FINDING 2022-003 Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Number: 84.425 Federal Award Number and Year (or Other Identifying Number): S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system 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. During fiscal year 2021-2022, the School Corporation purchased $62,769 of equipment with ESSER III funds which exceeded the School Corporation's capitalization threshold. The equipment was not added to the property record or capital asset listing which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number (FAIN)), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property. The lack of internal controls and noncompliance were isolated to the property record or capital asset listing for 2021-2022. 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)(1) states: "Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property." Cause Management had not developed a system of internal control 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 noncompliance to go undetected. Noncompliance with the grant agreement and the Equipment and Real Property Management compliance requirement could have resulted in the loss of 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 Number: 2022-002 Federal Program: CFDA 14.850 ? Public and Indian Housing Condition: A physical inventory of property and equipment was not performed in order to reconcile it with the general ledger control accounts. The property and equipment subsidiary did not include certain information that is required by the Federal Regulation, as follows: o Serial numbers o Identification and/or tag number o Percentage of federal participation on cost of units o In addition, certain acquisition dates for some of the assets needs to be revised Criteria: 2 CFR 200.313 (d) (1) establishes that property records must be maintained and should include a description of the property, a serial number or other identification number, the source of funding for the property, who holds the title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. Cause: The property and equipment subsidiary was not reviewed in order to ascertain that all required information is properly included. Effects or potential effect: Non inclusion of all applicable information as required by the Federal Regulation. Recommendation: We recommend that management update the property and equipment report with information required by federal government and performed a physical inventory observation to reconciliate the information with general ledger accounts.
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: 84.425C, 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425C200018, S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system was not designed or implemented 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 for various pieces of equipment with Education Stabilization Funds. Although these assets were added to a detailed listing of capital assets, this listing did not include 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, and the use and condition of the property. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.313(d)(1) states: "Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, 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 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 19 KANKAKEE VALLEY SCHOOL CORPORATION 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 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: 84.425C, 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425C200018, S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system was not designed or implemented 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 for various pieces of equipment with Education Stabilization Funds. Although these assets were added to a detailed listing of capital assets, this listing did not include 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, and the use and condition of the property. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.313(d)(1) states: "Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, 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 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 19 KANKAKEE VALLEY SCHOOL CORPORATION 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 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: 84.425C, 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425C200018, S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system was not designed or implemented 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 for various pieces of equipment with Education Stabilization Funds. Although these assets were added to a detailed listing of capital assets, this listing did not include 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, and the use and condition of the property. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.313(d)(1) states: "Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, 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 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 19 KANKAKEE VALLEY SCHOOL CORPORATION 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 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: 84.425C, 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425C200018, S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system was not designed or implemented 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 for various pieces of equipment with Education Stabilization Funds. Although these assets were added to a detailed listing of capital assets, this listing did not include 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, and the use and condition of the property. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.313(d)(1) states: "Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, 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 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 19 KANKAKEE VALLEY SCHOOL CORPORATION 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 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: 84.425C, 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425C200018, S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system was not designed or implemented 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 for various pieces of equipment with Education Stabilization Funds. Although these assets were added to a detailed listing of capital assets, this listing did not include 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, and the use and condition of the property. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.313(d)(1) states: "Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, 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 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 19 KANKAKEE VALLEY SCHOOL CORPORATION 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 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 # 2022-001 U.S. Department of Education ? Passed-through the NYS Education Department COVID-19 Elementary and Secondary School Emergency Relief Fund; Assistance Listing Number 84.425D; Grant Period ? Fiscal Year Ended June 30, 2022 Significant Deficiency Criteria: According to 2 CFR section 200.313(d)(1), detailed property records must be maintained for equipment acquired under a federal grant award. Records should include a description of the property, a serial number or identification number, the source of funding (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 ultimate disposition data. Condition: During our audit, we noted the District?s fixed asset records were incomplete for some of the assets acquired with federal grant funding. Cause: The timing of fixed asset additions to the District?s records did not align with the acquisition date. Effect: If the District?s fixed asset records are incomplete, they may not be properly safeguarded, and the District may not comply with the aforementioned federal regulations. Recommendation: We recommend that the District update their fixed asset records to include required information for assets purchased with federal awards and that a system of communication and a review process be implemented to ensure completeness and timing of fixed asset records. District?s Response: The District?s response is included in their corrective plan.
1. FINDING NUMBER: 2022- 004 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 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 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.
Statement of condition: Property records for equipment acquired under the Education Stabilization Fund program were not maintained. Criteria: Title 2 U.S. Code of Federal Regulations (CFR) 200.313(d)(1) requires that property records 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. Per the School's policies, property records should be maintained for all equipment and theft sensitive assets. Cause of condition: Procedures are in place for property records to be maintained for all equipment acquired during the fiscal year. However, these procedures do not include maintaining all of the information required by 2 CFR 200.313(d)(1). Effects of condition: During testing, it was noted that property records including all required information were not maintained for capital assets acquired under the Education Stabilization Fund program. Context: Property including school buses and various computer equipment and furniture and fixtures was acquired under the Education Stabilization Fund program. The audit testing found that for all property acquired during the fiscal year, records including a description of the property, the acquisition date, and the cost of the property are being maintained. However, the property records do not include various additional information as required by 2 CFR 200.313(d)(1). Recommendation: Procedures should be put in place to ensure that property records including all required information are maintained for all capital assets purchased by the School in accordance with 2 CFR 200.313(d)(1).
Statement of condition: Property records for equipment acquired under the Education Stabilization Fund program were not maintained. Criteria: Title 2 U.S. Code of Federal Regulations (CFR) 200.313(d)(1) requires that property records 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. Per the School's policies, property records should be maintained for all equipment and theft sensitive assets. Cause of condition: Procedures are in place for property records to be maintained for all equipment acquired during the fiscal year. However, these procedures do not include maintaining all of the information required by 2 CFR 200.313(d)(1). Effects of condition: During testing, it was noted that property records including all required information were not maintained for capital assets acquired under the Education Stabilization Fund program. Context: Property including school buses and various computer equipment and furniture and fixtures was acquired under the Education Stabilization Fund program. The audit testing found that for all property acquired during the fiscal year, records including a description of the property, the acquisition date, and the cost of the property are being maintained. However, the property records do not include various additional information as required by 2 CFR 200.313(d)(1). Recommendation: Procedures should be put in place to ensure that property records including all required information are maintained for all capital assets purchased by the School in accordance with 2 CFR 200.313(d)(1).
Statement of condition: Property records for equipment acquired under the Education Stabilization Fund program were not maintained. Criteria: Title 2 U.S. Code of Federal Regulations (CFR) 200.313(d)(1) requires that property records 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. Per the School's policies, property records should be maintained for all equipment and theft sensitive assets. Cause of condition: Procedures are in place for property records to be maintained for all equipment acquired during the fiscal year. However, these procedures do not include maintaining all of the information required by 2 CFR 200.313(d)(1). Effects of condition: During testing, it was noted that property records including all required information were not maintained for capital assets acquired under the Education Stabilization Fund program. Context: Property including school buses and various computer equipment and furniture and fixtures was acquired under the Education Stabilization Fund program. The audit testing found that for all property acquired during the fiscal year, records including a description of the property, the acquisition date, and the cost of the property are being maintained. However, the property records do not include various additional information as required by 2 CFR 200.313(d)(1). Recommendation: Procedures should be put in place to ensure that property records including all required information are maintained for all capital assets purchased by the School in accordance with 2 CFR 200.313(d)(1).
FINDING 2022-003 Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listing Number: 84.425C, 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425C200018, S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context 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 23 EAST WASHINGTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) A property record or capital asset listing which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. The School Corporation purchased one capital asset, a bus, with ESSER II funds of the Education Stabilization Funds. This bus was not included in the School Corporation's capital assets listing. In addition, a physical inventory had not been taken in the past two years and assets were not properly maintained and safeguarded as they were not added to the asset listing. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) . . . ." 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 designed nor implemented a system of internal controls that would have ensured compliance with the grant agreement and the Equipment and Real Property Management compliance requirement. INDIANA STATE BOARD OF ACCOUNTS 24 EAST WASHINGTON SCHOOL CORPORATION 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 resulted in the loss of 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 2022-003 Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listing Number: 84.425C, 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425C200018, S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context 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 23 EAST WASHINGTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) A property record or capital asset listing which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. The School Corporation purchased one capital asset, a bus, with ESSER II funds of the Education Stabilization Funds. This bus was not included in the School Corporation's capital assets listing. In addition, a physical inventory had not been taken in the past two years and assets were not properly maintained and safeguarded as they were not added to the asset listing. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) . . . ." 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 designed nor implemented a system of internal controls that would have ensured compliance with the grant agreement and the Equipment and Real Property Management compliance requirement. INDIANA STATE BOARD OF ACCOUNTS 24 EAST WASHINGTON SCHOOL CORPORATION 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 resulted in the loss of 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 2022-003 Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listing Number: 84.425C, 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425C200018, S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context 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 23 EAST WASHINGTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) A property record or capital asset listing which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. The School Corporation purchased one capital asset, a bus, with ESSER II funds of the Education Stabilization Funds. This bus was not included in the School Corporation's capital assets listing. In addition, a physical inventory had not been taken in the past two years and assets were not properly maintained and safeguarded as they were not added to the asset listing. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) . . . ." 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 designed nor implemented a system of internal controls that would have ensured compliance with the grant agreement and the Equipment and Real Property Management compliance requirement. INDIANA STATE BOARD OF ACCOUNTS 24 EAST WASHINGTON SCHOOL CORPORATION 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 resulted in the loss of 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 2022-003 Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listing Number: 84.425C, 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425C200018, S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context 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 23 EAST WASHINGTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) A property record or capital asset listing which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. The School Corporation purchased one capital asset, a bus, with ESSER II funds of the Education Stabilization Funds. This bus was not included in the School Corporation's capital assets listing. In addition, a physical inventory had not been taken in the past two years and assets were not properly maintained and safeguarded as they were not added to the asset listing. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) . . . ." 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 designed nor implemented a system of internal controls that would have ensured compliance with the grant agreement and the Equipment and Real Property Management compliance requirement. INDIANA STATE BOARD OF ACCOUNTS 24 EAST WASHINGTON SCHOOL CORPORATION 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 resulted in the loss of 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 2022-003 Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listing Number: 84.425C, 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425C200018, S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context 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 23 EAST WASHINGTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) A property record or capital asset listing which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. The School Corporation purchased one capital asset, a bus, with ESSER II funds of the Education Stabilization Funds. This bus was not included in the School Corporation's capital assets listing. In addition, a physical inventory had not been taken in the past two years and assets were not properly maintained and safeguarded as they were not added to the asset listing. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) . . . ." 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 designed nor implemented a system of internal controls that would have ensured compliance with the grant agreement and the Equipment and Real Property Management compliance requirement. INDIANA STATE BOARD OF ACCOUNTS 24 EAST WASHINGTON SCHOOL CORPORATION 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 resulted in the loss of 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 2022-003 Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listing Number: 84.425C, 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425C200018, S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context 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 23 EAST WASHINGTON SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) A property record or capital asset listing which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. The School Corporation purchased one capital asset, a bus, with ESSER II funds of the Education Stabilization Funds. This bus was not included in the School Corporation's capital assets listing. In addition, a physical inventory had not been taken in the past two years and assets were not properly maintained and safeguarded as they were not added to the asset listing. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) . . . ." 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 designed nor implemented a system of internal controls that would have ensured compliance with the grant agreement and the Equipment and Real Property Management compliance requirement. INDIANA STATE BOARD OF ACCOUNTS 24 EAST WASHINGTON SCHOOL CORPORATION 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 resulted in the loss of 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 2022-015 Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system was not designed nor implemented at the School Corporation to ensure compliance with the requirements related to the grant agreement and the Equipment and Real Property Management compliance requirement. The School Corporation purchased playground equipment for their elementary schools with Education Stabilization Funds. Sleepy Hollow Play System $7,600, Merriment - Wood $12,548, Sweet Tooth Play System $9,373, and Richardson Play System $9,192 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 the funding for the property (including the federal award identification number (FAIN)), who holds the 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. 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: INDIANA STATE BOARD OF ACCOUNTS 56 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (1) Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. . . . (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 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 have resulted in the loss of 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 2022-015 Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system was not designed nor implemented at the School Corporation to ensure compliance with the requirements related to the grant agreement and the Equipment and Real Property Management compliance requirement. The School Corporation purchased playground equipment for their elementary schools with Education Stabilization Funds. Sleepy Hollow Play System $7,600, Merriment - Wood $12,548, Sweet Tooth Play System $9,373, and Richardson Play System $9,192 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 the funding for the property (including the federal award identification number (FAIN)), who holds the 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. 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: INDIANA STATE BOARD OF ACCOUNTS 56 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (1) Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. . . . (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 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 have resulted in the loss of 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 2022-015 Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system was not designed nor implemented at the School Corporation to ensure compliance with the requirements related to the grant agreement and the Equipment and Real Property Management compliance requirement. The School Corporation purchased playground equipment for their elementary schools with Education Stabilization Funds. Sleepy Hollow Play System $7,600, Merriment - Wood $12,548, Sweet Tooth Play System $9,373, and Richardson Play System $9,192 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 the funding for the property (including the federal award identification number (FAIN)), who holds the 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. 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: INDIANA STATE BOARD OF ACCOUNTS 56 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (1) Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. . . . (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 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 have resulted in the loss of 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 2022-015 Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system was not designed nor implemented at the School Corporation to ensure compliance with the requirements related to the grant agreement and the Equipment and Real Property Management compliance requirement. The School Corporation purchased playground equipment for their elementary schools with Education Stabilization Funds. Sleepy Hollow Play System $7,600, Merriment - Wood $12,548, Sweet Tooth Play System $9,373, and Richardson Play System $9,192 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 the funding for the property (including the federal award identification number (FAIN)), who holds the 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. 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: INDIANA STATE BOARD OF ACCOUNTS 56 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (1) Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. . . . (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 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 have resulted in the loss of 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.
