1,726,897) that could not be located, of which 839 were fully depreciated. University management believes these items were disposed of but not appropriately removed from the property records and federal equipment listing. As of June 30, 2023, the University’s federal equipment listing included 6,270 assets (with a NBV of $61,390,724) purchased with R&D Cluster program awards. We also noted the University’s controls for equipment dispositions are not operating at an appropriate level of precision to ensure equipment dispositions are properly authorized and property management records are updated on a timely basis. Criteria According to 2 CFR 200.313(d)(1), property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property, who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. Per 2 CFR 200.313(d)(3) and (4), a control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of property and adequate maintenance procedures must be developed to keep the property in good condition. In addition, 2 CFR 200.303 requires nonfederal entities to, among other things, 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. Effective internal controls should include procedures to ensure that accurate property records are maintained and equipment items are properly tagged. Cause In discussing these conditions with University officials, they stated the decentralized nature of the equipment recordkeeping process can result in delayed reporting of asset disposals. Possible Asserted Effect Failure to maintain accurate property records may prohibit the University from properly safeguarding and maintaining equipment and may result in federal programs not receiving the appropriate share of proceeds from the disposals of equipment purchased with federal funds. Repeat Finding A similar finding was reported in the prior year audit as finding number 2022-002. Statistical Sampling The sample was not intended to be, and was not, a statistically valid sample. Recommendation We recommend the University review its procedures for updating property records to ensure they accurately reflect equipment information. Views of University Officials The University concurs with the finding and has begun to address these concerns. As noted in the finding, the University conducted a full federal equipment inventory in January 2024 and updated property records to ensure accuracy of federally funded equipment.
Finding 2023-002 – Inaccurate Property Management Records Federal Agency: U.S. Department of Agriculture (USDA) U.S. Department of Commerce (USDOC) U.S. Department of Defense (USDOD) U.S. Department of Education (USDE) U.S. Department of Energy (USDOE) U.S. Department of Health and Human Services (USDHHS) U.S. Department of Housing and Urban Development (USHUD) U.S. Department of Interior (USDOI) U.S. Department of Justice (USDOJ) U.S. Department of State (USDOS) U.S. Department of Transportation (USDOT) U.S. Director of National Intelligence (USDNI) U.S. Environmental Protection Agency (USEPA) National Aeronautics and Space Administration (NASA) National Endowment for the Humanities (NEH) National Science Foundation (NSF) U.S. Department of Veteran Affairs (USDVA) All Pass-Through Entities Program Name: Research and Development Cluster ALN # and Program Expenditures: Various ($508,850,558) Federal Award Numbers: Various – See schedule of award numbers Federal Award Year: Various – See schedule of award numbers Questioned Costs: None Compliance Requirement: Equipment Type of Finding: Noncompliance and material weakness Condition Found The University did not consistently follow its property management policies and procedures related to maintaining accurate property management records for equipment purchased with federal R&D Cluster program awards. The University conducts research at multiple locations throughout its campus where equipment purchased with federal awards is utilized and maintained. The University identifies all equipment in its property management records with individually assigned asset numbers and each individual asset record includes the specific location of the asset, the federal award general ledger account number which funded the purchase of the asset, and other required information. An asset tag with the assigned asset number is affixed to each asset in accordance with University policy. The University is required to safeguard equipment purchased with federal awards, maintain current property records, and to perform a physical inventory of equipment purchased with federal awards on a biennial basis. During our physical observation of 60 pieces of equipment (with a net book value (NBV) of $224,269) purchased with federal R&D Cluster awards, we noted eight items (with a NBV totaling $0) selected for physical observation were not able to be located for our testing. In response to the exceptions identified in our audit procedures, the University performed a physical inventory of all of its federally funded equipment in January 2024, which identified an additional 1,006 equipment items (with a NBV of $1,726,897) that could not be located, of which 839 were fully depreciated. University management believes these items were disposed of but not appropriately removed from the property records and federal equipment listing. As of June 30, 2023, the University’s federal equipment listing included 6,270 assets (with a NBV of $61,390,724) purchased with R&D Cluster program awards. We also noted the University’s controls for equipment dispositions are not operating at an appropriate level of precision to ensure equipment dispositions are properly authorized and property management records are updated on a timely basis. Criteria According to 2 CFR 200.313(d)(1), property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property, who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. Per 2 CFR 200.313(d)(3) and (4), a control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of property and adequate maintenance procedures must be developed to keep the property in good condition. In addition, 2 CFR 200.303 requires nonfederal entities to, among other things, 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. Effective internal controls should include procedures to ensure that accurate property records are maintained and equipment items are properly tagged. Cause In discussing these conditions with University officials, they stated the decentralized nature of the equipment recordkeeping process can result in delayed reporting of asset disposals. Possible Asserted Effect Failure to maintain accurate property records may prohibit the University from properly safeguarding and maintaining equipment and may result in federal programs not receiving the appropriate share of proceeds from the disposals of equipment purchased with federal funds. Repeat Finding A similar finding was reported in the prior year audit as finding number 2022-002. Statistical Sampling The sample was not intended to be, and was not, a statistically valid sample. Recommendation We recommend the University review its procedures for updating property records to ensure they accurately reflect equipment information. Views of University Officials The University concurs with the finding and has begun to address these concerns. As noted in the finding, the University conducted a full federal equipment inventory in January 2024 and updated property records to ensure accuracy of federally funded equipment.
