Finding 2022 003 Federal Program Title ? Research & Development Cluster Assistance Listing No. ? As listed on the Schedule of Expenditures of Federal Awards Federal Agencies ? U.S. Department of Agriculture, U.S. Department of Commerce, U.S. Department of Defense, U.S. Department of Interior, U.S. Department of Justice, Department of State, U.S. Department of Transportation, National Aeronautics and Space Administration, National Endowment for the Humanities, National Science Foundation, U.S. Department of Veterans Affairs, U.S. Department of Energy, U.S. Department of Education, and U.S. Department of Health and Human Services Federal Award Numbers ? As listed on the Schedule of Expenditures of Federal Awards Grant Award Periods ? Various Compliance Requirement ? Equipment/Real Property Management Criteria: As set forth in 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 (including the 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, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. Additionally, 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. Conditions Found: While performing audit procedures related to the accuracy and completeness of property records and physical inspection of the existence and safeguarding of fifty-seven equipment items (with a net book value of 628,232), the following conditions were identified: ? During our physical inspection procedures, which took several attempts, we noted thirty-five equipment items sampled (with a net book value of $583,715) that were not found at the location stated within the fiscal year 2022 property records maintained by the University for the following items: See Schedule of Findings and Questioned Costs for chart/table The property records for ten equipment items sampled (with a net book value of $327,266) did not have accurate property records (note some of these same equipment items were also not found at the location stated and were also included in the table above). Specifically, the serial number on the equipment item sampled was not documented in the fiscal year 2022 property records maintained by the University for the following items: See Schedule of Findings and Questioned Costs for chart/table ? The property records for two equipment items (with $0 net book value) sampled were not updated to reflect disposals made during fiscal year 2022. Management stated no proceeds were received for the following items: See Schedule of Findings and Questioned Costs for chart/table The University did not have an effective system of internal control in place to ensure property records accurately reflect equipment locations, equipment serial numbers, and disposals. As of June 30, 2022, the University was responsible for maintaining and safeguarding equipment purchased using federal awards with a net book value of $2,110,646. Questioned Cost: There are no questioned costs. Cause and Effect: In discussing these conditions with University management, they stated that inadequate documentation of policies and procedures regarding the types of conditions that require communication to the Business and Finance office (e.g., when equipment is moved to a different location), as well as a lack of a review of changes made to property records by someone other than the preparer, contributed to multiple errors in the property records. Repeat Finding: A similar finding was reported in prior year audit as finding number 2021 003. Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Recommendations: We recommend the University strengthen policies, procedures and internal controls to ensure requirements around equipment/real property management are met. We recommend the University perform a detailed review of the property records and make corrections to accurately reflect the required information. We also recommend the University take a fresh look at their capital equipment recordkeeping policies and procedures and consider both preventive and detective internal controls to ensure property records accurately reflect the requirements of 2 CFR 200.313(d)(1).
Federal Agency: U.S. Department of Education Passthrough Entity: Missouri Department of Elementary and Secondary Education Assistance Listing Number and Federal Program: 84.425U American Rescue Plan-Elementary and Secondary School Emergency Relief Compliance Requirement: F. Equipment and Real Property Management Criteria: 2 CFR section 200.313(d) states ?(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 sales 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. Additionally, the District did not comply with 29 CFR section 5.5 (Davis-Bacon Act) which states Federally funded construction projects exceeding $2,000 must include prevailing wage rate clauses and ensure that contractors and subcontractors pay workers the prevailing wage rates established by the Department of Labor. Statement of Condition: During our audit we found the District is not keeping records to specifically track property and equipment acquired with Federal awards, nor is an inventory performed as required. The District used Federal funds for minor remodeling projects and it was found that the District did not ensure the contractors were paying workers correct prevailing wage rates. Statement of Cause: The absence of internal controls over equipment and real property management led to the noncompliance with Federal regulations. Statement of Effect: Equipment purchases with Federal funds may be misallocated or disposed of improperly. A misunderstanding of Davis-Bacon Act requirements increases the risk that contractors and subcontractors paid with Federal funds will not pay the appropriate prevailing wage rates to workers. Questioned Costs: No questioned costs were identified. Perspective Information: This appears to be a systemic problem as it was found no inventory has ever been kept for equipment purchased with Federal funds and therefore no physical inventory has been performed. The issue related to the Davis-Bacon Act is an isolated instance. Identification of Repeat Findings: Not a repeat finding.Recommendation: We recommend the District create an inventory listing of all equipment purchased with Federal funds. The District should create policies and procedures and ensure internal controls are in place to update the listing accurately and timely. Additionally, internal controls should be developed to safeguard the equipment and perform a physical inventory at least once every two years. The District should become familiar with the Davis-Bacon Act requirements and ensure the prevailing wage rate requirements are being followed by its contractors and subcontractors. The District should create policies and procedures to implement a review of the prevailing wage rates paid to workers.
Federal Agency: U.S. Department of Education Passthrough Entity: Missouri Department of Elementary and Secondary Education Assistance Listing Number and Federal Program: 84.425U American Rescue Plan-Elementary and Secondary School Emergency Relief Compliance Requirement: F. Equipment and Real Property Management Criteria: 2 CFR section 200.313(d) states ?(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 sales 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. Additionally, the District did not comply with 29 CFR section 5.5 (Davis-Bacon Act) which states Federally funded construction projects exceeding $2,000 must include prevailing wage rate clauses and ensure that contractors and subcontractors pay workers the prevailing wage rates established by the Department of Labor. Statement of Condition: During our audit we found the District is not keeping records to specifically track property and equipment acquired with Federal awards, nor is an inventory performed as required. The District used Federal funds for minor remodeling projects and it was found that the District did not ensure the contractors were paying workers correct prevailing wage rates. Statement of Cause: The absence of internal controls over equipment and real property management led to the noncompliance with Federal regulations. Statement of Effect: Equipment purchases with Federal funds may be misallocated or disposed of improperly. A misunderstanding of Davis-Bacon Act requirements increases the risk that contractors and subcontractors paid with Federal funds will not pay the appropriate prevailing wage rates to workers. Questioned Costs: No questioned costs were identified. Perspective Information: This appears to be a systemic problem as it was found no inventory has ever been kept for equipment purchased with Federal funds and therefore no physical inventory has been performed. The issue related to the Davis-Bacon Act is an isolated instance. Identification of Repeat Findings: Not a repeat finding.Recommendation: We recommend the District create an inventory listing of all equipment purchased with Federal funds. The District should create policies and procedures and ensure internal controls are in place to update the listing accurately and timely. Additionally, internal controls should be developed to safeguard the equipment and perform a physical inventory at least once every two years. The District should become familiar with the Davis-Bacon Act requirements and ensure the prevailing wage rate requirements are being followed by its contractors and subcontractors. The District should create policies and procedures to implement a review of the prevailing wage rates paid to workers.
Federal Agency: U.S. Department of Education Passthrough Entity: Missouri Department of Elementary and Secondary Education Assistance Listing Number and Federal Program: 84.425U American Rescue Plan-Elementary and Secondary School Emergency Relief Compliance Requirement: F. Equipment and Real Property Management Criteria: 2 CFR section 200.313(d) states ?(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 sales 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. Additionally, the District did not comply with 29 CFR section 5.5 (Davis-Bacon Act) which states Federally funded construction projects exceeding $2,000 must include prevailing wage rate clauses and ensure that contractors and subcontractors pay workers the prevailing wage rates established by the Department of Labor. Statement of Condition: During our audit we found the District is not keeping records to specifically track property and equipment acquired with Federal awards, nor is an inventory performed as required. The District used Federal funds for minor remodeling projects and it was found that the District did not ensure the contractors were paying workers correct prevailing wage rates. Statement of Cause: The absence of internal controls over equipment and real property management led to the noncompliance with Federal regulations. Statement of Effect: Equipment purchases with Federal funds may be misallocated or disposed of improperly. A misunderstanding of Davis-Bacon Act requirements increases the risk that contractors and subcontractors paid with Federal funds will not pay the appropriate prevailing wage rates to workers. Questioned Costs: No questioned costs were identified. Perspective Information: This appears to be a systemic problem as it was found no inventory has ever been kept for equipment purchased with Federal funds and therefore no physical inventory has been performed. The issue related to the Davis-Bacon Act is an isolated instance. Identification of Repeat Findings: Not a repeat finding.Recommendation: We recommend the District create an inventory listing of all equipment purchased with Federal funds. The District should create policies and procedures and ensure internal controls are in place to update the listing accurately and timely. Additionally, internal controls should be developed to safeguard the equipment and perform a physical inventory at least once every two years. The District should become familiar with the Davis-Bacon Act requirements and ensure the prevailing wage rate requirements are being followed by its contractors and subcontractors. The District should create policies and procedures to implement a review of the prevailing wage rates paid to workers.
MATERIAL WEAKNESS IN INTERNAL CONTROL OVER COMPLIANCE AND MATERIAL NONCOMPLIANCE ? U.S. DEPARTMENT OF EDUCATION ? PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, COVID-19 ? EDUCATION STABILIZATION FUND, FEDERAL ALN 84.425 2022-002 Internal Control Over Compliance and Material Noncompliance With Equipment and Real Property Management Requirements Criteria ? 2 CFR ? 200.313 (c)(1) and (d)(1) requires that Aurora Charter School (the School) obtain approval from the federal funding agency or pass-through agency prior to the purchase of equipment with federal funding. Condition ? During our audit, we noted the School did not have sufficient controls in place within the Education Stabilization Fund federal program to assure compliance with federal equipment and real property management requirements, resulting in material noncompliance. Questioned Costs ? None. Context ? The School did not obtain approval from the federal funding agency or pass through agency prior to purchasing equipment with a total value of $208,443 using federal funds. Repeat Finding ? This is a current year finding. Cause ? This condition was due to a misunderstanding of the individual item value, which federally funded equipment purchases were required to be preapproved and tracked. Effect ? Noncompliance with the equipment and real property management could be viewed as a violation of the award agreement and result in loss of funds. Recommendation ? We recommend that the School review its internal control procedures to ensure future compliance with the federal compliance requirements specific to equipment and real property management for the COVID-19 ? Education Stabilization Fund federal program. View of Responsible Official and Planned Corrective Actions ? The School agrees with the finding. The School intends to revise its internal capitalization threshold to align with the federal threshold, and to review its other control procedures relating to equipment and real property management requirements to ensure compliance for future federal awards expenditures. The School has separately issued a Corrective Action Plan related to this finding.