2022-002 Equipment and Real Property Maintenance ? Education Stabilization Fund CFDA No. 84.425 Criteria: The Uniform Guidance requires non-federal entities other than states to develop a control system to ensure adequate safeguards to prevent loss, damage, or theft of property in accordance with 2 CFR Section 200.313 (d) (3). Condition: We inquired of District personnel regarding the procedures in place, specifically for inventorying and safe guarding of real property and equipment. The procedures put into place after the previous audit were not being followed after the change in personnel in the IT Department. Cause: The lack of procedures for safeguarding equipment caused the District to not be in compliance with 2 CFR Section 200.3 (d) (3) of the Uniform Guidance. Effect: Internal Controls are not functioning as designed and the District is not in compliance with equipment and real property management requirements of the program. Recommendation: The District has developed a specific set of procedures to ensure the proper inventorying and safeguarding of real property and equipment. We recommend the District adhere to these procedures, and have written policies in place to ensure this is not overlooked in the event of changes in personnel. Views of Responsible Officials and Planned Corrective Actions: We agree with the finding and have established written policies and procedures. The District has subsequently identified and maintained these assets to comply with federal property records. Now that the District has written policies in place, this should not occur again.
SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE ? PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION ? COVID-19 ? EDUCATION STABILIZATION FUND (FEDERAL ALN 84.425) 2022-002 Internal Controls Over Compliance With Equipment and Real Property Management Criteria ? 2 CFR ? 200.313(d)(1) requires the Academy to designate fixed assets purchased under federal programs and to maintain related property records, including a description of the property, a serial number or other unique identification number, the source of funding for the property (including the federal Assistance Listing 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 sale price of the property. Condition ? During our audit, we noted that the Academy did not have sufficient controls in place within the Education Stabilization Fund federal program to specifically identify federally-funded fixed assets and maintain the required records as noted above to assure compliance with federal equipment and real property management requirements. Questioned Costs ? None. Our testing did not indicate any instances of noncompliance. Context ? A population of one applicable fixed asset purchased with federal awards was noted during the course of our audit. This was not a statistically valid sample. Repeat Finding ? This is a current year finding only. Cause ? The Academy did not did not have a system in place for specifically identifying federally-funded fixed assets and maintaining the required records as noted above. Effect ? This could be viewed as a violation of the award agreement. Recommendation ? We recommend that the Academy review its internal control procedures to ensure future compliance with the federal compliance requirements specific to equipment and real property management for the Education Stabilization Fund federal program. View of Responsible Official and Planned Corrective Actions ? The Academy agrees with the finding. The Academy intends to review its control procedures relating to equipment and real property management requirements to ensure compliance for future federal awards expenditures. The Academy has separately issued a Corrective Action Plan related to this finding.
SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE ? PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION ? COVID-19 ? EDUCATION STABILIZATION FUND (FEDERAL ALN 84.425) 2022-002 Internal Controls Over Compliance With Equipment and Real Property Management Criteria ? 2 CFR ? 200.313(d)(1) requires the Academy to designate fixed assets purchased under federal programs and to maintain related property records, including a description of the property, a serial number or other unique identification number, the source of funding for the property (including the federal Assistance Listing 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 sale price of the property. Condition ? During our audit, we noted that the Academy did not have sufficient controls in place within the Education Stabilization Fund federal program to specifically identify federally-funded fixed assets and maintain the required records as noted above to assure compliance with federal equipment and real property management requirements. Questioned Costs ? None. Our testing did not indicate any instances of noncompliance. Context ? A population of one applicable fixed asset purchased with federal awards was noted during the course of our audit. This was not a statistically valid sample. Repeat Finding ? This is a current year finding only. Cause ? The Academy did not did not have a system in place for specifically identifying federally-funded fixed assets and maintaining the required records as noted above. Effect ? This could be viewed as a violation of the award agreement. Recommendation ? We recommend that the Academy review its internal control procedures to ensure future compliance with the federal compliance requirements specific to equipment and real property management for the Education Stabilization Fund federal program. View of Responsible Official and Planned Corrective Actions ? The Academy agrees with the finding. The Academy intends to review its control procedures relating to equipment and real property management requirements to ensure compliance for future federal awards expenditures. The Academy has separately issued a Corrective Action Plan related to this finding.
2022-002 Department of Health and Human Services Federal Financial Assistance Listing #93.889, 22SC091990 National Bioterrorism Hospital Preparedness Program Equipment and Real Property Management Material Weakness in Internal Control over Compliance Criteria: 2CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. 2 CFR 200.313(d)(1) requires 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 CFR 200.313(d)(2) requires a physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. Condition: The following matters were identified during testing: a) No independent secondary level of review or approval is performed. One employee is involved in preparing, reviewing and approving information. Additionally, internal control procedures documented within Coalition?s Grant Management Policy have not been updated since departure of the Grant Management Director. b) Property records lack descriptive elements as required by 2 CFR 200.313(d)(1), including source of funding, acquisition date and cost. c) A physical inventory of equipment has not been performed within the last two years. Cause: The Coalition hasn?t formally adopted and implemented updated internal control procedures since departure of the Grant Management Director. Additionally, the Coalition was unaware of federal requirements pertaining to the descriptive elements of property records required and the completion of a physical inventory of property every two years. Effect: Without established controls over equipment and real property management, there is risk that equipment could be misappropriated, unallowable equipment purchases could be charged to the federal award and an increased risk federal agency wouldn?t be reimbursed if federal-funded equipment was disposed of. Questioned Costs: None reported. Context: There were three fixed asset purchases charged to the federal award within the fiscal year of which all were tested. Repeat Finding from Prior Year: No Recommendation: We recommend that management implement procedures and control processes to incorporate and document an independent review and approval over equipment compliance requirements, comply with property record requirements, and perform a bi-annual physical inventory of the equipment. Views of Responsible Officials: Management agrees with the finding.
2022-003 Equipment and Property Management US Department of Education Passed Through NYS Education Dept. Education Stabilization Fund COVID 19 ARP ESSER 3 AL 84.425U COVID 19 CRRSA ESSER 2 AL 84.425D Criteria: 2CFR Section 200.313(d)(1) specifies detailed property records that must be maintained for equipment acquired under a federal grant award. Records include a description of the property, a serial number or identification number, the source of funding (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. Condition: The District expended funds from the ARP ESSER 3 grant to acquire promethean boards and other technology equipment and to make various land improvements such as outdoor classrooms and a basketball court. The District expended funds from the CRRSA ESSER 2 grant to acquire desks and seating. District fixed asset records did not include the detailed information required by 2CFR Section 200.313(d)(1). Some of the assets were not on the District?s fixed asset records at all and some were included in the fixed asset records but required information was missing. Context: The audit identified approximately $350,000 of assets, consisting primarily of outdoor spaces and playground matting purchased with ESSER3 funds that were not on the fixed asset schedule. Approximately $147,000 of desks and seating purchased with ESSER 2 funds were not on the fixed asset schedule. Other assets purchased with ESSER 3 funds of approximately $1.25 million were on the fixed asset schedule but all the required information was not included. Effect: If assets are not on the District?s fixed asset records, they may not be properly safeguarded, and the District may not comply with the Federal disposal rules. Cause: The Federal government awarded new types of grant funding in response to the COVID 19 pandemic. This funding presented difficulties for recipients because of the uncertainties related to the pandemic and the changing guidance and funding levels. The District has typically not used Federal grant funds to acquire fixed assets. There was inadequate communication between the departments regarding grant purchases and no system in place to ensure that all assets were included in the fixed asset records. There was also confusion regarding the District?s capitalization policy. Some items were individually under the capitalization threshold but because they were purchased in bulk the entire purchase was over the threshold. Recommendation: We recommend that the District update their fixed asset records to include the required information for assets purchased with Federal awards. A system of communication and a review process should be implemented to ensure completeness of fixed asset records. Personnel should become familiar with the Federal regulations concerning asset purchases.
2022-003 Equipment and Property Management US Department of Education Passed Through NYS Education Dept. Education Stabilization Fund COVID 19 ARP ESSER 3 AL 84.425U COVID 19 CRRSA ESSER 2 AL 84.425D Criteria: 2CFR Section 200.313(d)(1) specifies detailed property records that must be maintained for equipment acquired under a federal grant award. Records include a description of the property, a serial number or identification number, the source of funding (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. Condition: The District expended funds from the ARP ESSER 3 grant to acquire promethean boards and other technology equipment and to make various land improvements such as outdoor classrooms and a basketball court. The District expended funds from the CRRSA ESSER 2 grant to acquire desks and seating. District fixed asset records did not include the detailed information required by 2CFR Section 200.313(d)(1). Some of the assets were not on the District?s fixed asset records at all and some were included in the fixed asset records but required information was missing. Context: The audit identified approximately $350,000 of assets, consisting primarily of outdoor spaces and playground matting purchased with ESSER3 funds that were not on the fixed asset schedule. Approximately $147,000 of desks and seating purchased with ESSER 2 funds were not on the fixed asset schedule. Other assets purchased with ESSER 3 funds of approximately $1.25 million were on the fixed asset schedule but all the required information was not included. Effect: If assets are not on the District?s fixed asset records, they may not be properly safeguarded, and the District may not comply with the Federal disposal rules. Cause: The Federal government awarded new types of grant funding in response to the COVID 19 pandemic. This funding presented difficulties for recipients because of the uncertainties related to the pandemic and the changing guidance and funding levels. The District has typically not used Federal grant funds to acquire fixed assets. There was inadequate communication between the departments regarding grant purchases and no system in place to ensure that all assets were included in the fixed asset records. There was also confusion regarding the District?s capitalization policy. Some items were individually under the capitalization threshold but because they were purchased in bulk the entire purchase was over the threshold. Recommendation: We recommend that the District update their fixed asset records to include the required information for assets purchased with Federal awards. A system of communication and a review process should be implemented to ensure completeness of fixed asset records. Personnel should become familiar with the Federal regulations concerning asset purchases.
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 & DE 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 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.
U.S. DEPARTMENT OF EDUCATION Significant Deficiency 2022-01: Education and Secondary School Emergency Relief Fund ? CFDA #84.425D and #84.425U Grant Period: Year Ended June 30, 2022 Condition and Context: The District purchased equipment greater than the Uniform Guidance capitalization threshold and failed to complete a listing of equipment containing all pertinent data. The lack of compliance did not result in any material noncompliance, fraud, or abuse with respect to the major program. Criteria: The Uniform Guidance requires entities to follow equipment procedures set out at 2 CFR sections 200.313(c) through (e) and real property procedures set out at 2 CFR section 200.311(b). Entities must retain a listing of equipment greater than or equal to the capitalization policy of either the entity or Uniform Guidance with relevant data including, a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award 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, a and any ultimate disposition data including the date of disposal and sales price of the property. Property records must be maintained and include the name, part number and description, and other elements as necessary and required in accordance with the terms and conditions of the contract, quantity received, unit acquisition cost, unique-item identifier, accountable contract number, location, disposition, and posting reference and date of transaction. Cause: The District was unaware of the requirements set out by Uniform Guidance. Effect: An important component of equipment policies is retaining information to ensure that the award is used for authorized purposes, complies with the terms and conditions of the award, and achieves performance goals. Without equipment policies, there is a higher risk of noncompliance with program requirements. Recommendation: Management should determine procedures for equipment purchases and apply them to all equipment purchases equal to or exceeding the threshold to comply with the Uniform Guidance. Grantee Response: Management agrees with the finding and recommendation. The District will establish policies and procedures for future grant awards to comply with Uniform Guidance requirements.