Finding 2023-002 – Inaccurate Property Management Records Federal Agency: U.S. Department of Agriculture (USDA) U.S. Department of Commerce (USDOC) U.S. Department of Defense (USDOD) U.S. Department of Education (USDE) U.S. Department of Energy (USDOE) U.S. Department of Health and Human Services (USDHHS) U.S. Department of Housing and Urban Development (USHUD) U.S. Department of Interior (USDOI) U.S. Department of Justice (USDOJ) U.S. Department of State (USDOS) U.S. Department of Transportation (USDOT) U.S. Director of National Intelligence (USDNI) U.S. Environmental Protection Agency (USEPA) National Aeronautics and Space Administration (NASA) National Endowment for the Humanities (NEH) National Science Foundation (NSF) U.S. Department of Veteran Affairs (USDVA) All Pass-Through Entities Program Name: Research and Development Cluster ALN # and Program Expenditures: Various ($508,850,558) Federal Award Numbers: Various – See schedule of award numbers Federal Award Year: Various – See schedule of award numbers Questioned Costs: None Compliance Requirement: Equipment Type of Finding: Noncompliance and material weakness Condition Found The University did not consistently follow its property management policies and procedures related to maintaining accurate property management records for equipment purchased with federal R&D Cluster program awards. The University conducts research at multiple locations throughout its campus where equipment purchased with federal awards is utilized and maintained. The University identifies all equipment in its property management records with individually assigned asset numbers and each individual asset record includes the specific location of the asset, the federal award general ledger account number which funded the purchase of the asset, and other required information. An asset tag with the assigned asset number is affixed to each asset in accordance with University policy. The University is required to safeguard equipment purchased with federal awards, maintain current property records, and to perform a physical inventory of equipment purchased with federal awards on a biennial basis. During our physical observation of 60 pieces of equipment (with a net book value (NBV) of $224,269) purchased with federal R&D Cluster awards, we noted eight items (with a NBV totaling $0) selected for physical observation were not able to be located for our testing. In response to the exceptions identified in our audit procedures, the University performed a physical inventory of all of its federally funded equipment in January 2024, which identified an additional 1,006 equipment items (with a NBV of $1,726,897) that could not be located, of which 839 were fully depreciated. University management believes these items were disposed of but not appropriately removed from the property records and federal equipment listing. As of June 30, 2023, the University’s federal equipment listing included 6,270 assets (with a NBV of $61,390,724) purchased with R&D Cluster program awards. We also noted the University’s controls for equipment dispositions are not operating at an appropriate level of precision to ensure equipment dispositions are properly authorized and property management records are updated on a timely basis. Criteria According to 2 CFR 200.313(d)(1), property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property, who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. Per 2 CFR 200.313(d)(3) and (4), a control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of property and adequate maintenance procedures must be developed to keep the property in good condition. In addition, 2 CFR 200.303 requires nonfederal entities to, among other things, 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. Effective internal controls should include procedures to ensure that accurate property records are maintained and equipment items are properly tagged. Cause In discussing these conditions with University officials, they stated the decentralized nature of the equipment recordkeeping process can result in delayed reporting of asset disposals. Possible Asserted Effect Failure to maintain accurate property records may prohibit the University from properly safeguarding and maintaining equipment and may result in federal programs not receiving the appropriate share of proceeds from the disposals of equipment purchased with federal funds. Repeat Finding A similar finding was reported in the prior year audit as finding number 2022-002. Statistical Sampling The sample was not intended to be, and was not, a statistically valid sample. Recommendation We recommend the University review its procedures for updating property records to ensure they accurately reflect equipment information. Views of University Officials The University concurs with the finding and has begun to address these concerns. As noted in the finding, the University conducted a full federal equipment inventory in January 2024 and updated property records to ensure accuracy of federally funded equipment.