MATERIAL WEAKNESS IN INTERNAL CONTROL OVER COMPLIANCE AND MATERIAL NONCOMPLIANCE ? U.S. DEPARTMENT OF EDUCATION ? PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, COVID-19 ? EDUCATION STABILIZATION FUND, FEDERAL ALN 84.425 2022-002 Internal Control Over Compliance and Material Noncompliance With Equipment and Real Property Management Requirements Criteria ? 2 CFR ? 200.313 (c)(1) and (d)(1) requires that Aurora Charter School (the School) obtain approval from the federal funding agency or pass-through agency prior to the purchase of equipment with federal funding. Condition ? During our audit, we noted the School did not have sufficient controls in place within the Education Stabilization Fund federal program to assure compliance with federal equipment and real property management requirements, resulting in material noncompliance. Questioned Costs ? None. Context ? The School did not obtain approval from the federal funding agency or pass through agency prior to purchasing equipment with a total value of $208,443 using federal funds. Repeat Finding ? This is a current year finding. Cause ? This condition was due to a misunderstanding of the individual item value, which federally funded equipment purchases were required to be preapproved and tracked. Effect ? Noncompliance with the equipment and real property management could be viewed as a violation of the award agreement and result in loss of funds. Recommendation ? We recommend that the School review its internal control procedures to ensure future compliance with the federal compliance requirements specific to equipment and real property management for the COVID-19 ? Education Stabilization Fund federal program. View of Responsible Official and Planned Corrective Actions ? The School agrees with the finding. The School intends to revise its internal capitalization threshold to align with the federal threshold, and to review its other control procedures relating to equipment and real property management requirements to ensure compliance for future federal awards expenditures. The School has separately issued a Corrective Action Plan related to this finding.
MATERIAL WEAKNESS IN INTERNAL CONTROL OVER COMPLIANCE AND MATERIAL NONCOMPLIANCE ? U.S. DEPARTMENT OF EDUCATION ? PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, COVID-19 ? EDUCATION STABILIZATION FUND, FEDERAL ALN 84.425 2022-002 Internal Control Over Compliance and Material Noncompliance With Equipment and Real Property Management Requirements Criteria ? 2 CFR ? 200.313 (c)(1) and (d)(1) requires that Aurora Charter School (the School) obtain approval from the federal funding agency or pass-through agency prior to the purchase of equipment with federal funding. Condition ? During our audit, we noted the School did not have sufficient controls in place within the Education Stabilization Fund federal program to assure compliance with federal equipment and real property management requirements, resulting in material noncompliance. Questioned Costs ? None. Context ? The School did not obtain approval from the federal funding agency or pass through agency prior to purchasing equipment with a total value of $208,443 using federal funds. Repeat Finding ? This is a current year finding. Cause ? This condition was due to a misunderstanding of the individual item value, which federally funded equipment purchases were required to be preapproved and tracked. Effect ? Noncompliance with the equipment and real property management could be viewed as a violation of the award agreement and result in loss of funds. Recommendation ? We recommend that the School review its internal control procedures to ensure future compliance with the federal compliance requirements specific to equipment and real property management for the COVID-19 ? Education Stabilization Fund federal program. View of Responsible Official and Planned Corrective Actions ? The School agrees with the finding. The School intends to revise its internal capitalization threshold to align with the federal threshold, and to review its other control procedures relating to equipment and real property management requirements to ensure compliance for future federal awards expenditures. The School has separately issued a Corrective Action Plan related to this finding.
U.S. DEPARTMENT OF EDUCATION PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION COVID - 19 - EDUCATION STABILIZATION FUND - AL NUMBER 84.425D PASS-THROUGH NUMBER 4605 AUDIT PERIOD - YEAR ENDED JUNE 30, 2022" 2022-001. Equipment and Real Property Management Criteria: Proper records should be maintained for equipment acquired with federal awards as specified in 2 CFR section 200.313. Additionally, the District should ensure that disposition of such equipment is in accordance with federal requirements, including the federal awarding agency is appropriately compensated for its share of any property sold or converted to non-federal use. Condition: The District could not account for three equipment items, costing $4,079, purchased from the COVID-19 - Education Stabilization Funds. Cause: Lack of internal controls over equipment subsidiary records. Effect or potential effect: The District's equipment subsidiary records were not accurate. Context: Selected 21 items with a total initial cost of $93,791 for inspection purposes from a population of 206 equipment items with a total initial cost of $4,283,051 recorded in the equipment subsidiary records for the Education Stabilization program. Recommendation: Proper records should be maintained for equipment acquired with federal awards. Views of responsible officials: District will more closely monitor the inventories of fixed assets and equipment and supplies purchased with Federal and non-Federal funding. More indepth training will be provided to campus leadership and departmental heads on the disposal process of fixed assets and items purchased under Federal funding. The District will take every precaution necessary to ensure that fixed assets and items purchased with Federal funds will be handled appropriately throughout the life-cycle and assure that proper records are maintained for equipment in accordance with Arkansas Department of Elementary and Secondary Education, as well as Federal, guidelines and procedures for program expenditures.
U.S. DEPARTMENT OF EDUCATION PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION COVID - 19 - EDUCATION STABILIZATION FUND - AL NUMBER 84.425D PASS-THROUGH NUMBER 4605 AUDIT PERIOD - YEAR ENDED JUNE 30, 2022" 2022-001. Equipment and Real Property Management Criteria: Proper records should be maintained for equipment acquired with federal awards as specified in 2 CFR section 200.313. Additionally, the District should ensure that disposition of such equipment is in accordance with federal requirements, including the federal awarding agency is appropriately compensated for its share of any property sold or converted to non-federal use. Condition: The District could not account for three equipment items, costing $4,079, purchased from the COVID-19 - Education Stabilization Funds. Cause: Lack of internal controls over equipment subsidiary records. Effect or potential effect: The District's equipment subsidiary records were not accurate. Context: Selected 21 items with a total initial cost of $93,791 for inspection purposes from a population of 206 equipment items with a total initial cost of $4,283,051 recorded in the equipment subsidiary records for the Education Stabilization program. Recommendation: Proper records should be maintained for equipment acquired with federal awards. Views of responsible officials: District will more closely monitor the inventories of fixed assets and equipment and supplies purchased with Federal and non-Federal funding. More indepth training will be provided to campus leadership and departmental heads on the disposal process of fixed assets and items purchased under Federal funding. The District will take every precaution necessary to ensure that fixed assets and items purchased with Federal funds will be handled appropriately throughout the life-cycle and assure that proper records are maintained for equipment in accordance with Arkansas Department of Elementary and Secondary Education, as well as Federal, guidelines and procedures for program expenditures.
SECTION III - FEDERAL AWARDS FINDINGS AND QUESTIONED COSTS 2022-004 EQUIPMENT/REAL PROPERTY MANAGEMENT Program: Education Stabilization Fund CFDA Number: 84.425D Federal Agency: U.S. Department of Education Pass-Through Agency: Arizona Department of Education Grantor Number: 21FESSII-111389-01A Questioned Costs: $-0- Type of Finding: Noncompliance, significant deficiency Compliance Requirement: F. Equipment/Real Property Management Condition/Context: The District did not properly update its capital assets listing to include equipment purchased under Criteria: The District must follow 2 CFR sections 200.313 which requires 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. Cause: The District did not have proper internal controls over property and equipment to ensure the capital assets listing was properly updated. Effect: Noncompliance and internal control weakness. The District could inadvertently use an asset outside of its intended purpose and assets could go missing. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District establish proper internal controls over property and equipment to ensure all assets are properly recorded on the District?s capital assets listing and those federal equipment and vehicle are properly tracked and maintained. Views of Responsible Officials: The District concurs with this recommendation and will review its procedures over capital asset and property control. Contact Person: Judy James, Business Manager
U.S. DEPARTMENT OF EDUCATION PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION COVID-19 ELEMENTARY AND SECONDARY SCHOOL EMERGENCY RELIEF FUND - AL NUMBERS 84.425D and 84.425U PASS-THROUGH NUMBER 2903 AUDIT PERIOD - YEAR ENDED JUNE 30, 2022 2022-001. Equipment and Real Property Management Criteria or specific requirement: The Davis-Bacon Act requires all contractors and subcontractors performing work on construction contracts in excess of $2,000, financed by Federal funds, to pay their laborers and mechanics not less than the prevailing wage rates as determined by the Department of Labor. Non-federal entities are to include in the applicable construction contracts a requirement that the contractor or subcontractor comply with the provisions of the Davis-Bacon Act and the Department of Labor regulations. Such requirements included the submission of weekly certified payrolls, for each week in which any contract work is performed, to the non-federal entities. Also, property records should be maintained for real property and improvements made to real property acquired with federal awards as specified in OMB 2 CFR sections 200.311 and 200.313. Condition: The District paid $335,500 for installation of an HVAC system from the Education Stabilization Fund without obtaining a written contract that included the prevailing wage rate clause. Additionally, weekly certified payrolls were not submitted to the District. Also, neither the HVAC system nor a facility improvement project totaling $397,081 were recorded in the District's capital asset subsidiary records. Cause: Lack of internal controls and management oversight resulted in the Davis-Bacon Act provisions not being properly followed and the capital asset subsidiary records not being accurate. Effect: The District did not comply with the notification requirements regarding compliance with the Davis-Bacon Act and was unable to provide copies of weekly certified payrolls for workers paid on the projects. The District's capital assets subsidiary records were not accurate. Context: Examined all payments/contracts for facility repairs and improvements paid from the Education Stabilization Fund. Recommendation: The District should contact the Arkansas Division of Elementary and Secondary Education (DESE) for guidance regarding this matter and implement proper controls over program expenditures. Views of responsible officials: We will contact DESE for guidance regarding this matter and implement proper controls over program expenditures.