Finding 2022-065 Research and Development Cluster Equipment Management Compliance The federal government sponsors Research and Development (R&D) activities under a variety of types of awards, most commonly grants, cooperative agreements, and contracts, to achieve objectives agreed upon between the federal awarding agency and the non-federal entity. The types of R&D activities conducted under these awards vary greatly. The objective of an individual project is explained in the federal award document. R&D activities at the University are subject to federal equipment management requirements. In accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 201.1 Definitions, equipment is defined as tangible personal property (including information technology systems) having a useful life of more than one year and a per-unit acquisition cost which equals or exceeds the lesser of the capitalization level established by the non-Federal entity for financial statement purposes, or $5,000. The University uses equipment to meet the objective of its various research projects and this equipment may be common items such as a microscope or very complex scientific equipment, Under federal regulations, the University is required, for any equipment purchased under a federal contract, to maintain and track the equipment as to its location. The University must have an internal control structure in place in order to protect and safeguard the equipment and the University should be able to provide evidence that the equipment is safeguarded and maintained and show the location of all equipment. The Campus Controller?s Property Accounting Office (PAO) within the Boulder campus is responsible for equipment and property management. The PAO sends its full equipment listing quarterly to a portion of its individual departments with equipment, in a frequency to cover all departments within a two-year period. The individual departments are required to review the equipment listing, add any new equipment to the listing, and remove any equipment from the listing that has been disposed of or is no longer in service. Once the departments return the listings to the PAO, the PAO selects a sample to verify the information provided by the departments. The PAO selects the sample and the PAO Property Accountant then verifies the equipment?s existence by performing a site visit to the department and observing the equipment. The PAO selects a new sample each quarter. During Fiscal Year 2022, the University?s three campuses in total expended approximately $916 million in R&D grant funds: $504 million, $406 million and $6 million from the Boulder, Denver and UCCS campuses, respectively. Of that amount, the University?s three campuses expended a total of approximately $191 million for equipment purchases, with $116 million, $69.6 million, and $5.4 million being spent by the Boulder, Denver, and UCCS campuses, respectively. What was the purpose of our audit work and what work was performed? The purpose of the audit work was to determine whether the University?s campuses had adequate internal controls in place over, and complied with, the R&D Cluster?s equipment management requirements for Fiscal Year 2022. As part of our audit work, we tested the University?s campuses? internal controls related to the R&D equipment management requirements. We tested 60 items of equipment with a total value of $1.2 million to determine whether the University appropriately safeguarded and maintained equipment, as required by federal regulations. In addition, we tested 40 of the 60 items of equipment with a total value of $840,000 to determine whether the University?s campuses appropriately placed property tags on the equipment as required by University policy. How were the results of the audit work measured? We measured the results of our audit work against the following requirements: ? Federal regulation 2 CFR 200.313(b) states that a State must use, manage and dispose of equipment acquired under a federal award to the State in accordance with the state laws and procedures. The University?s Property Control Manual section 1.3 states that the University is responsible and accountable for all property acquired with federal funding in accordance with federal regulations and the provision of a sponsored award. While under the heading of ?non-federal entities other than States,? federal regulation 2 CFR 200.313(c) through (e) also requires that equipment records be maintained, a physical inventory of equipment be taken at least once every two years and reconciled to the equipment record, an appropriate control system be used to safeguard equipment and all equipment shall be adequately maintained. ? The University?s Property Control Manual Section 3.3.1 states that ?only items having an acquisition cost of $5,000 or more are logged and tracked in the university property record.? Furthermore, the University?s Property Control Manual Section 3.3.3, states that equipment records should be updated for any changes discovered during the performance of an inventory over equipment. This would include equipment that should be removed from the listing because it was disposed of or is no longer in service. ? The University?s Property Control Manual section 3.2 states that ?All Government property at $5,000 or above in the custody of the Boulder campus must be tagged.? What problems did the audit work identify? We found that 2 of the 60 equipment items that we tested (3 percent,) with a total value of $39,400, were inappropriately included on the equipment listing even though they had either been disposed of in a prior period or were not in service. Specifically, one equipment item with an approximate value of $28,000 was no longer in service by the University, but still remained on the University?s inventory listing. The second equipment item with an approximate value of $8,400 was disposed of by the University on October 3, 2017, but was still on the list. In addition, we determined that 2 of the 40 equipment items we tested for tagging (5 percent) did not contain the tag as required by the University?s Property Control Manual. One of these items was valued at approximately $28,000. The second item was valued at approximately $31,000. Why did these problems occur? The University?s Boulder campus did not have adequate internal controls in place to ensure it complied with the R&D equipment management requirements. Specifically, although the University does have policies over equipment, Boulder campus staff were not adequately performing the procedures intrinsic in the policy. Specifically, neither the PAO nor the individual University departments adequately reconciled the equipment listing to the physical equipment on hand, which resulted in the list including equipment that had been disposed of or was no longer in use. Additionally, the Boulder Campus did not follow its own policies and procedures requiring that equipment with a value of $5,000 was appropriately tagged. One item?s tag was missing and a replacement tag had been ordered and not received at the time of our procedures. We could not determine whether the University identified that the tag was missing before we requested the information for review. The second item was below ground and the University did not maintain evidence of the original tag. Why do these problems matter? The University is obligated to adhere to specified requirements as outlined by federal regulations and the respective award agreement. By failing to adhere to the requirements for maintenance of equipment, the University potentially risks repercussions from the awarding agency. Furthermore, failing to properly maintain the equipment in accordance with federal and University requirements could increase the risk of theft or loss and decrease the ability of the University to adequately identify theft or loss. See Schedule of Findings and Questioned Costs for chart/table Recommendation 2022-065 The University of Colorado?s Boulder campus should strengthen its internal controls over equipment management and ensure that it complies with the Research and Development equipment management federal compliance requirements by: A. Ensuring the Campus Controller?s Property Accounting Office and the individual departments adequately reconcile the equipment listing to the physical equipment on hand to ensure that the list is accurate, and remove equipment from the listing that has been disposed of or is no longer in use. B. Enforcing its current policies and procedures for ensuring all equipment is appropriately tagged and maintained. Response University of Colorado A. Agree Implementation Date: March 2023 Management agrees with the recommendation. Procedures have been initiated with cross campus partners and will be fully implemented by March 2023. The proposed corrective action plan is as follows: ? Escalation procedures will be implemented in collaboration with campus partners so that action items identified in inventory reviews are addressed timely. ? The Campus Controller?s Office will work with campus partners to increase physical monitoring procedures to ensure tags are affixed and maintained on equipment. B. Agree Implementation Date: March 2023 Management agrees with the recommendation. Procedures have been initiated with cross campus partners and will be fully implemented by March 2023. The proposed corrective action plan is as follows: ? Escalation procedures will be implemented in collaboration with campus partners so that action items identified in inventory reviews are addressed timely. ? The Campus Controller?s Office will work with campus partners to increase physical monitoring procedures to ensure tags are affixed and maintained on equipment.
Finding 2022-065 Research and Development Cluster Equipment Management Compliance The federal government sponsors Research and Development (R&D) activities under a variety of types of awards, most commonly grants, cooperative agreements, and contracts, to achieve objectives agreed upon between the federal awarding agency and the non-federal entity. The types of R&D activities conducted under these awards vary greatly. The objective of an individual project is explained in the federal award document. R&D activities at the University are subject to federal equipment management requirements. In accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 201.1 Definitions, equipment is defined as tangible personal property (including information technology systems) having a useful life of more than one year and a per-unit acquisition cost which equals or exceeds the lesser of the capitalization level established by the non-Federal entity for financial statement purposes, or $5,000. The University uses equipment to meet the objective of its various research projects and this equipment may be common items such as a microscope or very complex scientific equipment, Under federal regulations, the University is required, for any equipment purchased under a federal contract, to maintain and track the equipment as to its location. The University must have an internal control structure in place in order to protect and safeguard the equipment and the University should be able to provide evidence that the equipment is safeguarded and maintained and show the location of all equipment. The Campus Controller?s Property Accounting Office (PAO) within the Boulder campus is responsible for equipment and property management. The PAO sends its full equipment listing quarterly to a portion of its individual departments with equipment, in a frequency to cover all departments within a two-year period. The individual departments are required to review the equipment listing, add any new equipment to the listing, and remove any equipment from the listing that has been disposed of or is no longer in service. Once the departments return the listings to the PAO, the PAO selects a sample to verify the information provided by the departments. The PAO selects the sample and the PAO Property Accountant then verifies the equipment?s existence by performing a site visit to the department and observing the equipment. The PAO selects a new sample each quarter. During Fiscal Year 2022, the University?s three campuses in total expended approximately $916 million in R&D grant funds: $504 million, $406 million and $6 million from the Boulder, Denver and UCCS campuses, respectively. Of that amount, the University?s three campuses expended a total of approximately $191 million for equipment purchases, with $116 million, $69.6 million, and $5.4 million being spent by the Boulder, Denver, and UCCS campuses, respectively. What was the purpose of our audit work and what work was performed? The purpose of the audit work was to determine whether the University?s campuses had adequate internal controls in place over, and complied with, the R&D Cluster?s equipment management requirements for Fiscal Year 2022. As part of our audit work, we tested the University?s campuses? internal controls related to the R&D equipment management requirements. We tested 60 items of equipment with a total value of $1.2 million to determine whether the University appropriately safeguarded and maintained equipment, as required by federal regulations. In addition, we tested 40 of the 60 items of equipment with a total value of $840,000 to determine whether the University?s campuses appropriately placed property tags on the equipment as required by University policy. How were the results of the audit work measured? We measured the results of our audit work against the following requirements: ? Federal regulation 2 CFR 200.313(b) states that a State must use, manage and dispose of equipment acquired under a federal award to the State in accordance with the state laws and procedures. The University?s Property Control Manual section 1.3 states that the University is responsible and accountable for all property acquired with federal funding in accordance with federal regulations and the provision of a sponsored award. While under the heading of ?non-federal entities other than States,? federal regulation 2 CFR 200.313(c) through (e) also requires that equipment records be maintained, a physical inventory of equipment be taken at least once every two years and reconciled to the equipment record, an appropriate control system be used to safeguard equipment and all equipment shall be adequately maintained. ? The University?s Property Control Manual Section 3.3.1 states that ?only items having an acquisition cost of $5,000 or more are logged and tracked in the university property record.? Furthermore, the University?s Property Control Manual Section 3.3.3, states that equipment records should be updated for any changes discovered during the performance of an inventory over equipment. This would include equipment that should be removed from the listing because it was disposed of or is no longer in service. ? The University?s Property Control Manual section 3.2 states that ?All Government property at $5,000 or above in the custody of the Boulder campus must be tagged.? What problems did the audit work identify? We found that 2 of the 60 equipment items that we tested (3 percent,) with a total value of $39,400, were inappropriately included on the equipment listing even though they had either been disposed of in a prior period or were not in service. Specifically, one equipment item with an approximate value of $28,000 was no longer in service by the University, but still remained on the University?s inventory listing. The second equipment item with an approximate value of $8,400 was disposed of by the University on October 3, 2017, but was still on the list. In addition, we determined that 2 of the 40 equipment items we tested for tagging (5 percent) did not contain the tag as required by the University?s Property Control Manual. One of these items was valued at approximately $28,000. The second item was valued at approximately $31,000. Why did these problems occur? The University?s Boulder campus did not have adequate internal controls in place to ensure it complied with the R&D equipment management requirements. Specifically, although the University does have policies over equipment, Boulder campus staff were not adequately performing the procedures intrinsic in the policy. Specifically, neither the PAO nor the individual University departments adequately reconciled the equipment listing to the physical equipment on hand, which resulted in the list including equipment that had been disposed of or was no longer in use. Additionally, the Boulder Campus did not follow its own policies and procedures requiring that equipment with a value of $5,000 was appropriately tagged. One item?s tag was missing and a replacement tag had been ordered and not received at the time of our procedures. We could not determine whether the University identified that the tag was missing before we requested the information for review. The second item was below ground and the University did not maintain evidence of the original tag. Why do these problems matter? The University is obligated to adhere to specified requirements as outlined by federal regulations and the respective award agreement. By failing to adhere to the requirements for maintenance of equipment, the University potentially risks repercussions from the awarding agency. Furthermore, failing to properly maintain the equipment in accordance with federal and University requirements could increase the risk of theft or loss and decrease the ability of the University to adequately identify theft or loss. See Schedule of Findings and Questioned Costs for chart/table Recommendation 2022-065 The University of Colorado?s Boulder campus should strengthen its internal controls over equipment management and ensure that it complies with the Research and Development equipment management federal compliance requirements by: A. Ensuring the Campus Controller?s Property Accounting Office and the individual departments adequately reconcile the equipment listing to the physical equipment on hand to ensure that the list is accurate, and remove equipment from the listing that has been disposed of or is no longer in use. B. Enforcing its current policies and procedures for ensuring all equipment is appropriately tagged and maintained. Response University of Colorado A. Agree Implementation Date: March 2023 Management agrees with the recommendation. Procedures have been initiated with cross campus partners and will be fully implemented by March 2023. The proposed corrective action plan is as follows: ? Escalation procedures will be implemented in collaboration with campus partners so that action items identified in inventory reviews are addressed timely. ? The Campus Controller?s Office will work with campus partners to increase physical monitoring procedures to ensure tags are affixed and maintained on equipment. B. Agree Implementation Date: March 2023 Management agrees with the recommendation. Procedures have been initiated with cross campus partners and will be fully implemented by March 2023. The proposed corrective action plan is as follows: ? Escalation procedures will be implemented in collaboration with campus partners so that action items identified in inventory reviews are addressed timely. ? The Campus Controller?s Office will work with campus partners to increase physical monitoring procedures to ensure tags are affixed and maintained on equipment.