Finding 2023-002 – Inaccurate Property Management Records Federal Agency: U.S. Department of Agriculture (USDA) U.S. Department of Commerce (USDOC) U.S. Department of Defense (USDOD) U.S. Department of Education (USDE) U.S. Department of Energy (USDOE) U.S. Department of Health and Human Services (USDHHS) U.S. Department of Housing and Urban Development (USHUD) U.S. Department of Interior (USDOI) U.S. Department of Justice (USDOJ) U.S. Department of State (USDOS) U.S. Department of Transportation (USDOT) U.S. Director of National Intelligence (USDNI) U.S. Environmental Protection Agency (USEPA) National Aeronautics and Space Administration (NASA) National Endowment for the Humanities (NEH) National Science Foundation (NSF) U.S. Department of Veteran Affairs (USDVA) All Pass-Through Entities Program Name: Research and Development Cluster ALN # and Program Expenditures: Various ($508,850,558) Federal Award Numbers: Various – See schedule of award numbers Federal Award Year: Various – See schedule of award numbers Questioned Costs: None Compliance Requirement: Equipment Type of Finding: Noncompliance and material weakness Condition Found The University did not consistently follow its property management policies and procedures related to maintaining accurate property management records for equipment purchased with federal R&D Cluster program awards. The University conducts research at multiple locations throughout its campus where equipment purchased with federal awards is utilized and maintained. The University identifies all equipment in its property management records with individually assigned asset numbers and each individual asset record includes the specific location of the asset, the federal award general ledger account number which funded the purchase of the asset, and other required information. An asset tag with the assigned asset number is affixed to each asset in accordance with University policy. The University is required to safeguard equipment purchased with federal awards, maintain current property records, and to perform a physical inventory of equipment purchased with federal awards on a biennial basis. During our physical observation of 60 pieces of equipment (with a net book value (NBV) of $224,269) purchased with federal R&D Cluster awards, we noted eight items (with a NBV totaling $0) selected for physical observation were not able to be located for our testing. In response to the exceptions identified in our audit procedures, the University performed a physical inventory of all of its federally funded equipment in January 2024, which identified an additional 1,006 equipment items (with a NBV of $1,726,897) that could not be located, of which 839 were fully depreciated. University management believes these items were disposed of but not appropriately removed from the property records and federal equipment listing. As of June 30, 2023, the University’s federal equipment listing included 6,270 assets (with a NBV of $61,390,724) purchased with R&D Cluster program awards. We also noted the University’s controls for equipment dispositions are not operating at an appropriate level of precision to ensure equipment dispositions are properly authorized and property management records are updated on a timely basis. Criteria According to 2 CFR 200.313(d)(1), property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property, who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. Per 2 CFR 200.313(d)(3) and (4), a control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of property and adequate maintenance procedures must be developed to keep the property in good condition. In addition, 2 CFR 200.303 requires nonfederal entities to, among other things, 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. Effective internal controls should include procedures to ensure that accurate property records are maintained and equipment items are properly tagged. Cause In discussing these conditions with University officials, they stated the decentralized nature of the equipment recordkeeping process can result in delayed reporting of asset disposals. Possible Asserted Effect Failure to maintain accurate property records may prohibit the University from properly safeguarding and maintaining equipment and may result in federal programs not receiving the appropriate share of proceeds from the disposals of equipment purchased with federal funds. Repeat Finding A similar finding was reported in the prior year audit as finding number 2022-002. Statistical Sampling The sample was not intended to be, and was not, a statistically valid sample. Recommendation We recommend the University review its procedures for updating property records to ensure they accurately reflect equipment information. Views of University Officials The University concurs with the finding and has begun to address these concerns. As noted in the finding, the University conducted a full federal equipment inventory in January 2024 and updated property records to ensure accuracy of federally funded equipment.