U.S. DEPARTMENT OF EDUCATION PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION COVID-19 ELEMENTARY AND SECONDARY SCHOOL EMERGENCY RELIEF FUND - AL NUMBERS 84.425D and 84.425U PASS-THROUGH NUMBER 2903 AUDIT PERIOD - YEAR ENDED JUNE 30, 2022 2022-002. Equipment and Real Property Management Criteria or specific requirement: Proper records should be maintained for equipment acquired with federal awards as specified in 2 CFR section 200.313. Additionally, the District should ensure that disposition of such equipment is in accordance with federal requirements, including the federal awarding agency is appropriately compensated for its share of any property sold or converted to non-federal use. Condition: The District could not account for 2 of 28 Education Stabilization Fund equipment items purchased in previous years costing $4,341. Cause: Lack of internal controls over capital asset subsidiary records. Effect: The District's capital assets subsidiary records were not accurate. Context: Observation of 28 equipment items recorded on equipment subsidiary records at an initial cost of $493,581 from a total population of 277 items at an initial cost of $1,156,492. Recommendation: The District should maintain proper records for equipment acquired with federal awards. Views of responsible officials: The fever scanner had not been opened at the time of the equipment information submission from the facilities director?s secretary. The serial number had been submitted for the laptop that was purchased from a separate vendor and the cost was well below the capital assets threshold. Since fever scanners were no longer in use, the laptop had been given to an employee and could not be located. The fever scanners are all in storage but could not be identified because the serial number was for the laptop. The District will try and maintain proper records for all equipment.
U.S. DEPARTMENT OF EDUCATION PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION COVID-19 ELEMENTARY AND SECONDARY SCHOOL EMERGENCY RELIEF FUND - AL NUMBERS 84.425D and 84.425U PASS-THROUGH NUMBER 2903 AUDIT PERIOD - YEAR ENDED JUNE 30, 2022 2022-001. Equipment and Real Property Management Criteria or specific requirement: The Davis-Bacon Act requires all contractors and subcontractors performing work on construction contracts in excess of $2,000, financed by Federal funds, to pay their laborers and mechanics not less than the prevailing wage rates as determined by the Department of Labor. Non-federal entities are to include in the applicable construction contracts a requirement that the contractor or subcontractor comply with the provisions of the Davis-Bacon Act and the Department of Labor regulations. Such requirements included the submission of weekly certified payrolls, for each week in which any contract work is performed, to the non-federal entities. Also, property records should be maintained for real property and improvements made to real property acquired with federal awards as specified in OMB 2 CFR sections 200.311 and 200.313. Condition: The District paid $335,500 for installation of an HVAC system from the Education Stabilization Fund without obtaining a written contract that included the prevailing wage rate clause. Additionally, weekly certified payrolls were not submitted to the District. Also, neither the HVAC system nor a facility improvement project totaling $397,081 were recorded in the District's capital asset subsidiary records. Cause: Lack of internal controls and management oversight resulted in the Davis-Bacon Act provisions not being properly followed and the capital asset subsidiary records not being accurate. Effect: The District did not comply with the notification requirements regarding compliance with the Davis-Bacon Act and was unable to provide copies of weekly certified payrolls for workers paid on the projects. The District's capital assets subsidiary records were not accurate. Context: Examined all payments/contracts for facility repairs and improvements paid from the Education Stabilization Fund. Recommendation: The District should contact the Arkansas Division of Elementary and Secondary Education (DESE) for guidance regarding this matter and implement proper controls over program expenditures. Views of responsible officials: We will contact DESE for guidance regarding this matter and implement proper controls over program expenditures.
U.S. DEPARTMENT OF EDUCATION PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION COVID-19 ELEMENTARY AND SECONDARY SCHOOL EMERGENCY RELIEF FUND - AL NUMBERS 84.425D and 84.425U PASS-THROUGH NUMBER 2903 AUDIT PERIOD - YEAR ENDED JUNE 30, 2022 2022-002. Equipment and Real Property Management Criteria or specific requirement: Proper records should be maintained for equipment acquired with federal awards as specified in 2 CFR section 200.313. Additionally, the District should ensure that disposition of such equipment is in accordance with federal requirements, including the federal awarding agency is appropriately compensated for its share of any property sold or converted to non-federal use. Condition: The District could not account for 2 of 28 Education Stabilization Fund equipment items purchased in previous years costing $4,341. Cause: Lack of internal controls over capital asset subsidiary records. Effect: The District's capital assets subsidiary records were not accurate. Context: Observation of 28 equipment items recorded on equipment subsidiary records at an initial cost of $493,581 from a total population of 277 items at an initial cost of $1,156,492. Recommendation: The District should maintain proper records for equipment acquired with federal awards. Views of responsible officials: The fever scanner had not been opened at the time of the equipment information submission from the facilities director?s secretary. The serial number had been submitted for the laptop that was purchased from a separate vendor and the cost was well below the capital assets threshold. Since fever scanners were no longer in use, the laptop had been given to an employee and could not be located. The fever scanners are all in storage but could not be identified because the serial number was for the laptop. The District will try and maintain proper records for all equipment.
U.S. DEPARTMENT OF EDUCATION PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION COVID-19 ELEMENTARY AND SECONDARY SCHOOL EMERGENCY RELIEF FUND - AL NUMBERS 84.425D and 84.425U PASS-THROUGH NUMBER 2903 AUDIT PERIOD - YEAR ENDED JUNE 30, 2022 2022-001. Equipment and Real Property Management Criteria or specific requirement: The Davis-Bacon Act requires all contractors and subcontractors performing work on construction contracts in excess of $2,000, financed by Federal funds, to pay their laborers and mechanics not less than the prevailing wage rates as determined by the Department of Labor. Non-federal entities are to include in the applicable construction contracts a requirement that the contractor or subcontractor comply with the provisions of the Davis-Bacon Act and the Department of Labor regulations. Such requirements included the submission of weekly certified payrolls, for each week in which any contract work is performed, to the non-federal entities. Also, property records should be maintained for real property and improvements made to real property acquired with federal awards as specified in OMB 2 CFR sections 200.311 and 200.313. Condition: The District paid $335,500 for installation of an HVAC system from the Education Stabilization Fund without obtaining a written contract that included the prevailing wage rate clause. Additionally, weekly certified payrolls were not submitted to the District. Also, neither the HVAC system nor a facility improvement project totaling $397,081 were recorded in the District's capital asset subsidiary records. Cause: Lack of internal controls and management oversight resulted in the Davis-Bacon Act provisions not being properly followed and the capital asset subsidiary records not being accurate. Effect: The District did not comply with the notification requirements regarding compliance with the Davis-Bacon Act and was unable to provide copies of weekly certified payrolls for workers paid on the projects. The District's capital assets subsidiary records were not accurate. Context: Examined all payments/contracts for facility repairs and improvements paid from the Education Stabilization Fund. Recommendation: The District should contact the Arkansas Division of Elementary and Secondary Education (DESE) for guidance regarding this matter and implement proper controls over program expenditures. Views of responsible officials: We will contact DESE for guidance regarding this matter and implement proper controls over program expenditures.
U.S. DEPARTMENT OF EDUCATION PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION COVID-19 ELEMENTARY AND SECONDARY SCHOOL EMERGENCY RELIEF FUND - AL NUMBERS 84.425D and 84.425U PASS-THROUGH NUMBER 2903 AUDIT PERIOD - YEAR ENDED JUNE 30, 2022 2022-002. Equipment and Real Property Management Criteria or specific requirement: Proper records should be maintained for equipment acquired with federal awards as specified in 2 CFR section 200.313. Additionally, the District should ensure that disposition of such equipment is in accordance with federal requirements, including the federal awarding agency is appropriately compensated for its share of any property sold or converted to non-federal use. Condition: The District could not account for 2 of 28 Education Stabilization Fund equipment items purchased in previous years costing $4,341. Cause: Lack of internal controls over capital asset subsidiary records. Effect: The District's capital assets subsidiary records were not accurate. Context: Observation of 28 equipment items recorded on equipment subsidiary records at an initial cost of $493,581 from a total population of 277 items at an initial cost of $1,156,492. Recommendation: The District should maintain proper records for equipment acquired with federal awards. Views of responsible officials: The fever scanner had not been opened at the time of the equipment information submission from the facilities director?s secretary. The serial number had been submitted for the laptop that was purchased from a separate vendor and the cost was well below the capital assets threshold. Since fever scanners were no longer in use, the laptop had been given to an employee and could not be located. The fever scanners are all in storage but could not be identified because the serial number was for the laptop. The District will try and maintain proper records for all equipment.
SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS 1. FINDING NUMBER: 2022- 002 2. THIS FINDING IS: X New Repeat from Prior year? Year originally reported? 3. Federal Program Name and Year: COVID 19: Education Stabilization Fund (2021 & 2022) 4. Project No.: 4998-ER, E2, D2, E3 & HL 5. CFDA No.: 84.425D-COVID 19, 84.425U-COVID 19, 84.425W-COVID 19 6. Passed Through: Illinois State Board of Education 7. Federal Agency: Department of Education 8. Criteria or specific requirement (including statutory, regulatory, or other citation) Equipment and Real Property Management compliance requirements require that property records be maintained that include a description of the property, a serial number or other identification number, the source of funding of 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 the sales price of the property. (2 CFR section 200.313(d)(1)) 9. Condition The District's property records did not include serial numbers for equipment purchased with Education Stabilization Funding. 10. Questioned Costs None 11. Context The inventory of equipment is material to the program. 12. Effect The District is not in compliance with Equipment and Real Property Management compliance requirements. 13. Cause The District was not aware that serial numbers needed to be included in the property records. 14. Recommendation The District should assign an employee independent of the preparer, preferably with knowledge of applicable federal grant expenditures, to review the District's property records on a periodic basis to ensure the listing meets the requirements of 2 CFR section 200.313(d)(1). 15. Management's response Management will implement the auditor's recommendation for the year ended June 30, 2023.
SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS 1. FINDING NUMBER: 2022- 002 2. THIS FINDING IS: X New Repeat from Prior year? Year originally reported? 3. Federal Program Name and Year: COVID 19: Education Stabilization Fund (2021 & 2022) 4. Project No.: 4998-ER, E2, D2, E3 & HL 5. CFDA No.: 84.425D-COVID 19, 84.425U-COVID 19, 84.425W-COVID 19 6. Passed Through: Illinois State Board of Education 7. Federal Agency: Department of Education 8. Criteria or specific requirement (including statutory, regulatory, or other citation) Equipment and Real Property Management compliance requirements require that property records be maintained that include a description of the property, a serial number or other identification number, the source of funding of 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 the sales price of the property. (2 CFR section 200.313(d)(1)) 9. Condition The District's property records did not include serial numbers for equipment purchased with Education Stabilization Funding. 10. Questioned Costs None 11. Context The inventory of equipment is material to the program. 12. Effect The District is not in compliance with Equipment and Real Property Management compliance requirements. 13. Cause The District was not aware that serial numbers needed to be included in the property records. 14. Recommendation The District should assign an employee independent of the preparer, preferably with knowledge of applicable federal grant expenditures, to review the District's property records on a periodic basis to ensure the listing meets the requirements of 2 CFR section 200.313(d)(1). 15. Management's response Management will implement the auditor's recommendation for the year ended June 30, 2023.
SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS 1. FINDING NUMBER: 2022- 002 2. THIS FINDING IS: X New Repeat from Prior year? Year originally reported? 3. Federal Program Name and Year: COVID 19: Education Stabilization Fund (2021 & 2022) 4. Project No.: 4998-ER, E2, D2, E3 & HL 5. CFDA No.: 84.425D-COVID 19, 84.425U-COVID 19, 84.425W-COVID 19 6. Passed Through: Illinois State Board of Education 7. Federal Agency: Department of Education 8. Criteria or specific requirement (including statutory, regulatory, or other citation) Equipment and Real Property Management compliance requirements require that property records be maintained that include a description of the property, a serial number or other identification number, the source of funding of 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 the sales price of the property. (2 CFR section 200.313(d)(1)) 9. Condition The District's property records did not include serial numbers for equipment purchased with Education Stabilization Funding. 10. Questioned Costs None 11. Context The inventory of equipment is material to the program. 12. Effect The District is not in compliance with Equipment and Real Property Management compliance requirements. 13. Cause The District was not aware that serial numbers needed to be included in the property records. 14. Recommendation The District should assign an employee independent of the preparer, preferably with knowledge of applicable federal grant expenditures, to review the District's property records on a periodic basis to ensure the listing meets the requirements of 2 CFR section 200.313(d)(1). 15. Management's response Management will implement the auditor's recommendation for the year ended June 30, 2023.
SIGNIFICANT DEFICIENCY Federal Program: Education Stabilization Fund Elementary and Secondary School Emergency Relief Fund Assistance Listing Number: 84.425D Condition The School completed an inventory of its equipment for the year ended June 30, 2022. However, this inventory was not compared to the School?s record of equipment and real property purchased with federal funds. Criteria 2 CFR part 200.313 requires property records be maintained that include all property purchased using federal funds. 2 CFR part 200.313(d)(2) states: A physical inventory of the property must be taken, and the results reconciled with the property records at least once every two years. Cause The School was not aware of the requirements outlined in the Criteria section above. Effect The School did not comply with the requirements to reconcile its physical inventory with its property records. Recommendation We recommend the School develop internal controls to ensure the physical inventory is reconciled with its property records at least once every two years. Views of Responsible Officials and Planned Corrective Actions The School?s Corrective Action Plan is included on page 24.
SIGNIFICANT DEFICIENCY Federal Program: Education Stabilization Fund Elementary and Secondary School Emergency Relief Fund Assistance Listing Number: 84.425D Condition The School completed an inventory of its equipment for the year ended June 30, 2022. However, this inventory was not compared to the School?s record of equipment and real property purchased with federal funds. Criteria 2 CFR part 200.313 requires property records be maintained that include all property purchased using federal funds. 2 CFR part 200.313(d)(2) states: A physical inventory of the property must be taken, and the results reconciled with the property records at least once every two years. Cause The School was not aware of the requirements outlined in the Criteria section above. Effect The School did not comply with the requirements to reconcile its physical inventory with its property records. Recommendation We recommend the School develop internal controls to ensure the physical inventory is reconciled with its property records at least once every two years. Views of Responsible Officials and Planned Corrective Actions The School?s Corrective Action Plan is included on page 24.
SIGNIFICANT DEFICIENCY Federal Program: Education Stabilization Fund Elementary and Secondary School Emergency Relief Fund Assistance Listing Number: 84.425D Condition The School completed an inventory of its equipment for the year ended June 30, 2022. However, this inventory was not compared to the School?s record of equipment and real property purchased with federal funds. Criteria 2 CFR part 200.313 requires property records be maintained that include all property purchased using federal funds. 2 CFR part 200.313(d)(2) states: A physical inventory of the property must be taken, and the results reconciled with the property records at least once every two years. Cause The School was not aware of the requirements outlined in the Criteria section above. Effect The School did not comply with the requirements to reconcile its physical inventory with its property records. Recommendation We recommend the School develop internal controls to ensure the physical inventory is reconciled with its property records at least once every two years. Views of Responsible Officials and Planned Corrective Actions The School?s Corrective Action Plan is included on page 24.
Finding: The District did not always comply with Federal regulations by maintaining inventory records to identify the location of certain equipment, resulting in ESSER Fund questioned costs totaling $1,565,006.14. Criteria: Title 2, Section 200.313(d)(1), CFR, requires that for equipment, 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 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. Title 2, Section 200.313(a), CFR, defines equipment as tangible property, including information technology systems, having a useful life of one year and a per-unit acquisition cost which equals or exceeds the lesser of the capitalization threshold established by District. Per Board Policy 7.77 ? Inventories and Property Records, the Superintendent or designee shall maintain an adequate and accurate record of all tangible personal property of the District. All equipment shall be listed that has a value or cost of $1,000 or more. Condition: During the 2021-22 fiscal year, District ESSER Fund expenditures totaled $7,086,240.23, including $3,423,497.39 expended for capital outlay. As part of our audit, we examined District records and noted equipment acquisitions totaling $1,565,006.14 for 513 items with costs exceeding the District?s $1,000 capitalization threshold. Although we requested, District personnel did not provide inventory records to identify the location of any of these items. Cause: District personnel indicated that the missing inventory information was an oversight as the employee responsible for recording property items in the inventory records was not timely provided with the appropriate acquisition information. Effect: Without effective accountability over Federal equipment, including the maintenance of appropriate inventory records, there is an increased risk that the equipment may be used for unauthorized purposes. Absent identification of the equipment location, the ESSER Fund equipment acquisitions totaling $1,565,006.14 represent questioned costs. Recommendation: The District should conduct a thorough investigation of the ESSER Fund capital outlay expenditures to identify equipment acquisitions with costs exceeding the District $1,000 capitalization threshold, locate the applicable items, and prepare and maintain appropriate inventory records for those items. In addition, the District should restore to the FDOE the questioned costs related to any unlocated items and contact applicable law enforcement agencies regarding other necessary actions to help recover the equipment. District Response: The District will enhance inventory records and procedures to ensure that all property items are properly recorded in order to maintain accountability of items purchased with Federal funds. Additionally, the District will consult with the grantor agency regarding the allowability of the questioned costs.
1. FINDING NUMBER: 2022- 002 2. THIS FINDING IS: X New Repeat from Prior year? Year originally reported? 3. Federal Program Name and Year: COVID 19: Education Stabilization Fund (2021 & 2022) 4. Project No.: 4998-E2 5. CFDA No.: 84.425D-COVID 19 6. Passed Through: Illinois State Board of Education 7. Federal Agency: Department of Education 8. Criteria or specific requirement (including statutory, regulatory, or other citation) Equipment and Real Property Management compliance requirements require that complete property records be maintained that include a description of the property, a serial number or other identification number, the source of funding of 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 the sales price of the property. (2 CFR section 200.313(d)(1) 9. Condition The District's property records did not include all equipment purchased with federal funds as per 2 CFR section 200.313(d)(1). 10. Questioned Costs None 11. Context The inventory of equipment is material to the program. 12. Effect The District is not in compliance with Equipment and Real Property Management compliance requirements. 13. Cause The District administrative staff does not maintain a complete list of all equipment purchased with federal funds. 14. Recommendation The District should assign an administrative employee with knowledge of applicable federal grant expenditures to maintain a complete list of property records that meets the requirements of 2 CFR section 200.313(d)(1). 15. Management's response Management will implement the auditor's recommendation for the year ended June 30, 2023.