Finding 2022-065 Research and Development Cluster Equipment Management Compliance The federal government sponsors Research and Development (R&D) activities under a variety of types of awards, most commonly grants, cooperative agreements, and contracts, to achieve objectives agreed upon between the federal awarding agency and the non-federal entity. The types of R&D activities conducted under these awards vary greatly. The objective of an individual project is explained in the federal award document. R&D activities at the University are subject to federal equipment management requirements. In accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 201.1 Definitions, equipment is defined as tangible personal property (including information technology systems) having a useful life of more than one year and a per-unit acquisition cost which equals or exceeds the lesser of the capitalization level established by the non-Federal entity for financial statement purposes, or $5,000. The University uses equipment to meet the objective of its various research projects and this equipment may be common items such as a microscope or very complex scientific equipment, Under federal regulations, the University is required, for any equipment purchased under a federal contract, to maintain and track the equipment as to its location. The University must have an internal control structure in place in order to protect and safeguard the equipment and the University should be able to provide evidence that the equipment is safeguarded and maintained and show the location of all equipment. The Campus Controller?s Property Accounting Office (PAO) within the Boulder campus is responsible for equipment and property management. The PAO sends its full equipment listing quarterly to a portion of its individual departments with equipment, in a frequency to cover all departments within a two-year period. The individual departments are required to review the equipment listing, add any new equipment to the listing, and remove any equipment from the listing that has been disposed of or is no longer in service. Once the departments return the listings to the PAO, the PAO selects a sample to verify the information provided by the departments. The PAO selects the sample and the PAO Property Accountant then verifies the equipment?s existence by performing a site visit to the department and observing the equipment. The PAO selects a new sample each quarter. During Fiscal Year 2022, the University?s three campuses in total expended approximately $916 million in R&D grant funds: $504 million, $406 million and $6 million from the Boulder, Denver and UCCS campuses, respectively. Of that amount, the University?s three campuses expended a total of approximately $191 million for equipment purchases, with $116 million, $69.6 million, and $5.4 million being spent by the Boulder, Denver, and UCCS campuses, respectively. What was the purpose of our audit work and what work was performed? The purpose of the audit work was to determine whether the University?s campuses had adequate internal controls in place over, and complied with, the R&D Cluster?s equipment management requirements for Fiscal Year 2022. As part of our audit work, we tested the University?s campuses? internal controls related to the R&D equipment management requirements. We tested 60 items of equipment with a total value of $1.2 million to determine whether the University appropriately safeguarded and maintained equipment, as required by federal regulations. In addition, we tested 40 of the 60 items of equipment with a total value of $840,000 to determine whether the University?s campuses appropriately placed property tags on the equipment as required by University policy. How were the results of the audit work measured? We measured the results of our audit work against the following requirements: ? Federal regulation 2 CFR 200.313(b) states that a State must use, manage and dispose of equipment acquired under a federal award to the State in accordance with the state laws and procedures. The University?s Property Control Manual section 1.3 states that the University is responsible and accountable for all property acquired with federal funding in accordance with federal regulations and the provision of a sponsored award. While under the heading of ?non-federal entities other than States,? federal regulation 2 CFR 200.313(c) through (e) also requires that equipment records be maintained, a physical inventory of equipment be taken at least once every two years and reconciled to the equipment record, an appropriate control system be used to safeguard equipment and all equipment shall be adequately maintained. ? The University?s Property Control Manual Section 3.3.1 states that ?only items having an acquisition cost of $5,000 or more are logged and tracked in the university property record.? Furthermore, the University?s Property Control Manual Section 3.3.3, states that equipment records should be updated for any changes discovered during the performance of an inventory over equipment. This would include equipment that should be removed from the listing because it was disposed of or is no longer in service. ? The University?s Property Control Manual section 3.2 states that ?All Government property at $5,000 or above in the custody of the Boulder campus must be tagged.? What problems did the audit work identify? We found that 2 of the 60 equipment items that we tested (3 percent,) with a total value of $39,400, were inappropriately included on the equipment listing even though they had either been disposed of in a prior period or were not in service. Specifically, one equipment item with an approximate value of $28,000 was no longer in service by the University, but still remained on the University?s inventory listing. The second equipment item with an approximate value of $8,400 was disposed of by the University on October 3, 2017, but was still on the list. In addition, we determined that 2 of the 40 equipment items we tested for tagging (5 percent) did not contain the tag as required by the University?s Property Control Manual. One of these items was valued at approximately $28,000. The second item was valued at approximately $31,000. Why did these problems occur? The University?s Boulder campus did not have adequate internal controls in place to ensure it complied with the R&D equipment management requirements. Specifically, although the University does have policies over equipment, Boulder campus staff were not adequately performing the procedures intrinsic in the policy. Specifically, neither the PAO nor the individual University departments adequately reconciled the equipment listing to the physical equipment on hand, which resulted in the list including equipment that had been disposed of or was no longer in use. Additionally, the Boulder Campus did not follow its own policies and procedures requiring that equipment with a value of $5,000 was appropriately tagged. One item?s tag was missing and a replacement tag had been ordered and not received at the time of our procedures. We could not determine whether the University identified that the tag was missing before we requested the information for review. The second item was below ground and the University did not maintain evidence of the original tag. Why do these problems matter? The University is obligated to adhere to specified requirements as outlined by federal regulations and the respective award agreement. By failing to adhere to the requirements for maintenance of equipment, the University potentially risks repercussions from the awarding agency. Furthermore, failing to properly maintain the equipment in accordance with federal and University requirements could increase the risk of theft or loss and decrease the ability of the University to adequately identify theft or loss. See Schedule of Findings and Questioned Costs for chart/table Recommendation 2022-065 The University of Colorado?s Boulder campus should strengthen its internal controls over equipment management and ensure that it complies with the Research and Development equipment management federal compliance requirements by: A. Ensuring the Campus Controller?s Property Accounting Office and the individual departments adequately reconcile the equipment listing to the physical equipment on hand to ensure that the list is accurate, and remove equipment from the listing that has been disposed of or is no longer in use. B. Enforcing its current policies and procedures for ensuring all equipment is appropriately tagged and maintained. Response University of Colorado A. Agree Implementation Date: March 2023 Management agrees with the recommendation. Procedures have been initiated with cross campus partners and will be fully implemented by March 2023. The proposed corrective action plan is as follows: ? Escalation procedures will be implemented in collaboration with campus partners so that action items identified in inventory reviews are addressed timely. ? The Campus Controller?s Office will work with campus partners to increase physical monitoring procedures to ensure tags are affixed and maintained on equipment. B. Agree Implementation Date: March 2023 Management agrees with the recommendation. Procedures have been initiated with cross campus partners and will be fully implemented by March 2023. The proposed corrective action plan is as follows: ? Escalation procedures will be implemented in collaboration with campus partners so that action items identified in inventory reviews are addressed timely. ? The Campus Controller?s Office will work with campus partners to increase physical monitoring procedures to ensure tags are affixed and maintained on equipment.
Finding 2022-065 Research and Development Cluster Equipment Management Compliance The federal government sponsors Research and Development (R&D) activities under a variety of types of awards, most commonly grants, cooperative agreements, and contracts, to achieve objectives agreed upon between the federal awarding agency and the non-federal entity. The types of R&D activities conducted under these awards vary greatly. The objective of an individual project is explained in the federal award document. R&D activities at the University are subject to federal equipment management requirements. In accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 201.1 Definitions, equipment is defined as tangible personal property (including information technology systems) having a useful life of more than one year and a per-unit acquisition cost which equals or exceeds the lesser of the capitalization level established by the non-Federal entity for financial statement purposes, or $5,000. The University uses equipment to meet the objective of its various research projects and this equipment may be common items such as a microscope or very complex scientific equipment, Under federal regulations, the University is required, for any equipment purchased under a federal contract, to maintain and track the equipment as to its location. The University must have an internal control structure in place in order to protect and safeguard the equipment and the University should be able to provide evidence that the equipment is safeguarded and maintained and show the location of all equipment. The Campus Controller?s Property Accounting Office (PAO) within the Boulder campus is responsible for equipment and property management. The PAO sends its full equipment listing quarterly to a portion of its individual departments with equipment, in a frequency to cover all departments within a two-year period. The individual departments are required to review the equipment listing, add any new equipment to the listing, and remove any equipment from the listing that has been disposed of or is no longer in service. Once the departments return the listings to the PAO, the PAO selects a sample to verify the information provided by the departments. The PAO selects the sample and the PAO Property Accountant then verifies the equipment?s existence by performing a site visit to the department and observing the equipment. The PAO selects a new sample each quarter. During Fiscal Year 2022, the University?s three campuses in total expended approximately $916 million in R&D grant funds: $504 million, $406 million and $6 million from the Boulder, Denver and UCCS campuses, respectively. Of that amount, the University?s three campuses expended a total of approximately $191 million for equipment purchases, with $116 million, $69.6 million, and $5.4 million being spent by the Boulder, Denver, and UCCS campuses, respectively. What was the purpose of our audit work and what work was performed? The purpose of the audit work was to determine whether the University?s campuses had adequate internal controls in place over, and complied with, the R&D Cluster?s equipment management requirements for Fiscal Year 2022. As part of our audit work, we tested the University?s campuses? internal controls related to the R&D equipment management requirements. We tested 60 items of equipment with a total value of $1.2 million to determine whether the University appropriately safeguarded and maintained equipment, as required by federal regulations. In addition, we tested 40 of the 60 items of equipment with a total value of $840,000 to determine whether the University?s campuses appropriately placed property tags on the equipment as required by University policy. How were the results of the audit work measured? We measured the results of our audit work against the following requirements: ? Federal regulation 2 CFR 200.313(b) states that a State must use, manage and dispose of equipment acquired under a federal award to the State in accordance with the state laws and procedures. The University?s Property Control Manual section 1.3 states that the University is responsible and accountable for all property acquired with federal funding in accordance with federal regulations and the provision of a sponsored award. While under the heading of ?non-federal entities other than States,? federal regulation 2 CFR 200.313(c) through (e) also requires that equipment records be maintained, a physical inventory of equipment be taken at least once every two years and reconciled to the equipment record, an appropriate control system be used to safeguard equipment and all equipment shall be adequately maintained. ? The University?s Property Control Manual Section 3.3.1 states that ?only items having an acquisition cost of $5,000 or more are logged and tracked in the university property record.? Furthermore, the University?s Property Control Manual Section 3.3.3, states that equipment records should be updated for any changes discovered during the performance of an inventory over equipment. This would include equipment that should be removed from the listing because it was disposed of or is no longer in service. ? The University?s Property Control Manual section 3.2 states that ?All Government property at $5,000 or above in the custody of the Boulder campus must be tagged.? What problems did the audit work identify? We found that 2 of the 60 equipment items that we tested (3 percent,) with a total value of $39,400, were inappropriately included on the equipment listing even though they had either been disposed of in a prior period or were not in service. Specifically, one equipment item with an approximate value of $28,000 was no longer in service by the University, but still remained on the University?s inventory listing. The second equipment item with an approximate value of $8,400 was disposed of by the University on October 3, 2017, but was still on the list. In addition, we determined that 2 of the 40 equipment items we tested for tagging (5 percent) did not contain the tag as required by the University?s Property Control Manual. One of these items was valued at approximately $28,000. The second item was valued at approximately $31,000. Why did these problems occur? The University?s Boulder campus did not have adequate internal controls in place to ensure it complied with the R&D equipment management requirements. Specifically, although the University does have policies over equipment, Boulder campus staff were not adequately performing the procedures intrinsic in the policy. Specifically, neither the PAO nor the individual University departments adequately reconciled the equipment listing to the physical equipment on hand, which resulted in the list including equipment that had been disposed of or was no longer in use. Additionally, the Boulder Campus did not follow its own policies and procedures requiring that equipment with a value of $5,000 was appropriately tagged. One item?s tag was missing and a replacement tag had been ordered and not received at the time of our procedures. We could not determine whether the University identified that the tag was missing before we requested the information for review. The second item was below ground and the University did not maintain evidence of the original tag. Why do these problems matter? The University is obligated to adhere to specified requirements as outlined by federal regulations and the respective award agreement. By failing to adhere to the requirements for maintenance of equipment, the University potentially risks repercussions from the awarding agency. Furthermore, failing to properly maintain the equipment in accordance with federal and University requirements could increase the risk of theft or loss and decrease the ability of the University to adequately identify theft or loss. See Schedule of Findings and Questioned Costs for chart/table Recommendation 2022-065 The University of Colorado?s Boulder campus should strengthen its internal controls over equipment management and ensure that it complies with the Research and Development equipment management federal compliance requirements by: A. Ensuring the Campus Controller?s Property Accounting Office and the individual departments adequately reconcile the equipment listing to the physical equipment on hand to ensure that the list is accurate, and remove equipment from the listing that has been disposed of or is no longer in use. B. Enforcing its current policies and procedures for ensuring all equipment is appropriately tagged and maintained. Response University of Colorado A. Agree Implementation Date: March 2023 Management agrees with the recommendation. Procedures have been initiated with cross campus partners and will be fully implemented by March 2023. The proposed corrective action plan is as follows: ? Escalation procedures will be implemented in collaboration with campus partners so that action items identified in inventory reviews are addressed timely. ? The Campus Controller?s Office will work with campus partners to increase physical monitoring procedures to ensure tags are affixed and maintained on equipment. B. Agree Implementation Date: March 2023 Management agrees with the recommendation. Procedures have been initiated with cross campus partners and will be fully implemented by March 2023. The proposed corrective action plan is as follows: ? Escalation procedures will be implemented in collaboration with campus partners so that action items identified in inventory reviews are addressed timely. ? The Campus Controller?s Office will work with campus partners to increase physical monitoring procedures to ensure tags are affixed and maintained on equipment.
Finding 2022-065 Research and Development Cluster Equipment Management Compliance The federal government sponsors Research and Development (R&D) activities under a variety of types of awards, most commonly grants, cooperative agreements, and contracts, to achieve objectives agreed upon between the federal awarding agency and the non-federal entity. The types of R&D activities conducted under these awards vary greatly. The objective of an individual project is explained in the federal award document. R&D activities at the University are subject to federal equipment management requirements. In accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 201.1 Definitions, equipment is defined as tangible personal property (including information technology systems) having a useful life of more than one year and a per-unit acquisition cost which equals or exceeds the lesser of the capitalization level established by the non-Federal entity for financial statement purposes, or $5,000. The University uses equipment to meet the objective of its various research projects and this equipment may be common items such as a microscope or very complex scientific equipment, Under federal regulations, the University is required, for any equipment purchased under a federal contract, to maintain and track the equipment as to its location. The University must have an internal control structure in place in order to protect and safeguard the equipment and the University should be able to provide evidence that the equipment is safeguarded and maintained and show the location of all equipment. The Campus Controller?s Property Accounting Office (PAO) within the Boulder campus is responsible for equipment and property management. The PAO sends its full equipment listing quarterly to a portion of its individual departments with equipment, in a frequency to cover all departments within a two-year period. The individual departments are required to review the equipment listing, add any new equipment to the listing, and remove any equipment from the listing that has been disposed of or is no longer in service. Once the departments return the listings to the PAO, the PAO selects a sample to verify the information provided by the departments. The PAO selects the sample and the PAO Property Accountant then verifies the equipment?s existence by performing a site visit to the department and observing the equipment. The PAO selects a new sample each quarter. During Fiscal Year 2022, the University?s three campuses in total expended approximately $916 million in R&D grant funds: $504 million, $406 million and $6 million from the Boulder, Denver and UCCS campuses, respectively. Of that amount, the University?s three campuses expended a total of approximately $191 million for equipment purchases, with $116 million, $69.6 million, and $5.4 million being spent by the Boulder, Denver, and UCCS campuses, respectively. What was the purpose of our audit work and what work was performed? The purpose of the audit work was to determine whether the University?s campuses had adequate internal controls in place over, and complied with, the R&D Cluster?s equipment management requirements for Fiscal Year 2022. As part of our audit work, we tested the University?s campuses? internal controls related to the R&D equipment management requirements. We tested 60 items of equipment with a total value of $1.2 million to determine whether the University appropriately safeguarded and maintained equipment, as required by federal regulations. In addition, we tested 40 of the 60 items of equipment with a total value of $840,000 to determine whether the University?s campuses appropriately placed property tags on the equipment as required by University policy. How were the results of the audit work measured? We measured the results of our audit work against the following requirements: ? Federal regulation 2 CFR 200.313(b) states that a State must use, manage and dispose of equipment acquired under a federal award to the State in accordance with the state laws and procedures. The University?s Property Control Manual section 1.3 states that the University is responsible and accountable for all property acquired with federal funding in accordance with federal regulations and the provision of a sponsored award. While under the heading of ?non-federal entities other than States,? federal regulation 2 CFR 200.313(c) through (e) also requires that equipment records be maintained, a physical inventory of equipment be taken at least once every two years and reconciled to the equipment record, an appropriate control system be used to safeguard equipment and all equipment shall be adequately maintained. ? The University?s Property Control Manual Section 3.3.1 states that ?only items having an acquisition cost of $5,000 or more are logged and tracked in the university property record.? Furthermore, the University?s Property Control Manual Section 3.3.3, states that equipment records should be updated for any changes discovered during the performance of an inventory over equipment. This would include equipment that should be removed from the listing because it was disposed of or is no longer in service. ? The University?s Property Control Manual section 3.2 states that ?All Government property at $5,000 or above in the custody of the Boulder campus must be tagged.? What problems did the audit work identify? We found that 2 of the 60 equipment items that we tested (3 percent,) with a total value of $39,400, were inappropriately included on the equipment listing even though they had either been disposed of in a prior period or were not in service. Specifically, one equipment item with an approximate value of $28,000 was no longer in service by the University, but still remained on the University?s inventory listing. The second equipment item with an approximate value of $8,400 was disposed of by the University on October 3, 2017, but was still on the list. In addition, we determined that 2 of the 40 equipment items we tested for tagging (5 percent) did not contain the tag as required by the University?s Property Control Manual. One of these items was valued at approximately $28,000. The second item was valued at approximately $31,000. Why did these problems occur? The University?s Boulder campus did not have adequate internal controls in place to ensure it complied with the R&D equipment management requirements. Specifically, although the University does have policies over equipment, Boulder campus staff were not adequately performing the procedures intrinsic in the policy. Specifically, neither the PAO nor the individual University departments adequately reconciled the equipment listing to the physical equipment on hand, which resulted in the list including equipment that had been disposed of or was no longer in use. Additionally, the Boulder Campus did not follow its own policies and procedures requiring that equipment with a value of $5,000 was appropriately tagged. One item?s tag was missing and a replacement tag had been ordered and not received at the time of our procedures. We could not determine whether the University identified that the tag was missing before we requested the information for review. The second item was below ground and the University did not maintain evidence of the original tag. Why do these problems matter? The University is obligated to adhere to specified requirements as outlined by federal regulations and the respective award agreement. By failing to adhere to the requirements for maintenance of equipment, the University potentially risks repercussions from the awarding agency. Furthermore, failing to properly maintain the equipment in accordance with federal and University requirements could increase the risk of theft or loss and decrease the ability of the University to adequately identify theft or loss. See Schedule of Findings and Questioned Costs for chart/table Recommendation 2022-065 The University of Colorado?s Boulder campus should strengthen its internal controls over equipment management and ensure that it complies with the Research and Development equipment management federal compliance requirements by: A. Ensuring the Campus Controller?s Property Accounting Office and the individual departments adequately reconcile the equipment listing to the physical equipment on hand to ensure that the list is accurate, and remove equipment from the listing that has been disposed of or is no longer in use. B. Enforcing its current policies and procedures for ensuring all equipment is appropriately tagged and maintained. Response University of Colorado A. Agree Implementation Date: March 2023 Management agrees with the recommendation. Procedures have been initiated with cross campus partners and will be fully implemented by March 2023. The proposed corrective action plan is as follows: ? Escalation procedures will be implemented in collaboration with campus partners so that action items identified in inventory reviews are addressed timely. ? The Campus Controller?s Office will work with campus partners to increase physical monitoring procedures to ensure tags are affixed and maintained on equipment. B. Agree Implementation Date: March 2023 Management agrees with the recommendation. Procedures have been initiated with cross campus partners and will be fully implemented by March 2023. The proposed corrective action plan is as follows: ? Escalation procedures will be implemented in collaboration with campus partners so that action items identified in inventory reviews are addressed timely. ? The Campus Controller?s Office will work with campus partners to increase physical monitoring procedures to ensure tags are affixed and maintained on equipment.
Finding 2022-065 Research and Development Cluster Equipment Management Compliance The federal government sponsors Research and Development (R&D) activities under a variety of types of awards, most commonly grants, cooperative agreements, and contracts, to achieve objectives agreed upon between the federal awarding agency and the non-federal entity. The types of R&D activities conducted under these awards vary greatly. The objective of an individual project is explained in the federal award document. R&D activities at the University are subject to federal equipment management requirements. In accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 201.1 Definitions, equipment is defined as tangible personal property (including information technology systems) having a useful life of more than one year and a per-unit acquisition cost which equals or exceeds the lesser of the capitalization level established by the non-Federal entity for financial statement purposes, or $5,000. The University uses equipment to meet the objective of its various research projects and this equipment may be common items such as a microscope or very complex scientific equipment, Under federal regulations, the University is required, for any equipment purchased under a federal contract, to maintain and track the equipment as to its location. The University must have an internal control structure in place in order to protect and safeguard the equipment and the University should be able to provide evidence that the equipment is safeguarded and maintained and show the location of all equipment. The Campus Controller?s Property Accounting Office (PAO) within the Boulder campus is responsible for equipment and property management. The PAO sends its full equipment listing quarterly to a portion of its individual departments with equipment, in a frequency to cover all departments within a two-year period. The individual departments are required to review the equipment listing, add any new equipment to the listing, and remove any equipment from the listing that has been disposed of or is no longer in service. Once the departments return the listings to the PAO, the PAO selects a sample to verify the information provided by the departments. The PAO selects the sample and the PAO Property Accountant then verifies the equipment?s existence by performing a site visit to the department and observing the equipment. The PAO selects a new sample each quarter. During Fiscal Year 2022, the University?s three campuses in total expended approximately $916 million in R&D grant funds: $504 million, $406 million and $6 million from the Boulder, Denver and UCCS campuses, respectively. Of that amount, the University?s three campuses expended a total of approximately $191 million for equipment purchases, with $116 million, $69.6 million, and $5.4 million being spent by the Boulder, Denver, and UCCS campuses, respectively. What was the purpose of our audit work and what work was performed? The purpose of the audit work was to determine whether the University?s campuses had adequate internal controls in place over, and complied with, the R&D Cluster?s equipment management requirements for Fiscal Year 2022. As part of our audit work, we tested the University?s campuses? internal controls related to the R&D equipment management requirements. We tested 60 items of equipment with a total value of $1.2 million to determine whether the University appropriately safeguarded and maintained equipment, as required by federal regulations. In addition, we tested 40 of the 60 items of equipment with a total value of $840,000 to determine whether the University?s campuses appropriately placed property tags on the equipment as required by University policy. How were the results of the audit work measured? We measured the results of our audit work against the following requirements: ? Federal regulation 2 CFR 200.313(b) states that a State must use, manage and dispose of equipment acquired under a federal award to the State in accordance with the state laws and procedures. The University?s Property Control Manual section 1.3 states that the University is responsible and accountable for all property acquired with federal funding in accordance with federal regulations and the provision of a sponsored award. While under the heading of ?non-federal entities other than States,? federal regulation 2 CFR 200.313(c) through (e) also requires that equipment records be maintained, a physical inventory of equipment be taken at least once every two years and reconciled to the equipment record, an appropriate control system be used to safeguard equipment and all equipment shall be adequately maintained. ? The University?s Property Control Manual Section 3.3.1 states that ?only items having an acquisition cost of $5,000 or more are logged and tracked in the university property record.? Furthermore, the University?s Property Control Manual Section 3.3.3, states that equipment records should be updated for any changes discovered during the performance of an inventory over equipment. This would include equipment that should be removed from the listing because it was disposed of or is no longer in service. ? The University?s Property Control Manual section 3.2 states that ?All Government property at $5,000 or above in the custody of the Boulder campus must be tagged.? What problems did the audit work identify? We found that 2 of the 60 equipment items that we tested (3 percent,) with a total value of $39,400, were inappropriately included on the equipment listing even though they had either been disposed of in a prior period or were not in service. Specifically, one equipment item with an approximate value of $28,000 was no longer in service by the University, but still remained on the University?s inventory listing. The second equipment item with an approximate value of $8,400 was disposed of by the University on October 3, 2017, but was still on the list. In addition, we determined that 2 of the 40 equipment items we tested for tagging (5 percent) did not contain the tag as required by the University?s Property Control Manual. One of these items was valued at approximately $28,000. The second item was valued at approximately $31,000. Why did these problems occur? The University?s Boulder campus did not have adequate internal controls in place to ensure it complied with the R&D equipment management requirements. Specifically, although the University does have policies over equipment, Boulder campus staff were not adequately performing the procedures intrinsic in the policy. Specifically, neither the PAO nor the individual University departments adequately reconciled the equipment listing to the physical equipment on hand, which resulted in the list including equipment that had been disposed of or was no longer in use. Additionally, the Boulder Campus did not follow its own policies and procedures requiring that equipment with a value of $5,000 was appropriately tagged. One item?s tag was missing and a replacement tag had been ordered and not received at the time of our procedures. We could not determine whether the University identified that the tag was missing before we requested the information for review. The second item was below ground and the University did not maintain evidence of the original tag. Why do these problems matter? The University is obligated to adhere to specified requirements as outlined by federal regulations and the respective award agreement. By failing to adhere to the requirements for maintenance of equipment, the University potentially risks repercussions from the awarding agency. Furthermore, failing to properly maintain the equipment in accordance with federal and University requirements could increase the risk of theft or loss and decrease the ability of the University to adequately identify theft or loss. See Schedule of Findings and Questioned Costs for chart/table Recommendation 2022-065 The University of Colorado?s Boulder campus should strengthen its internal controls over equipment management and ensure that it complies with the Research and Development equipment management federal compliance requirements by: A. Ensuring the Campus Controller?s Property Accounting Office and the individual departments adequately reconcile the equipment listing to the physical equipment on hand to ensure that the list is accurate, and remove equipment from the listing that has been disposed of or is no longer in use. B. Enforcing its current policies and procedures for ensuring all equipment is appropriately tagged and maintained. Response University of Colorado A. Agree Implementation Date: March 2023 Management agrees with the recommendation. Procedures have been initiated with cross campus partners and will be fully implemented by March 2023. The proposed corrective action plan is as follows: ? Escalation procedures will be implemented in collaboration with campus partners so that action items identified in inventory reviews are addressed timely. ? The Campus Controller?s Office will work with campus partners to increase physical monitoring procedures to ensure tags are affixed and maintained on equipment. B. Agree Implementation Date: March 2023 Management agrees with the recommendation. Procedures have been initiated with cross campus partners and will be fully implemented by March 2023. The proposed corrective action plan is as follows: ? Escalation procedures will be implemented in collaboration with campus partners so that action items identified in inventory reviews are addressed timely. ? The Campus Controller?s Office will work with campus partners to increase physical monitoring procedures to ensure tags are affixed and maintained on equipment.