New York City Department of Investigation (?DOI?) Finding #: 2022-009 Funding Year(s): 7/1/2021 ? 6/30/2022 Equitable Sharing Program (FAL #16.922) Contract Numbers: N/A Federal Agency: U.S. Department of Justice Type of Finding: Equipment and Real Property Management - Compliance and Internal Control (Significant Deficiency) Criteria: In accordance with 2 CFR section 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 (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. Additionally, as stipulated by 2 CFR section 200.313(d)(2), a physical inventory of property and equipment acquired under a federal award must be taken, and the results reconciled with the property records, at least once every two years. Also, as stipulated by 2 CFR Section 200.303, recipients of Federal Awards are required to establish and maintain an internal control environment that complies with either the guidance in ?Standards for Internal Control in the Federal Government? (the ?Green Book?) 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?) for the federal funding streams it administers. Condition/Context: From a non-statistical sample of forty (40) pieces of equipment subjected to testing, we identified the following errors: ? Seven (7) pieces of equipment were disposed of in fiscal 2019 but the disposition data was not properly updated and the equipment was not removed from the active inventory listing. ? For seven (7) pieces of equipment, DOI was unable to provide evidence that a physical inventory and reconciliation back to property records was performed and documented within the required two-year timeframe. ? For all forty (40) pieces of equipment, DOI was unable to provide supporting documentation that a review and approval of the inventory had taken place at the time the inventory was conducted. Cause/Effect: While DOI had certain procedures in place to monitor their equipment purchased with Federal funding, such procedures were not adequate to ensure that each aspect of the equipment and real property management compliance requirements were performed and documented within the requirement timeframe, which resulted in the findings noted above. Without the appropriate internal controls and monitoring procedures in place, federally funded equipment could be inaccurately recorded on inventory records and not discovered and corrected timely, inventory could be misplaced, misappropriated, or otherwise disposed of outside of the requirements of the federal guidelines Questioned Costs: None identified. Identification as a Repeat Finding: This is not a repeat finding Recommendation: We recommend that DOI strengthen controls over the inventory process to ensure dispositions of equipment are updated in the equipment records, inventories performed are reconciled back to equipment records, biennial inventory counts are consistently performed over all equipment within the required timeframe, and that the review and approval of each inventory performed is appropriately documented.
New York City Police Department (?NYPD?) Finding #: 2022-010 Funding Year(s): 7/1/2021 ? 6/30/2022 Equitable Sharing Program (FAL #16.922) Contract Numbers: N/A Federal Agency: U.S. Department of Justice Type of Finding: Equipment and Real Property Management - Compliance and Internal Control (Significant Deficiency) Criteria: As stipulated by 2 CFR section 200.313(d)(2), a physical inventory of property and equipment acquired under a federal award must be taken, and the results reconciled with the property records, at least once every two (2) years. Also, as stipulated by 2 CFR Section 200.303, recipients of Federal Awards are required to establish and maintain an internal control environment that complies with either the guidance in ?Standards for Internal Control in the Federal Government? (the ?Green Book?) 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?) for the federal funding streams it administers. Condition/Context: From a non-statistical sample of four (4) pieces of equipment subjected to testing, we identified that NYPD was unable to provide supporting documentation that a review and approval of the inventory had taken place at the time the inventory was conducted for all items selected for testing. Cause/Effect: While NYPD had certain procedures in place to monitor their equipment purchased with Federal funding, such procedures were not adequate to ensure that each aspect of the equipment and real property management compliance requirements were documented, which resulted in the finding noted above. Without the appropriate internal controls and monitoring procedures in place, federally funded equipment could be inaccurately recorded on inventory records and not discovered and corrected timely, inventory could be misplaced, misappropriated, or otherwise disposed of outside of the requirements of the federal guidelines Questioned Costs: None identified. Identification as a Repeat Finding: This is not a repeat finding Recommendation: We recommend that NYPD strengthen controls over the inventory process to ensure that the review and approval of each inventory performed is appropriately documented.
Finding #: 2022-002 Funding Year(s): 7/1/2021-6/30/2022 Port Security Grant Program (FAL #97.056) Contract Number: EMW-2015-PU-APP-00314, EMW-2017-PU-00122 Federal Agency: U.S. Department of Homeland Security Type of Finding: Equipment and Real Property Management - Compliance and Internal Control (Control Deficiency) Criteria: As stipulated by 2 CFR sections 200.313(d)(2), a physical inventory of property and equipment acquired under a federal award must be taken, and the results reconciled with the property records, at least once every two years. Condition/Context: The New York City Police Department (?NYPD?) utilizes the City?s Grants Tracking System (?GTS?), a citywide web-based inventory program, designed to standardize the tracking of federally funded equipment. Further, NYPD Command-designated grants coordinators are responsible for monitoring the equipment and updating the inventory on a periodic basis in accordance with federal guidelines. The NYPD Grants Unit periodically generates an inventory listing from GTS that includes the biennial inventory count due date for each item and distributes it to the assigned NYPD Command designated grant coordinators to ensure the inventory count is conducted timely and in accordance with federal requirements. After the completion of biennial inventory count, the NYPD Command-designated grants coordinators update the inventory count information to GTS. From a haphazard sample of twenty (20) pieces of equipment subjected to testing, we identified three (3) items where the NYPD Command-designated grants coordinators were unable to support that a physical inventory count was conducted within the required two-year period as of June 30, 2022. Cause/Effect: During 2021, the Grants Tracking System was upgraded and the most recent inventory entry and the original acquisition information were migrated to the new system. However, inventory entries performed between acquisition and the most recent inventory entry were not migrated. As per the Office of Management and Budget (OMB), the citywide GTS is the record for all grant-related inventory information. The NYPD does not maintain a separate inventory tracking mechanism. As a result, NYPD could not provide documentation that they complied with 2 CFR sections 200.313(d)(2) as of year-end for three (3) pieces of equipment selected. Inventory counts that are not completed within the required timeframe could result in federally funded equipment being inaccurately recorded on the inventory records and not discovered and corrected timely. Questioned Costs: None identified. Identification as a Repeat Finding: This finding is similar to finding #2021-003 included on pages 232 through 233 of the Fiscal 2021 Single Audit report. Recommendation: We recommend that NYPD strengthen controls over the inventory process to ensure biennial inventory counts for all equipment are consistently performed and documented within the required timeframe, and that such documentation is properly maintained.
1. FINDING NUMBER: 2022- 003 2. THIS FINDING IS: X New Repeat from Prior year? Year originally reported? 3. Federal Program Name and Year: COVID 19: Education Stabilization Fund (2021 & 2022) 4. Project No.: 4998-E2 & E3 5. CFDA No.: 84.425D-COVID 19 & 84.425U-COVID 19 6. Passed Through: Illinois State Board of Education 7. Federal Agency: Department of Education 8. Criteria or specific requirement (including statutory, regulatory, or other citation) Equipment and Real Property Management compliance requirements require that property records be maintained that include a description of the property, a serial number or other identification number, the source of funding of 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 the sales price of the property. (2 CFR section 200.313(d)(1)) 9. Condition The District's property records did not include the required information for equipment purchased with Education Stabilization Funding. 10. Questioned Costs None 11. Context The inventory of equipment is material to the program. 12. Effect The District is not in compliance with Equipment and Real Property Management compliance requirements. 13. Cause The District was not aware of the level of detail needed to be included in the property records. 14. Recommendation The District should assign an employee independent of the preparer, preferably with knowledge of applicable federal grant expenditures, to review the District's property records on a periodic basis to ensure the listing meets the requirements of 2 CFR section 200.313(d)(1). 15. Management's response Management will implement the auditor's recommendation for the year ended June 30, 2023.
1. FINDING NUMBER: 2022- 003 2. THIS FINDING IS: X New Repeat from Prior year? Year originally reported? 3. Federal Program Name and Year: COVID 19: Education Stabilization Fund (2021 & 2022) 4. Project No.: 4998-E2 & E3 5. CFDA No.: 84.425D-COVID 19 & 84.425U-COVID 19 6. Passed Through: Illinois State Board of Education 7. Federal Agency: Department of Education 8. Criteria or specific requirement (including statutory, regulatory, or other citation) Equipment and Real Property Management compliance requirements require that property records be maintained that include a description of the property, a serial number or other identification number, the source of funding of 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 the sales price of the property. (2 CFR section 200.313(d)(1)) 9. Condition The District's property records did not include the required information for equipment purchased with Education Stabilization Funding. 10. Questioned Costs None 11. Context The inventory of equipment is material to the program. 12. Effect The District is not in compliance with Equipment and Real Property Management compliance requirements. 13. Cause The District was not aware of the level of detail needed to be included in the property records. 14. Recommendation The District should assign an employee independent of the preparer, preferably with knowledge of applicable federal grant expenditures, to review the District's property records on a periodic basis to ensure the listing meets the requirements of 2 CFR section 200.313(d)(1). 15. Management's response Management will implement the auditor's recommendation for the year ended June 30, 2023.