Finding 2022-065 Research and Development Cluster Equipment Management Compliance The federal government sponsors Research and Development (R&D) activities under a variety of types of awards, most commonly grants, cooperative agreements, and contracts, to achieve objectives agreed upon between the federal awarding agency and the non-federal entity. The types of R&D activities conducted under these awards vary greatly. The objective of an individual project is explained in the federal award document. R&D activities at the University are subject to federal equipment management requirements. In accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 201.1 Definitions, equipment is defined as tangible personal property (including information technology systems) having a useful life of more than one year and a per-unit acquisition cost which equals or exceeds the lesser of the capitalization level established by the non-Federal entity for financial statement purposes, or $5,000. The University uses equipment to meet the objective of its various research projects and this equipment may be common items such as a microscope or very complex scientific equipment, Under federal regulations, the University is required, for any equipment purchased under a federal contract, to maintain and track the equipment as to its location. The University must have an internal control structure in place in order to protect and safeguard the equipment and the University should be able to provide evidence that the equipment is safeguarded and maintained and show the location of all equipment. The Campus Controller?s Property Accounting Office (PAO) within the Boulder campus is responsible for equipment and property management. The PAO sends its full equipment listing quarterly to a portion of its individual departments with equipment, in a frequency to cover all departments within a two-year period. The individual departments are required to review the equipment listing, add any new equipment to the listing, and remove any equipment from the listing that has been disposed of or is no longer in service. Once the departments return the listings to the PAO, the PAO selects a sample to verify the information provided by the departments. The PAO selects the sample and the PAO Property Accountant then verifies the equipment?s existence by performing a site visit to the department and observing the equipment. The PAO selects a new sample each quarter. During Fiscal Year 2022, the University?s three campuses in total expended approximately $916 million in R&D grant funds: $504 million, $406 million and $6 million from the Boulder, Denver and UCCS campuses, respectively. Of that amount, the University?s three campuses expended a total of approximately $191 million for equipment purchases, with $116 million, $69.6 million, and $5.4 million being spent by the Boulder, Denver, and UCCS campuses, respectively. What was the purpose of our audit work and what work was performed? The purpose of the audit work was to determine whether the University?s campuses had adequate internal controls in place over, and complied with, the R&D Cluster?s equipment management requirements for Fiscal Year 2022. As part of our audit work, we tested the University?s campuses? internal controls related to the R&D equipment management requirements. We tested 60 items of equipment with a total value of $1.2 million to determine whether the University appropriately safeguarded and maintained equipment, as required by federal regulations. In addition, we tested 40 of the 60 items of equipment with a total value of $840,000 to determine whether the University?s campuses appropriately placed property tags on the equipment as required by University policy. How were the results of the audit work measured? We measured the results of our audit work against the following requirements: ? Federal regulation 2 CFR 200.313(b) states that a State must use, manage and dispose of equipment acquired under a federal award to the State in accordance with the state laws and procedures. The University?s Property Control Manual section 1.3 states that the University is responsible and accountable for all property acquired with federal funding in accordance with federal regulations and the provision of a sponsored award. While under the heading of ?non-federal entities other than States,? federal regulation 2 CFR 200.313(c) through (e) also requires that equipment records be maintained, a physical inventory of equipment be taken at least once every two years and reconciled to the equipment record, an appropriate control system be used to safeguard equipment and all equipment shall be adequately maintained. ? The University?s Property Control Manual Section 3.3.1 states that ?only items having an acquisition cost of $5,000 or more are logged and tracked in the university property record.? Furthermore, the University?s Property Control Manual Section 3.3.3, states that equipment records should be updated for any changes discovered during the performance of an inventory over equipment. This would include equipment that should be removed from the listing because it was disposed of or is no longer in service. ? The University?s Property Control Manual section 3.2 states that ?All Government property at $5,000 or above in the custody of the Boulder campus must be tagged.? What problems did the audit work identify? We found that 2 of the 60 equipment items that we tested (3 percent,) with a total value of $39,400, were inappropriately included on the equipment listing even though they had either been disposed of in a prior period or were not in service. Specifically, one equipment item with an approximate value of $28,000 was no longer in service by the University, but still remained on the University?s inventory listing. The second equipment item with an approximate value of $8,400 was disposed of by the University on October 3, 2017, but was still on the list. In addition, we determined that 2 of the 40 equipment items we tested for tagging (5 percent) did not contain the tag as required by the University?s Property Control Manual. One of these items was valued at approximately $28,000. The second item was valued at approximately $31,000. Why did these problems occur? The University?s Boulder campus did not have adequate internal controls in place to ensure it complied with the R&D equipment management requirements. Specifically, although the University does have policies over equipment, Boulder campus staff were not adequately performing the procedures intrinsic in the policy. Specifically, neither the PAO nor the individual University departments adequately reconciled the equipment listing to the physical equipment on hand, which resulted in the list including equipment that had been disposed of or was no longer in use. Additionally, the Boulder Campus did not follow its own policies and procedures requiring that equipment with a value of $5,000 was appropriately tagged. One item?s tag was missing and a replacement tag had been ordered and not received at the time of our procedures. We could not determine whether the University identified that the tag was missing before we requested the information for review. The second item was below ground and the University did not maintain evidence of the original tag. Why do these problems matter? The University is obligated to adhere to specified requirements as outlined by federal regulations and the respective award agreement. By failing to adhere to the requirements for maintenance of equipment, the University potentially risks repercussions from the awarding agency. Furthermore, failing to properly maintain the equipment in accordance with federal and University requirements could increase the risk of theft or loss and decrease the ability of the University to adequately identify theft or loss. See Schedule of Findings and Questioned Costs for chart/table Recommendation 2022-065 The University of Colorado?s Boulder campus should strengthen its internal controls over equipment management and ensure that it complies with the Research and Development equipment management federal compliance requirements by: A. Ensuring the Campus Controller?s Property Accounting Office and the individual departments adequately reconcile the equipment listing to the physical equipment on hand to ensure that the list is accurate, and remove equipment from the listing that has been disposed of or is no longer in use. B. Enforcing its current policies and procedures for ensuring all equipment is appropriately tagged and maintained. Response University of Colorado A. Agree Implementation Date: March 2023 Management agrees with the recommendation. Procedures have been initiated with cross campus partners and will be fully implemented by March 2023. The proposed corrective action plan is as follows: ? Escalation procedures will be implemented in collaboration with campus partners so that action items identified in inventory reviews are addressed timely. ? The Campus Controller?s Office will work with campus partners to increase physical monitoring procedures to ensure tags are affixed and maintained on equipment. B. Agree Implementation Date: March 2023 Management agrees with the recommendation. Procedures have been initiated with cross campus partners and will be fully implemented by March 2023. The proposed corrective action plan is as follows: ? Escalation procedures will be implemented in collaboration with campus partners so that action items identified in inventory reviews are addressed timely. ? The Campus Controller?s Office will work with campus partners to increase physical monitoring procedures to ensure tags are affixed and maintained on equipment.
FINDING 2022-007 FEDERAL PROGRAM HEAD START (ASSISTANCE LISTING NO. 93.600) DEPARTMENT OF HEALTH AND HUMAN SERVICES CATEGORY INTERNAL CONTROL-MATERIAL WEAKNESS NONCOMPLIANCE EQUIPMENT AND REAL PROPERTY MANAGEMENT CONDITIONS The Head Start Program is not maintaining adequate internal controls over property and equipment items acquired with Federal Funds. In testing property and equipment, we noted the following: The property records were not reliable because they did not include all the required information and they were incomplete or missing information. CRITERIA 2 CFR 200.313 (d) and the 45 CFR 75.320 (d) establishes that procedures for managing equipment 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 property, who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the cost of the property, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. (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 shall be investigated. CAUSE The Head Start Program has inadequate internal control procedures that guarantee adequate records, registering and safeguarding of property and equipment. EFFECT Due to the lack of internal controls and property accounting records, we could not validate the accuracy and completeness of equipment and property-related reports. RECOMMENDATION The Head Start Program must prepare a report including a full description of the assets, location, use, responsible person, cost, and any other pertinent data. In addition, the Program should establish a property control account and a subsidiary ledger to provide for the reconciliation of property. QUESTIONED COSTS None PRIOR YEAR 2021-004 VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION The finding was corrected for future efforts related to the area of the property. A private company was hired to conduct the inventory. Appropriate seizures of disused equipment were carried out and an annual inventory of all existing equipment is being carried out, with ownership number, location and required information. RESPONSIBLE PERSON Mr. Angel Vélez-Program Director 787-894-9191
FA 2022-001 Improve Controls over Equipment Compliance Requirements: Equipment and Real Property Management Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: COVID-19 – 84.425D – Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425U – American Rescue Plan Elementary and Secondary School Emergency Relief Fund Federal Award Numbers: S425D200012 (Year: 2021), S425U2100012 (Year: 2021) Questioned Costs: None Identified Description: The policies and procedures of the School District were insufficient to provide adequate internal controls over equipment and real property management as it relates to the Elementary and Secondary School Emergency Relief Fund program. Background Information: On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. The CARES Act was designed to mitigate the economic effects of the COVID-19 pandemic in a variety of ways, including providing additional funding for local educational agencies (LEAs) navigating the impact of the COVID-19 outbreak. Provisions included in Title VIII of the CARES Act created the Education Stabilization Fund to provide financial resources to educational entities to prevent, prepare for, and respond to coronavirus. The CARES Act allocated $30.75 billion, the Coronavirus Response and Relief Supplemental Appropriations Act allocated an additional $81.9 billion, and the American Rescue Plan Act added $165.1 billion in funding to the Education Stabilization Fund. Multiple Education Stabilization Fund subprograms were created and allotted funding through the various COVID-19-related legislation. Of these programs, the Elementary and Secondary School Emergency Relief (ESSER) Fund was created to address the impact that COVID-19 has had, and continues to have, on elementary and secondary schools across the nation. ESSER funding was granted to the Georgia Department of Education (GaDOE) by the U.S. Department of Education (ED). GaDOE is responsible for distributing funds to LEAs and overseeing the expenditure of funds by LEAs. ESSER funds totaling $9,339,507.81 were expended and reported on the Burke County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Provisions included in the Uniform Guidance, Section 200.313(d)(1) state, “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.” In addition, the Uniform Guidance, Section 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.” Condition: The following deficiencies were noted when reviewing the ESSER program equipment listing and physically locating equipment items: • Property records were not maintained by Federal program personnel. Capital asset records did not include the following required components for all items: the source of funding for the property (including the FAIN). • There was no evidence that a physical inventory had been performed in either the current year or the previous year. Cause: Federal program personnel did not include the FAIN number for all items due to oversight. Program personnel for the ESSER program did not keep an equipment listing or take a physical inventory because they considered it a duplication of effort due to the items being listed on the overall capital asset listing and were not aware that a physical inventory was not done. Effect or Potential Effect: The School District is not in compliance with the Uniform Guidance or GaDOE guidance related to the ESSER program. Failure to maintain a complete and accurate equipment listing and reconcile results of the physical inventory performed to the property records exposes the School District to unnecessary risk of error and misuse of equipment and/or federal funds. Recommendation: The School District should develop and maintain an equipment listing that reflects all required information, including a description, an identifying number, the source of funding, the title holder, the acquisition date, the cost, the percentage of federal participation in the project costs, the location, the use and condition, and any ultimate disposal data for each piece of equipment. In addition, management should implement controls to ensure that a complete physical inventory of equipment is performed, and the results are reconciled back to the equipment listing at least once every two years. Views of Responsible Officials: We concur with this finding.
FA 2022-001 Improve Controls over Equipment Compliance Requirements: Equipment and Real Property Management Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: COVID-19 – 84.425D – Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425U – American Rescue Plan Elementary and Secondary School Emergency Relief Fund Federal Award Numbers: S425D200012 (Year: 2021), S425U2100012 (Year: 2021) Questioned Costs: None Identified Description: The policies and procedures of the School District were insufficient to provide adequate internal controls over equipment and real property management as it relates to the Elementary and Secondary School Emergency Relief Fund program. Background Information: On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. The CARES Act was designed to mitigate the economic effects of the COVID-19 pandemic in a variety of ways, including providing additional funding for local educational agencies (LEAs) navigating the impact of the COVID-19 outbreak. Provisions included in Title VIII of the CARES Act created the Education Stabilization Fund to provide financial resources to educational entities to prevent, prepare for, and respond to coronavirus. The CARES Act allocated $30.75 billion, the Coronavirus Response and Relief Supplemental Appropriations Act allocated an additional $81.9 billion, and the American Rescue Plan Act added $165.1 billion in funding to the Education Stabilization Fund. Multiple Education Stabilization Fund subprograms were created and allotted funding through the various COVID-19-related legislation. Of these programs, the Elementary and Secondary School Emergency Relief (ESSER) Fund was created to address the impact that COVID-19 has had, and continues to have, on elementary and secondary schools across the nation. ESSER funding was granted to the Georgia Department of Education (GaDOE) by the U.S. Department of Education (ED). GaDOE is responsible for distributing funds to LEAs and overseeing the expenditure of funds by LEAs. ESSER funds totaling $9,339,507.81 were expended and reported on the Burke County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Provisions included in the Uniform Guidance, Section 200.313(d)(1) state, “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.” In addition, the Uniform Guidance, Section 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.” Condition: The following deficiencies were noted when reviewing the ESSER program equipment listing and physically locating equipment items: • Property records were not maintained by Federal program personnel. Capital asset records did not include the following required components for all items: the source of funding for the property (including the FAIN). • There was no evidence that a physical inventory had been performed in either the current year or the previous year. Cause: Federal program personnel did not include the FAIN number for all items due to oversight. Program personnel for the ESSER program did not keep an equipment listing or take a physical inventory because they considered it a duplication of effort due to the items being listed on the overall capital asset listing and were not aware that a physical inventory was not done. Effect or Potential Effect: The School District is not in compliance with the Uniform Guidance or GaDOE guidance related to the ESSER program. Failure to maintain a complete and accurate equipment listing and reconcile results of the physical inventory performed to the property records exposes the School District to unnecessary risk of error and misuse of equipment and/or federal funds. Recommendation: The School District should develop and maintain an equipment listing that reflects all required information, including a description, an identifying number, the source of funding, the title holder, the acquisition date, the cost, the percentage of federal participation in the project costs, the location, the use and condition, and any ultimate disposal data for each piece of equipment. In addition, management should implement controls to ensure that a complete physical inventory of equipment is performed, and the results are reconciled back to the equipment listing at least once every two years. Views of Responsible Officials: We concur with this finding.