FINDING 2022-002 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: 84.425D Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Equipment and Real Property Management compliance requirement. INDIANA STATE BOARD OF ACCOUNTS 17 SCHOOL CITY OF MISHAWAKA SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The School Corporation did not properly maintain records for equipment purchased with grant funds. The School Corporation did not add eight of nine assets purchased with grant funds to the School Corporation's capital asset detailed ledger 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 the use and condition of the property nor were assets properly maintained and safeguarded. Additionally, the School Corporation was unable to provide documentation of a completed physical inventory during the audit period of July 1, 2020 to June 30, 2022. The lack of internal controls and noncompliance were systemic issues through 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: ". . . (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 the property in good condition. . . ." Cause Management had not developed a system of internal controls that would have ensured compliance with the Equipment and Real Property Management compliance requirement. INDIANA STATE BOARD OF ACCOUNTS 18 SCHOOL CITY OF MISHAWAKA SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Effect The failure to establish an effective internal control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement and the Equipment and Real Property Management compliance requirement could have result in the loss of future federal funds to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish internal controls to ensure compliance and comply with the grant agreement and the Equipment and Real Property Management compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-002 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: 84.425D Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Equipment and Real Property Management compliance requirement. INDIANA STATE BOARD OF ACCOUNTS 17 SCHOOL CITY OF MISHAWAKA SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The School Corporation did not properly maintain records for equipment purchased with grant funds. The School Corporation did not add eight of nine assets purchased with grant funds to the School Corporation's capital asset detailed ledger 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 the use and condition of the property nor were assets properly maintained and safeguarded. Additionally, the School Corporation was unable to provide documentation of a completed physical inventory during the audit period of July 1, 2020 to June 30, 2022. The lack of internal controls and noncompliance were systemic issues through 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: ". . . (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 the property in good condition. . . ." Cause Management had not developed a system of internal controls that would have ensured compliance with the Equipment and Real Property Management compliance requirement. INDIANA STATE BOARD OF ACCOUNTS 18 SCHOOL CITY OF MISHAWAKA SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Effect The failure to establish an effective internal control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement and the Equipment and Real Property Management compliance requirement could have result in the loss of future federal funds to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish internal controls to ensure compliance and comply with the grant agreement and the Equipment and Real Property Management compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-002 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: 84.425D Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Equipment and Real Property Management compliance requirement. INDIANA STATE BOARD OF ACCOUNTS 17 SCHOOL CITY OF MISHAWAKA SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The School Corporation did not properly maintain records for equipment purchased with grant funds. The School Corporation did not add eight of nine assets purchased with grant funds to the School Corporation's capital asset detailed ledger 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 the use and condition of the property nor were assets properly maintained and safeguarded. Additionally, the School Corporation was unable to provide documentation of a completed physical inventory during the audit period of July 1, 2020 to June 30, 2022. The lack of internal controls and noncompliance were systemic issues through 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: ". . . (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 the property in good condition. . . ." Cause Management had not developed a system of internal controls that would have ensured compliance with the Equipment and Real Property Management compliance requirement. INDIANA STATE BOARD OF ACCOUNTS 18 SCHOOL CITY OF MISHAWAKA SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Effect The failure to establish an effective internal control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement and the Equipment and Real Property Management compliance requirement could have result in the loss of future federal funds to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish internal controls to ensure compliance and comply with the grant agreement and the Equipment and Real Property Management compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
(2022-057) Title: Internal control over ESF subrecipient monitoring procedures needs improvement Prior Year Findings: None State Department: Education State Bureau: Commissioner?s Office Federal Agency: U.S. Department of Education Assistance Listing Title: Education Stabilization Fund (ESF) (COVID-19) Assistance Listing Number: 84.425D, 84.425R, 84.425U Federal Award Identification Number: S425C200004, S425C210004, S425D200004, S425D210004, S425U210004, S425W210020, S425R210044, S425B200039 Compliance Area: Subrecipient monitoring Type of Finding: Significant deficiency Questioned Costs: None Criteria: 2 CFR 200.303; 2 CFR 200.313; 2 CFR 200.332 The Department must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the Department is managing the award in compliance with Federal statutes, regulations, and the terms and conditions of the award. For equipment acquired with Federal funding, records must be maintained that include: ? a description and identification number; ? the source of funding, including the Federal Award Identification Number; ? who holds title and the acquisition date; ? the cost of the property, including the percentage of Federal participation in the project costs for the Federal award under which the property was acquired; ? the location, use and condition; and ? any ultimate disposition data including the date of disposal and sale price of the property. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. 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. The Department must monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Condition: The Education Stabilization Fund (ESF) provides funding to school administrative units (SAUs) to purchase equipment for use in preventing, preparing for, or responding to the COVID-19 pandemic. SAUs were required to submit applications to the Office of Federal Emergency Relief Programs (OFERP) under the Department of Education outlining identified uses for ESF including planned equipment purchases. Program coordinators within OFERP were responsible for reviewing and approving applications submitted by SAUs. Once there was an approved application on file, SAUs could submit reimbursement requests to the Department for equipment purchases identified and approved in the application. All SAU equipment purchases reimbursed with ESF are subject to applicable inventory control, log maintenance, and disposition requirements consistent with Federal regulations for equipment and real property management. During fiscal year 2022, the Department did not have policies and procedures in place to track SAU equipment purchases reimbursed with ESF; therefore, the Department does not have assurance that: ? a complete and accurate record of all equipment purchased with ESF funds was maintained by each SAU. ? proper monitoring activities surrounding subrecipient compliance with Federal regulations for equipment and real property management were conducted. Context: In fiscal year 2022, ESF expenditures totaled $126.4 million, of which $120.6 million was paid to subrecipient SAUs. Cause: ? Lack of policies and procedures ? Lack of supervisory oversight Effect: ? Noncompliance with Federal regulations ? Subrecipients may not be in compliance with equipment and real property management requirements. ? Assets purchased with ESF funds may not be properly safeguarded or maintained. Recommendation: We recommend that the Department implement policies and procedures to ensure that a complete and accurate record of all equipment purchased under ESF is maintained by the Department and by each SAU. This record should be utilized during subrecipient monitoring activities to verify subrecipient compliance with Federal regulations. Corrective Action Plan: See F-21 Management?s Response: The Department agrees with this finding. The Office of Federal Emergency Relief Programs will develop and implement policies and procedures so that complete and accurate records of all equipment purchased under ESF will be maintained by each SAU and the Department when collected during subrecipient monitoring. Contact: Shelly Chasse-Johndro, Director of OFERP, DOE, 207-458-3180 (State Number: 22-1235-06)
(2022-057) Title: Internal control over ESF subrecipient monitoring procedures needs improvement Prior Year Findings: None State Department: Education State Bureau: Commissioner?s Office Federal Agency: U.S. Department of Education Assistance Listing Title: Education Stabilization Fund (ESF) (COVID-19) Assistance Listing Number: 84.425D, 84.425R, 84.425U Federal Award Identification Number: S425C200004, S425C210004, S425D200004, S425D210004, S425U210004, S425W210020, S425R210044, S425B200039 Compliance Area: Subrecipient monitoring Type of Finding: Significant deficiency Questioned Costs: None Criteria: 2 CFR 200.303; 2 CFR 200.313; 2 CFR 200.332 The Department must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the Department is managing the award in compliance with Federal statutes, regulations, and the terms and conditions of the award. For equipment acquired with Federal funding, records must be maintained that include: ? a description and identification number; ? the source of funding, including the Federal Award Identification Number; ? who holds title and the acquisition date; ? the cost of the property, including the percentage of Federal participation in the project costs for the Federal award under which the property was acquired; ? the location, use and condition; and ? any ultimate disposition data including the date of disposal and sale price of the property. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. 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. The Department must monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Condition: The Education Stabilization Fund (ESF) provides funding to school administrative units (SAUs) to purchase equipment for use in preventing, preparing for, or responding to the COVID-19 pandemic. SAUs were required to submit applications to the Office of Federal Emergency Relief Programs (OFERP) under the Department of Education outlining identified uses for ESF including planned equipment purchases. Program coordinators within OFERP were responsible for reviewing and approving applications submitted by SAUs. Once there was an approved application on file, SAUs could submit reimbursement requests to the Department for equipment purchases identified and approved in the application. All SAU equipment purchases reimbursed with ESF are subject to applicable inventory control, log maintenance, and disposition requirements consistent with Federal regulations for equipment and real property management. During fiscal year 2022, the Department did not have policies and procedures in place to track SAU equipment purchases reimbursed with ESF; therefore, the Department does not have assurance that: ? a complete and accurate record of all equipment purchased with ESF funds was maintained by each SAU. ? proper monitoring activities surrounding subrecipient compliance with Federal regulations for equipment and real property management were conducted. Context: In fiscal year 2022, ESF expenditures totaled $126.4 million, of which $120.6 million was paid to subrecipient SAUs. Cause: ? Lack of policies and procedures ? Lack of supervisory oversight Effect: ? Noncompliance with Federal regulations ? Subrecipients may not be in compliance with equipment and real property management requirements. ? Assets purchased with ESF funds may not be properly safeguarded or maintained. Recommendation: We recommend that the Department implement policies and procedures to ensure that a complete and accurate record of all equipment purchased under ESF is maintained by the Department and by each SAU. This record should be utilized during subrecipient monitoring activities to verify subrecipient compliance with Federal regulations. Corrective Action Plan: See F-21 Management?s Response: The Department agrees with this finding. The Office of Federal Emergency Relief Programs will develop and implement policies and procedures so that complete and accurate records of all equipment purchased under ESF will be maintained by each SAU and the Department when collected during subrecipient monitoring. Contact: Shelly Chasse-Johndro, Director of OFERP, DOE, 207-458-3180 (State Number: 22-1235-06)