FA 2022-001 Improve Controls over Equipment Compliance Requirements: Equipment and Real Property Management Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: COVID-19 – 84.425D – Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425U – American Rescue Plan Elementary and Secondary School Emergency Relief Fund Federal Award Numbers: S425D200012 (Year: 2021), S425U2100012 (Year: 2021) Questioned Costs: None Identified Description: The policies and procedures of the School District were insufficient to provide adequate internal controls over equipment and real property management as it relates to the Elementary and Secondary School Emergency Relief Fund program. Background Information: On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. The CARES Act was designed to mitigate the economic effects of the COVID-19 pandemic in a variety of ways, including providing additional funding for local educational agencies (LEAs) navigating the impact of the COVID-19 outbreak. Provisions included in Title VIII of the CARES Act created the Education Stabilization Fund to provide financial resources to educational entities to prevent, prepare for, and respond to coronavirus. The CARES Act allocated $30.75 billion, the Coronavirus Response and Relief Supplemental Appropriations Act allocated an additional $81.9 billion, and the American Rescue Plan Act added $165.1 billion in funding to the Education Stabilization Fund. Multiple Education Stabilization Fund subprograms were created and allotted funding through the various COVID-19-related legislation. Of these programs, the Elementary and Secondary School Emergency Relief (ESSER) Fund was created to address the impact that COVID-19 has had, and continues to have, on elementary and secondary schools across the nation. ESSER funding was granted to the Georgia Department of Education (GaDOE) by the U.S. Department of Education (ED). GaDOE is responsible for distributing funds to LEAs and overseeing the expenditure of funds by LEAs. ESSER funds totaling $9,339,507.81 were expended and reported on the Burke County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Provisions included in the Uniform Guidance, Section 200.313(d)(1) state, “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.” In addition, the Uniform Guidance, Section 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.” Condition: The following deficiencies were noted when reviewing the ESSER program equipment listing and physically locating equipment items: • Property records were not maintained by Federal program personnel. Capital asset records did not include the following required components for all items: the source of funding for the property (including the FAIN). • There was no evidence that a physical inventory had been performed in either the current year or the previous year. Cause: Federal program personnel did not include the FAIN number for all items due to oversight. Program personnel for the ESSER program did not keep an equipment listing or take a physical inventory because they considered it a duplication of effort due to the items being listed on the overall capital asset listing and were not aware that a physical inventory was not done. Effect or Potential Effect: The School District is not in compliance with the Uniform Guidance or GaDOE guidance related to the ESSER program. Failure to maintain a complete and accurate equipment listing and reconcile results of the physical inventory performed to the property records exposes the School District to unnecessary risk of error and misuse of equipment and/or federal funds. Recommendation: The School District should develop and maintain an equipment listing that reflects all required information, including a description, an identifying number, the source of funding, the title holder, the acquisition date, the cost, the percentage of federal participation in the project costs, the location, the use and condition, and any ultimate disposal data for each piece of equipment. In addition, management should implement controls to ensure that a complete physical inventory of equipment is performed, and the results are reconciled back to the equipment listing at least once every two years. Views of Responsible Officials: We concur with this finding.
FA 2022-001 Improve Controls over Equipment Compliance Requirements: Equipment and Real Property Management Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: COVID-19 – 84.425D – Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425U – American Rescue Plan Elementary and Secondary School Emergency Relief Fund Federal Award Numbers: S425D200012 (Year: 2021), S425U2100012 (Year: 2021) Questioned Costs: None Identified Description: The policies and procedures of the School District were insufficient to provide adequate internal controls over equipment and real property management as it relates to the Elementary and Secondary School Emergency Relief Fund program. Background Information: On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. The CARES Act was designed to mitigate the economic effects of the COVID-19 pandemic in a variety of ways, including providing additional funding for local educational agencies (LEAs) navigating the impact of the COVID-19 outbreak. Provisions included in Title VIII of the CARES Act created the Education Stabilization Fund to provide financial resources to educational entities to prevent, prepare for, and respond to coronavirus. The CARES Act allocated $30.75 billion, the Coronavirus Response and Relief Supplemental Appropriations Act allocated an additional $81.9 billion, and the American Rescue Plan Act added $165.1 billion in funding to the Education Stabilization Fund. Multiple Education Stabilization Fund subprograms were created and allotted funding through the various COVID-19-related legislation. Of these programs, the Elementary and Secondary School Emergency Relief (ESSER) Fund was created to address the impact that COVID-19 has had, and continues to have, on elementary and secondary schools across the nation. ESSER funding was granted to the Georgia Department of Education (GaDOE) by the U.S. Department of Education (ED). GaDOE is responsible for distributing funds to LEAs and overseeing the expenditure of funds by LEAs. ESSER funds totaling $9,339,507.81 were expended and reported on the Burke County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Provisions included in the Uniform Guidance, Section 200.313(d)(1) state, “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.” In addition, the Uniform Guidance, Section 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.” Condition: The following deficiencies were noted when reviewing the ESSER program equipment listing and physically locating equipment items: • Property records were not maintained by Federal program personnel. Capital asset records did not include the following required components for all items: the source of funding for the property (including the FAIN). • There was no evidence that a physical inventory had been performed in either the current year or the previous year. Cause: Federal program personnel did not include the FAIN number for all items due to oversight. Program personnel for the ESSER program did not keep an equipment listing or take a physical inventory because they considered it a duplication of effort due to the items being listed on the overall capital asset listing and were not aware that a physical inventory was not done. Effect or Potential Effect: The School District is not in compliance with the Uniform Guidance or GaDOE guidance related to the ESSER program. Failure to maintain a complete and accurate equipment listing and reconcile results of the physical inventory performed to the property records exposes the School District to unnecessary risk of error and misuse of equipment and/or federal funds. Recommendation: The School District should develop and maintain an equipment listing that reflects all required information, including a description, an identifying number, the source of funding, the title holder, the acquisition date, the cost, the percentage of federal participation in the project costs, the location, the use and condition, and any ultimate disposal data for each piece of equipment. In addition, management should implement controls to ensure that a complete physical inventory of equipment is performed, and the results are reconciled back to the equipment listing at least once every two years. Views of Responsible Officials: We concur with this finding.
FA 2022-001 Improve Controls over Equipment Compliance Requirement: Equipment and Real Property Management Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Agriculture Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: 10.553 – School Breakfast Program 10.555 – National School Lunch Program Federal Award Number: 225GA324N1199 Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: COVID-19 – 84.425D – Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425U – American Rescue Plan Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425W – American Rescue Plan Elementary and Secondary School Emergency Relief Fund – Homeless Children and Youth Federal Award Numbers: S425D200012 (Year: 2020), S425D210012 (Year: 2021) S425U210012 (Year: 2021), S425W210011 (Year: 2021) Questioned Costs: None Identified Repeat of Prior Year Finding: FA 2021-001, FA 2020-001, FA 2019-003, FA 2018-002, FA 2017-004 Description: The policies and procedures of the School District were insufficient to provide adequate internal controls over equipment and real property management as it relates to the Child Nutrition Cluster and Elementary and Secondary School Emergency Relief Fund programs. Background: The Child Nutrition Cluster (CNC) is comprised of various programs that are intended to assist states in administering and overseeing food service program operators that provide healthful, nutritious meals to eligible children in public and non-profit private schools, residential child care institutions, and summer programs. This Cluster of programs also fosters healthy eating habits in children by providing fresh fruits and fresh vegetables to children attending elementary and secondary schools and encourages the domestic consumption of nutritious agricultural commodities. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. The CARES Act was designed to mitigate the economic effects of the COVID-19 pandemic in a variety of ways, including providing additional funding for local educational agencies (LEAs) navigating the impact of the COVID-19 outbreak. Provisions included in Title VIII of the CARES Act created the Education Stabilization Fund to provide financial resources to educational entities to prevent, prepare for, and respond to coronavirus. The CARES Act allocated $30.75 billion, the Coronavirus Response and Relief Supplemental Appropriations Act allocated an additional $81.9 billion, and the American Rescue Plan Act added $165.1 billion in funding to the Education Stabilization Fund. Multiple Education Stabilization Fund subprograms were created and allotted funding through the various COVID-19-related legislation. Of these programs, the Elementary and Secondary School Emergency Relief (ESSER) Fund was created to address the impact that COVID-19 has had, and continues to have, on elementary and secondary schools across the nation. CNC and ESSER funding was granted to the Georgia Department of Education (GDOE) by the U.S. Department of Agriculture and U.S. Department of Education (ED), respectively. GDOE is responsible for distributing funds to LEAs and overseeing the programs. CNC funds totaling $1,113,376.14 and ESSER funds totaling $3,586,443.78 were expended and reported on the Dooly County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Provisions included in the Uniform Guidance, Section 200.313(d)(1) state, "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." In addition, the Uniform Guidance, Section 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." Condition: The following deficiencies were noted when reviewing the CNC and ESSER equipment listings and physically locating equipment items: • Property records did not include the following required components for CNC equipment items: (1) Percentage of Federal participation in the project costs for the Federal award under which the property was acquired, (2) the source of funding for the property (including the FAIN), and (3) who holds title. • Property records did not include the following required components for Elementary and Secondary School Emergency Relief Fund equipment items: (1) Percentage of Federal participation in the project costs for the Federal award under which the property was acquired, (2) who holds title, and (3) use and condition of the property. • An equipment item totaling $501,596.61 purchased using ESSER funds was included on the financial statement capital asset listing but was excluded from the program equipment listing. Cause: In discussing this deficiency with the School District, they stated these issues were a result of turnover within the Central Office. In addition, the ESSER equipment item was overlooked when preparing the program equipment listing. Effect: Failure to maintain a complete and accurate equipment listing and reconcile results of the physical inventory performed to the property records exposes the School District to unnecessary risk of error and misuse of equipment and/or Federal funds. Additionally, the School District is not in compliance with the Uniform Guidance and Georgia Department of Education guidance. Recommendation: The School District should develop and maintain equipment listings that reflect all required information, including a description, an identifying number, the source of funding, the title holder, the acquisition date, the cost, the percentage of Federal participation in the project costs, the location, the use and condition, and any ultimate disposal data for each piece of equipment. In addition, management should implement controls to ensure that a complete physical inventory of equipment is performed for every Federal program, and the results are reconciled back to the equipment listings at least once every two years. Views of Responsible Officials: We concur with this finding.
FA 2022-001 Improve Controls over Equipment Compliance Requirement: Equipment and Real Property Management Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Agriculture Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: 10.553 – School Breakfast Program 10.555 – National School Lunch Program Federal Award Number: 225GA324N1199 Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: COVID-19 – 84.425D – Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425U – American Rescue Plan Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425W – American Rescue Plan Elementary and Secondary School Emergency Relief Fund – Homeless Children and Youth Federal Award Numbers: S425D200012 (Year: 2020), S425D210012 (Year: 2021) S425U210012 (Year: 2021), S425W210011 (Year: 2021) Questioned Costs: None Identified Repeat of Prior Year Finding: FA 2021-001, FA 2020-001, FA 2019-003, FA 2018-002, FA 2017-004 Description: The policies and procedures of the School District were insufficient to provide adequate internal controls over equipment and real property management as it relates to the Child Nutrition Cluster and Elementary and Secondary School Emergency Relief Fund programs. Background: The Child Nutrition Cluster (CNC) is comprised of various programs that are intended to assist states in administering and overseeing food service program operators that provide healthful, nutritious meals to eligible children in public and non-profit private schools, residential child care institutions, and summer programs. This Cluster of programs also fosters healthy eating habits in children by providing fresh fruits and fresh vegetables to children attending elementary and secondary schools and encourages the domestic consumption of nutritious agricultural commodities. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. The CARES Act was designed to mitigate the economic effects of the COVID-19 pandemic in a variety of ways, including providing additional funding for local educational agencies (LEAs) navigating the impact of the COVID-19 outbreak. Provisions included in Title VIII of the CARES Act created the Education Stabilization Fund to provide financial resources to educational entities to prevent, prepare for, and respond to coronavirus. The CARES Act allocated $30.75 billion, the Coronavirus Response and Relief Supplemental Appropriations Act allocated an additional $81.9 billion, and the American Rescue Plan Act added $165.1 billion in funding to the Education Stabilization Fund. Multiple Education Stabilization Fund subprograms were created and allotted funding through the various COVID-19-related legislation. Of these programs, the Elementary and Secondary School Emergency Relief (ESSER) Fund was created to address the impact that COVID-19 has had, and continues to have, on elementary and secondary schools across the nation. CNC and ESSER funding was granted to the Georgia Department of Education (GDOE) by the U.S. Department of Agriculture and U.S. Department of Education (ED), respectively. GDOE is responsible for distributing funds to LEAs and overseeing the programs. CNC funds totaling $1,113,376.14 and ESSER funds totaling $3,586,443.78 were expended and reported on the Dooly County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Provisions included in the Uniform Guidance, Section 200.313(d)(1) state, "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." In addition, the Uniform Guidance, Section 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." Condition: The following deficiencies were noted when reviewing the CNC and ESSER equipment listings and physically locating equipment items: • Property records did not include the following required components for CNC equipment items: (1) Percentage of Federal participation in the project costs for the Federal award under which the property was acquired, (2) the source of funding for the property (including the FAIN), and (3) who holds title. • Property records did not include the following required components for Elementary and Secondary School Emergency Relief Fund equipment items: (1) Percentage of Federal participation in the project costs for the Federal award under which the property was acquired, (2) who holds title, and (3) use and condition of the property. • An equipment item totaling $501,596.61 purchased using ESSER funds was included on the financial statement capital asset listing but was excluded from the program equipment listing. Cause: In discussing this deficiency with the School District, they stated these issues were a result of turnover within the Central Office. In addition, the ESSER equipment item was overlooked when preparing the program equipment listing. Effect: Failure to maintain a complete and accurate equipment listing and reconcile results of the physical inventory performed to the property records exposes the School District to unnecessary risk of error and misuse of equipment and/or Federal funds. Additionally, the School District is not in compliance with the Uniform Guidance and Georgia Department of Education guidance. Recommendation: The School District should develop and maintain equipment listings that reflect all required information, including a description, an identifying number, the source of funding, the title holder, the acquisition date, the cost, the percentage of Federal participation in the project costs, the location, the use and condition, and any ultimate disposal data for each piece of equipment. In addition, management should implement controls to ensure that a complete physical inventory of equipment is performed for every Federal program, and the results are reconciled back to the equipment listings at least once every two years. Views of Responsible Officials: We concur with this finding.