(2022-057) Title: Internal control over ESF subrecipient monitoring procedures needs improvement Prior Year Findings: None State Department: Education State Bureau: Commissioner?s Office Federal Agency: U.S. Department of Education Assistance Listing Title: Education Stabilization Fund (ESF) (COVID-19) Assistance Listing Number: 84.425D, 84.425R, 84.425U Federal Award Identification Number: S425C200004, S425C210004, S425D200004, S425D210004, S425U210004, S425W210020, S425R210044, S425B200039 Compliance Area: Subrecipient monitoring Type of Finding: Significant deficiency Questioned Costs: None Criteria: 2 CFR 200.303; 2 CFR 200.313; 2 CFR 200.332 The Department must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the Department is managing the award in compliance with Federal statutes, regulations, and the terms and conditions of the award. For equipment acquired with Federal funding, records must be maintained that include: ? a description and identification number; ? the source of funding, including the Federal Award Identification Number; ? who holds title and the acquisition date; ? the cost of the property, including the percentage of Federal participation in the project costs for the Federal award under which the property was acquired; ? the location, use and condition; and ? any ultimate disposition data including the date of disposal and sale price of the property. A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. 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. The Department must monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Condition: The Education Stabilization Fund (ESF) provides funding to school administrative units (SAUs) to purchase equipment for use in preventing, preparing for, or responding to the COVID-19 pandemic. SAUs were required to submit applications to the Office of Federal Emergency Relief Programs (OFERP) under the Department of Education outlining identified uses for ESF including planned equipment purchases. Program coordinators within OFERP were responsible for reviewing and approving applications submitted by SAUs. Once there was an approved application on file, SAUs could submit reimbursement requests to the Department for equipment purchases identified and approved in the application. All SAU equipment purchases reimbursed with ESF are subject to applicable inventory control, log maintenance, and disposition requirements consistent with Federal regulations for equipment and real property management. During fiscal year 2022, the Department did not have policies and procedures in place to track SAU equipment purchases reimbursed with ESF; therefore, the Department does not have assurance that: ? a complete and accurate record of all equipment purchased with ESF funds was maintained by each SAU. ? proper monitoring activities surrounding subrecipient compliance with Federal regulations for equipment and real property management were conducted. Context: In fiscal year 2022, ESF expenditures totaled $126.4 million, of which $120.6 million was paid to subrecipient SAUs. Cause: ? Lack of policies and procedures ? Lack of supervisory oversight Effect: ? Noncompliance with Federal regulations ? Subrecipients may not be in compliance with equipment and real property management requirements. ? Assets purchased with ESF funds may not be properly safeguarded or maintained. Recommendation: We recommend that the Department implement policies and procedures to ensure that a complete and accurate record of all equipment purchased under ESF is maintained by the Department and by each SAU. This record should be utilized during subrecipient monitoring activities to verify subrecipient compliance with Federal regulations. Corrective Action Plan: See F-21 Management?s Response: The Department agrees with this finding. The Office of Federal Emergency Relief Programs will develop and implement policies and procedures so that complete and accurate records of all equipment purchased under ESF will be maintained by each SAU and the Department when collected during subrecipient monitoring. Contact: Shelly Chasse-Johndro, Director of OFERP, DOE, 207-458-3180 (State Number: 22-1235-06)
FINDING 2022-008 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, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system was not designed, nor implemented at the School Corporation to ensure compliance with requirements related to the grant agreement and Equipment and Real Property Management compliance requirement. The School Corporation paid $2,135,000 for HVAC and flooring improvements at various locations using COVID-19 - Education Stabilization Fund grant funds. These capital improvements were not added to a detailed listing of capital assets that 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 the use and condition of the property. A physical inventory had been taken in the past two years; however, the physical inventory was not reconciled with the capital assets listing. In addition, assets were not properly safeguarded and maintained. 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 the property in good condition. . . ." Cause Management had not designed, nor implemented a system of internal controls that would have ensured compliance with the Equipment and Real Property Management compliance requirement. Effect The failure to establish an effective internal control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement and the Equipment and Real Property Management compliance requirement could result in the loss of future federal funds to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish internal controls to ensure compliance and comply with the grant agreement and the Equipment and Real Property Management compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-008 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, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system was not designed, nor implemented at the School Corporation to ensure compliance with requirements related to the grant agreement and Equipment and Real Property Management compliance requirement. The School Corporation paid $2,135,000 for HVAC and flooring improvements at various locations using COVID-19 - Education Stabilization Fund grant funds. These capital improvements were not added to a detailed listing of capital assets that 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 the use and condition of the property. A physical inventory had been taken in the past two years; however, the physical inventory was not reconciled with the capital assets listing. In addition, assets were not properly safeguarded and maintained. 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 the property in good condition. . . ." Cause Management had not designed, nor implemented a system of internal controls that would have ensured compliance with the Equipment and Real Property Management compliance requirement. Effect The failure to establish an effective internal control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement and the Equipment and Real Property Management compliance requirement could result in the loss of future federal funds to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish internal controls to ensure compliance and comply with the grant agreement and the Equipment and Real Property Management compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-008 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, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system was not designed, nor implemented at the School Corporation to ensure compliance with requirements related to the grant agreement and Equipment and Real Property Management compliance requirement. The School Corporation paid $2,135,000 for HVAC and flooring improvements at various locations using COVID-19 - Education Stabilization Fund grant funds. These capital improvements were not added to a detailed listing of capital assets that 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 the use and condition of the property. A physical inventory had been taken in the past two years; however, the physical inventory was not reconciled with the capital assets listing. In addition, assets were not properly safeguarded and maintained. 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 the property in good condition. . . ." Cause Management had not designed, nor implemented a system of internal controls that would have ensured compliance with the Equipment and Real Property Management compliance requirement. Effect The failure to establish an effective internal control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement and the Equipment and Real Property Management compliance requirement could result in the loss of future federal funds to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish internal controls to ensure compliance and comply with the grant agreement and the Equipment and Real Property Management compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-004 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: 84.425 Federal Award Numbers and Years (or Other Identifying Numbers): 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 An effective internal control system, which would include segregation of duties, was not in place at the School Corporation to ensure compliance with requirements related to the grant agreement and the Equipment and Real Property Management compliance requirement. The School Corporation paid $481,504 for smart boards with COVID-19 - Education Stabilization Fund program funds. These assets were not added to a detailed listing of capital assets that 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 the title, acquisition date, cost of property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location and the use and condition of the property. Additionally, the School Corporation performed a physical inventory in November of 2021, which included the smart boards; however, the inventory was not reconciled to the capital asset records. As a result, these assets were not properly safeguarded and maintained. 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. . . . Cause Management had not developed or implemented a system of internal control that would have ensured compliance with the grant agreement and the Equipment and Real Property Management compliance requirement. Effect The failure to establish an effective internal control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement and the Equipment and Real Property Management compliance requirement could result in the loss of future federal funds to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal control to ensure compliance and comply with the grant agreement and the Equipment and Real Property Management compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-004 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: 84.425 Federal Award Numbers and Years (or Other Identifying Numbers): 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 An effective internal control system, which would include segregation of duties, was not in place at the School Corporation to ensure compliance with requirements related to the grant agreement and the Equipment and Real Property Management compliance requirement. The School Corporation paid $481,504 for smart boards with COVID-19 - Education Stabilization Fund program funds. These assets were not added to a detailed listing of capital assets that 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 the title, acquisition date, cost of property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location and the use and condition of the property. Additionally, the School Corporation performed a physical inventory in November of 2021, which included the smart boards; however, the inventory was not reconciled to the capital asset records. As a result, these assets were not properly safeguarded and maintained. 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. . . . Cause Management had not developed or implemented a system of internal control that would have ensured compliance with the grant agreement and the Equipment and Real Property Management compliance requirement. Effect The failure to establish an effective internal control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement and the Equipment and Real Property Management compliance requirement could result in the loss of future federal funds to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal control to ensure compliance and comply with the grant agreement and the Equipment and Real Property Management compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-002 EDUCATION STABILIZATION FUND (50000) Federal Agency: U.S. Department of Education Pass through Entity: California Department of Education Program Names: Elementary and Secondary School Emergency Relief I, II, III (ESSER, ESSER II, ESSER III) (Assistance Listing 84.425, D, U) Criteria: Consistent with 2CFR Section 200.311 (real property), Section 200.313 (equipment), and Section 200.439 (equipment and other capital expenditures) Education Stabilization Funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by the Department of Education or the pass-through entity. Condition: The District purchased numerous equipment items above the capital threshold for federal purchases but did not obtain approval from the California Department of Education. Questioned Costs: Purchases totaling $329,699.90 were made for equipment above the capital threshold without CDE approval. Context: The finding is limited to purchases above the capital threshold requiring approval. This is not a repeat finding. Cause: The District was unaware of the requirement. Effect: The funds spent on this purchase may be subject to review or return to the awarding agency. Recommendation: We recommend the District submit requests for approval for the equipment or find another allowable funding source for the purchases. CDE has stated that it will accept requests after the fact. Views of responsible officials: Staff and management will ensure that the District submits requests for approval for capital expenditures from the California Department of Education prior to purchases.
FINDING 2022-002 EDUCATION STABILIZATION FUND (50000) Federal Agency: U.S. Department of Education Pass through Entity: California Department of Education Program Names: Elementary and Secondary School Emergency Relief I, II, III (ESSER, ESSER II, ESSER III) (Assistance Listing 84.425, D, U) Criteria: Consistent with 2CFR Section 200.311 (real property), Section 200.313 (equipment), and Section 200.439 (equipment and other capital expenditures) Education Stabilization Funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by the Department of Education or the pass-through entity. Condition: The District purchased numerous equipment items above the capital threshold for federal purchases but did not obtain approval from the California Department of Education. Questioned Costs: Purchases totaling $329,699.90 were made for equipment above the capital threshold without CDE approval. Context: The finding is limited to purchases above the capital threshold requiring approval. This is not a repeat finding. Cause: The District was unaware of the requirement. Effect: The funds spent on this purchase may be subject to review or return to the awarding agency. Recommendation: We recommend the District submit requests for approval for the equipment or find another allowable funding source for the purchases. CDE has stated that it will accept requests after the fact. Views of responsible officials: Staff and management will ensure that the District submits requests for approval for capital expenditures from the California Department of Education prior to purchases.
FINDING 2022-002 EDUCATION STABILIZATION FUND (50000) Federal Agency: U.S. Department of Education Pass through Entity: California Department of Education Program Names: Elementary and Secondary School Emergency Relief I, II, III (ESSER, ESSER II, ESSER III) (Assistance Listing 84.425, D, U) Criteria: Consistent with 2CFR Section 200.311 (real property), Section 200.313 (equipment), and Section 200.439 (equipment and other capital expenditures) Education Stabilization Funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by the Department of Education or the pass-through entity. Condition: The District purchased numerous equipment items above the capital threshold for federal purchases but did not obtain approval from the California Department of Education. Questioned Costs: Purchases totaling $329,699.90 were made for equipment above the capital threshold without CDE approval. Context: The finding is limited to purchases above the capital threshold requiring approval. This is not a repeat finding. Cause: The District was unaware of the requirement. Effect: The funds spent on this purchase may be subject to review or return to the awarding agency. Recommendation: We recommend the District submit requests for approval for the equipment or find another allowable funding source for the purchases. CDE has stated that it will accept requests after the fact. Views of responsible officials: Staff and management will ensure that the District submits requests for approval for capital expenditures from the California Department of Education prior to purchases.
FINDING 2022-001 ? Equipment and Real Property Management ? Significant Deficiency in Internal Controls and Instance of Non-Compliance "See Schedule of Findings and Questioned Costs for chart/table" Criteria: An institution must conduct a physical inventory of equipment and real property at least once every two years with results reconciled with the equipment records (2 CFR section 200.313(d)(2)). Condition/Context: In testing equipment and real property management, we requested from management support for their conduction of a physical inventory of equipment and real property acquired with federal funds. We noted management was unable to produce such records, as a physical inventory of federal equipment and real property had not been conducted within the required two-year period. Cause: There was a lapse in internal controls surrounding monitoring the physical inventory of equipment and real property acquired with federal funds. Effect: The College did not timely conduct their physical inventory of equipment and real property acquired with federal funds within the two-year period. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the College implement a policy to monitor the physical inventory of equipment and real property acquired with federal funds at least once during each two-year period. Views of responsible officials: Management agrees there was a lapse in controls surrounding monitoring the physical inventory of equipment and real property acquired with federal funds. New and revised controls will be implemented to ensure a physical inventory of federally acquired equipment and real property is conducted within the required two-year period. These controls include performing this physical inventory at least annually to ensure the two-year requirement is met.
FINDING 2022-001 ? Equipment and Real Property Management ? Significant Deficiency in Internal Controls and Instance of Non-Compliance "See Schedule of Findings and Questioned Costs for chart/table" Criteria: An institution must conduct a physical inventory of equipment and real property at least once every two years with results reconciled with the equipment records (2 CFR section 200.313(d)(2)). Condition/Context: In testing equipment and real property management, we requested from management support for their conduction of a physical inventory of equipment and real property acquired with federal funds. We noted management was unable to produce such records, as a physical inventory of federal equipment and real property had not been conducted within the required two-year period. Cause: There was a lapse in internal controls surrounding monitoring the physical inventory of equipment and real property acquired with federal funds. Effect: The College did not timely conduct their physical inventory of equipment and real property acquired with federal funds within the two-year period. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the College implement a policy to monitor the physical inventory of equipment and real property acquired with federal funds at least once during each two-year period. Views of responsible officials: Management agrees there was a lapse in controls surrounding monitoring the physical inventory of equipment and real property acquired with federal funds. New and revised controls will be implemented to ensure a physical inventory of federally acquired equipment and real property is conducted within the required two-year period. These controls include performing this physical inventory at least annually to ensure the two-year requirement is met.
FINDING 2022-001 ? Equipment and Real Property Management ? Significant Deficiency in Internal Controls and Instance of Non-Compliance "See Schedule of Findings and Questioned Costs for chart/table" Criteria: An institution must conduct a physical inventory of equipment and real property at least once every two years with results reconciled with the equipment records (2 CFR section 200.313(d)(2)). Condition/Context: In testing equipment and real property management, we requested from management support for their conduction of a physical inventory of equipment and real property acquired with federal funds. We noted management was unable to produce such records, as a physical inventory of federal equipment and real property had not been conducted within the required two-year period. Cause: There was a lapse in internal controls surrounding monitoring the physical inventory of equipment and real property acquired with federal funds. Effect: The College did not timely conduct their physical inventory of equipment and real property acquired with federal funds within the two-year period. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the College implement a policy to monitor the physical inventory of equipment and real property acquired with federal funds at least once during each two-year period. Views of responsible officials: Management agrees there was a lapse in controls surrounding monitoring the physical inventory of equipment and real property acquired with federal funds. New and revised controls will be implemented to ensure a physical inventory of federally acquired equipment and real property is conducted within the required two-year period. These controls include performing this physical inventory at least annually to ensure the two-year requirement is met.
FINDING 2022-001 ? Equipment and Real Property Management ? Significant Deficiency in Internal Controls and Instance of Non-Compliance "See Schedule of Findings and Questioned Costs for chart/table" Criteria: An institution must conduct a physical inventory of equipment and real property at least once every two years with results reconciled with the equipment records (2 CFR section 200.313(d)(2)). Condition/Context: In testing equipment and real property management, we requested from management support for their conduction of a physical inventory of equipment and real property acquired with federal funds. We noted management was unable to produce such records, as a physical inventory of federal equipment and real property had not been conducted within the required two-year period. Cause: There was a lapse in internal controls surrounding monitoring the physical inventory of equipment and real property acquired with federal funds. Effect: The College did not timely conduct their physical inventory of equipment and real property acquired with federal funds within the two-year period. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the College implement a policy to monitor the physical inventory of equipment and real property acquired with federal funds at least once during each two-year period. Views of responsible officials: Management agrees there was a lapse in controls surrounding monitoring the physical inventory of equipment and real property acquired with federal funds. New and revised controls will be implemented to ensure a physical inventory of federally acquired equipment and real property is conducted within the required two-year period. These controls include performing this physical inventory at least annually to ensure the two-year requirement is met.
FINDING 2022-001 ? Equipment and Real Property Management ? Significant Deficiency in Internal Controls and Instance of Non-Compliance "See Schedule of Findings and Questioned Costs for chart/table" Criteria: An institution must conduct a physical inventory of equipment and real property at least once every two years with results reconciled with the equipment records (2 CFR section 200.313(d)(2)). Condition/Context: In testing equipment and real property management, we requested from management support for their conduction of a physical inventory of equipment and real property acquired with federal funds. We noted management was unable to produce such records, as a physical inventory of federal equipment and real property had not been conducted within the required two-year period. Cause: There was a lapse in internal controls surrounding monitoring the physical inventory of equipment and real property acquired with federal funds. Effect: The College did not timely conduct their physical inventory of equipment and real property acquired with federal funds within the two-year period. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the College implement a policy to monitor the physical inventory of equipment and real property acquired with federal funds at least once during each two-year period. Views of responsible officials: Management agrees there was a lapse in controls surrounding monitoring the physical inventory of equipment and real property acquired with federal funds. New and revised controls will be implemented to ensure a physical inventory of federally acquired equipment and real property is conducted within the required two-year period. These controls include performing this physical inventory at least annually to ensure the two-year requirement is met.
FINDING 2022-001 ? Equipment and Real Property Management ? Significant Deficiency in Internal Controls and Instance of Non-Compliance "See Schedule of Findings and Questioned Costs for chart/table" Criteria: An institution must conduct a physical inventory of equipment and real property at least once every two years with results reconciled with the equipment records (2 CFR section 200.313(d)(2)). Condition/Context: In testing equipment and real property management, we requested from management support for their conduction of a physical inventory of equipment and real property acquired with federal funds. We noted management was unable to produce such records, as a physical inventory of federal equipment and real property had not been conducted within the required two-year period. Cause: There was a lapse in internal controls surrounding monitoring the physical inventory of equipment and real property acquired with federal funds. Effect: The College did not timely conduct their physical inventory of equipment and real property acquired with federal funds within the two-year period. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the College implement a policy to monitor the physical inventory of equipment and real property acquired with federal funds at least once during each two-year period. Views of responsible officials: Management agrees there was a lapse in controls surrounding monitoring the physical inventory of equipment and real property acquired with federal funds. New and revised controls will be implemented to ensure a physical inventory of federally acquired equipment and real property is conducted within the required two-year period. These controls include performing this physical inventory at least annually to ensure the two-year requirement is met.
FINDING 2022-001 ? Equipment and Real Property Management ? Significant Deficiency in Internal Controls and Instance of Non-Compliance "See Schedule of Findings and Questioned Costs for chart/table" Criteria: An institution must conduct a physical inventory of equipment and real property at least once every two years with results reconciled with the equipment records (2 CFR section 200.313(d)(2)). Condition/Context: In testing equipment and real property management, we requested from management support for their conduction of a physical inventory of equipment and real property acquired with federal funds. We noted management was unable to produce such records, as a physical inventory of federal equipment and real property had not been conducted within the required two-year period. Cause: There was a lapse in internal controls surrounding monitoring the physical inventory of equipment and real property acquired with federal funds. Effect: The College did not timely conduct their physical inventory of equipment and real property acquired with federal funds within the two-year period. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the College implement a policy to monitor the physical inventory of equipment and real property acquired with federal funds at least once during each two-year period. Views of responsible officials: Management agrees there was a lapse in controls surrounding monitoring the physical inventory of equipment and real property acquired with federal funds. New and revised controls will be implemented to ensure a physical inventory of federally acquired equipment and real property is conducted within the required two-year period. These controls include performing this physical inventory at least annually to ensure the two-year requirement is met.