FA 2022-001 Improve Controls over Equipment Compliance Requirement: Equipment and Real Property Management Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Agriculture Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: 10.553 – School Breakfast Program 10.555 – National School Lunch Program Federal Award Number: 225GA324N1199 Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: COVID-19 – 84.425D – Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425U – American Rescue Plan Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425W – American Rescue Plan Elementary and Secondary School Emergency Relief Fund – Homeless Children and Youth Federal Award Numbers: S425D200012 (Year: 2020), S425D210012 (Year: 2021) S425U210012 (Year: 2021), S425W210011 (Year: 2021) Questioned Costs: None Identified Repeat of Prior Year Finding: FA 2021-001, FA 2020-001, FA 2019-003, FA 2018-002, FA 2017-004 Description: The policies and procedures of the School District were insufficient to provide adequate internal controls over equipment and real property management as it relates to the Child Nutrition Cluster and Elementary and Secondary School Emergency Relief Fund programs. Background: The Child Nutrition Cluster (CNC) is comprised of various programs that are intended to assist states in administering and overseeing food service program operators that provide healthful, nutritious meals to eligible children in public and non-profit private schools, residential child care institutions, and summer programs. This Cluster of programs also fosters healthy eating habits in children by providing fresh fruits and fresh vegetables to children attending elementary and secondary schools and encourages the domestic consumption of nutritious agricultural commodities. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. The CARES Act was designed to mitigate the economic effects of the COVID-19 pandemic in a variety of ways, including providing additional funding for local educational agencies (LEAs) navigating the impact of the COVID-19 outbreak. Provisions included in Title VIII of the CARES Act created the Education Stabilization Fund to provide financial resources to educational entities to prevent, prepare for, and respond to coronavirus. The CARES Act allocated $30.75 billion, the Coronavirus Response and Relief Supplemental Appropriations Act allocated an additional $81.9 billion, and the American Rescue Plan Act added $165.1 billion in funding to the Education Stabilization Fund. Multiple Education Stabilization Fund subprograms were created and allotted funding through the various COVID-19-related legislation. Of these programs, the Elementary and Secondary School Emergency Relief (ESSER) Fund was created to address the impact that COVID-19 has had, and continues to have, on elementary and secondary schools across the nation. CNC and ESSER funding was granted to the Georgia Department of Education (GDOE) by the U.S. Department of Agriculture and U.S. Department of Education (ED), respectively. GDOE is responsible for distributing funds to LEAs and overseeing the programs. CNC funds totaling $1,113,376.14 and ESSER funds totaling $3,586,443.78 were expended and reported on the Dooly County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Provisions included in the Uniform Guidance, Section 200.313(d)(1) state, "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." In addition, the Uniform Guidance, Section 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." Condition: The following deficiencies were noted when reviewing the CNC and ESSER equipment listings and physically locating equipment items: • Property records did not include the following required components for CNC equipment items: (1) Percentage of Federal participation in the project costs for the Federal award under which the property was acquired, (2) the source of funding for the property (including the FAIN), and (3) who holds title. • Property records did not include the following required components for Elementary and Secondary School Emergency Relief Fund equipment items: (1) Percentage of Federal participation in the project costs for the Federal award under which the property was acquired, (2) who holds title, and (3) use and condition of the property. • An equipment item totaling $501,596.61 purchased using ESSER funds was included on the financial statement capital asset listing but was excluded from the program equipment listing. Cause: In discussing this deficiency with the School District, they stated these issues were a result of turnover within the Central Office. In addition, the ESSER equipment item was overlooked when preparing the program equipment listing. Effect: Failure to maintain a complete and accurate equipment listing and reconcile results of the physical inventory performed to the property records exposes the School District to unnecessary risk of error and misuse of equipment and/or Federal funds. Additionally, the School District is not in compliance with the Uniform Guidance and Georgia Department of Education guidance. Recommendation: The School District should develop and maintain equipment listings that reflect all required information, including a description, an identifying number, the source of funding, the title holder, the acquisition date, the cost, the percentage of Federal participation in the project costs, the location, the use and condition, and any ultimate disposal data for each piece of equipment. In addition, management should implement controls to ensure that a complete physical inventory of equipment is performed for every Federal program, and the results are reconciled back to the equipment listings at least once every two years. Views of Responsible Officials: We concur with this finding.
FA 2022-001 Improve Controls over Equipment Compliance Requirement: Equipment and Real Property Management Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Agriculture Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: 10.553 – School Breakfast Program 10.555 – National School Lunch Program Federal Award Number: 225GA324N1199 Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: COVID-19 – 84.425D – Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425U – American Rescue Plan Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425W – American Rescue Plan Elementary and Secondary School Emergency Relief Fund – Homeless Children and Youth Federal Award Numbers: S425D200012 (Year: 2020), S425D210012 (Year: 2021) S425U210012 (Year: 2021), S425W210011 (Year: 2021) Questioned Costs: None Identified Repeat of Prior Year Finding: FA 2021-001, FA 2020-001, FA 2019-003, FA 2018-002, FA 2017-004 Description: The policies and procedures of the School District were insufficient to provide adequate internal controls over equipment and real property management as it relates to the Child Nutrition Cluster and Elementary and Secondary School Emergency Relief Fund programs. Background: The Child Nutrition Cluster (CNC) is comprised of various programs that are intended to assist states in administering and overseeing food service program operators that provide healthful, nutritious meals to eligible children in public and non-profit private schools, residential child care institutions, and summer programs. This Cluster of programs also fosters healthy eating habits in children by providing fresh fruits and fresh vegetables to children attending elementary and secondary schools and encourages the domestic consumption of nutritious agricultural commodities. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. The CARES Act was designed to mitigate the economic effects of the COVID-19 pandemic in a variety of ways, including providing additional funding for local educational agencies (LEAs) navigating the impact of the COVID-19 outbreak. Provisions included in Title VIII of the CARES Act created the Education Stabilization Fund to provide financial resources to educational entities to prevent, prepare for, and respond to coronavirus. The CARES Act allocated $30.75 billion, the Coronavirus Response and Relief Supplemental Appropriations Act allocated an additional $81.9 billion, and the American Rescue Plan Act added $165.1 billion in funding to the Education Stabilization Fund. Multiple Education Stabilization Fund subprograms were created and allotted funding through the various COVID-19-related legislation. Of these programs, the Elementary and Secondary School Emergency Relief (ESSER) Fund was created to address the impact that COVID-19 has had, and continues to have, on elementary and secondary schools across the nation. CNC and ESSER funding was granted to the Georgia Department of Education (GDOE) by the U.S. Department of Agriculture and U.S. Department of Education (ED), respectively. GDOE is responsible for distributing funds to LEAs and overseeing the programs. CNC funds totaling $1,113,376.14 and ESSER funds totaling $3,586,443.78 were expended and reported on the Dooly County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Provisions included in the Uniform Guidance, Section 200.313(d)(1) state, "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." In addition, the Uniform Guidance, Section 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." Condition: The following deficiencies were noted when reviewing the CNC and ESSER equipment listings and physically locating equipment items: • Property records did not include the following required components for CNC equipment items: (1) Percentage of Federal participation in the project costs for the Federal award under which the property was acquired, (2) the source of funding for the property (including the FAIN), and (3) who holds title. • Property records did not include the following required components for Elementary and Secondary School Emergency Relief Fund equipment items: (1) Percentage of Federal participation in the project costs for the Federal award under which the property was acquired, (2) who holds title, and (3) use and condition of the property. • An equipment item totaling $501,596.61 purchased using ESSER funds was included on the financial statement capital asset listing but was excluded from the program equipment listing. Cause: In discussing this deficiency with the School District, they stated these issues were a result of turnover within the Central Office. In addition, the ESSER equipment item was overlooked when preparing the program equipment listing. Effect: Failure to maintain a complete and accurate equipment listing and reconcile results of the physical inventory performed to the property records exposes the School District to unnecessary risk of error and misuse of equipment and/or Federal funds. Additionally, the School District is not in compliance with the Uniform Guidance and Georgia Department of Education guidance. Recommendation: The School District should develop and maintain equipment listings that reflect all required information, including a description, an identifying number, the source of funding, the title holder, the acquisition date, the cost, the percentage of Federal participation in the project costs, the location, the use and condition, and any ultimate disposal data for each piece of equipment. In addition, management should implement controls to ensure that a complete physical inventory of equipment is performed for every Federal program, and the results are reconciled back to the equipment listings at least once every two years. Views of Responsible Officials: We concur with this finding.
FA 2022-001 Improve Controls over Equipment Compliance Requirement: Equipment and Real Property Management Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Agriculture Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: 10.553 – School Breakfast Program 10.555 – National School Lunch Program Federal Award Number: 225GA324N1199 Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: COVID-19 – 84.425D – Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425U – American Rescue Plan Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425W – American Rescue Plan Elementary and Secondary School Emergency Relief Fund – Homeless Children and Youth Federal Award Numbers: S425D200012 (Year: 2020), S425D210012 (Year: 2021) S425U210012 (Year: 2021), S425W210011 (Year: 2021) Questioned Costs: None Identified Repeat of Prior Year Finding: FA 2021-001, FA 2020-001, FA 2019-003, FA 2018-002, FA 2017-004 Description: The policies and procedures of the School District were insufficient to provide adequate internal controls over equipment and real property management as it relates to the Child Nutrition Cluster and Elementary and Secondary School Emergency Relief Fund programs. Background: The Child Nutrition Cluster (CNC) is comprised of various programs that are intended to assist states in administering and overseeing food service program operators that provide healthful, nutritious meals to eligible children in public and non-profit private schools, residential child care institutions, and summer programs. This Cluster of programs also fosters healthy eating habits in children by providing fresh fruits and fresh vegetables to children attending elementary and secondary schools and encourages the domestic consumption of nutritious agricultural commodities. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. The CARES Act was designed to mitigate the economic effects of the COVID-19 pandemic in a variety of ways, including providing additional funding for local educational agencies (LEAs) navigating the impact of the COVID-19 outbreak. Provisions included in Title VIII of the CARES Act created the Education Stabilization Fund to provide financial resources to educational entities to prevent, prepare for, and respond to coronavirus. The CARES Act allocated $30.75 billion, the Coronavirus Response and Relief Supplemental Appropriations Act allocated an additional $81.9 billion, and the American Rescue Plan Act added $165.1 billion in funding to the Education Stabilization Fund. Multiple Education Stabilization Fund subprograms were created and allotted funding through the various COVID-19-related legislation. Of these programs, the Elementary and Secondary School Emergency Relief (ESSER) Fund was created to address the impact that COVID-19 has had, and continues to have, on elementary and secondary schools across the nation. CNC and ESSER funding was granted to the Georgia Department of Education (GDOE) by the U.S. Department of Agriculture and U.S. Department of Education (ED), respectively. GDOE is responsible for distributing funds to LEAs and overseeing the programs. CNC funds totaling $1,113,376.14 and ESSER funds totaling $3,586,443.78 were expended and reported on the Dooly County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Provisions included in the Uniform Guidance, Section 200.313(d)(1) state, "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." In addition, the Uniform Guidance, Section 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." Condition: The following deficiencies were noted when reviewing the CNC and ESSER equipment listings and physically locating equipment items: • Property records did not include the following required components for CNC equipment items: (1) Percentage of Federal participation in the project costs for the Federal award under which the property was acquired, (2) the source of funding for the property (including the FAIN), and (3) who holds title. • Property records did not include the following required components for Elementary and Secondary School Emergency Relief Fund equipment items: (1) Percentage of Federal participation in the project costs for the Federal award under which the property was acquired, (2) who holds title, and (3) use and condition of the property. • An equipment item totaling $501,596.61 purchased using ESSER funds was included on the financial statement capital asset listing but was excluded from the program equipment listing. Cause: In discussing this deficiency with the School District, they stated these issues were a result of turnover within the Central Office. In addition, the ESSER equipment item was overlooked when preparing the program equipment listing. Effect: Failure to maintain a complete and accurate equipment listing and reconcile results of the physical inventory performed to the property records exposes the School District to unnecessary risk of error and misuse of equipment and/or Federal funds. Additionally, the School District is not in compliance with the Uniform Guidance and Georgia Department of Education guidance. Recommendation: The School District should develop and maintain equipment listings that reflect all required information, including a description, an identifying number, the source of funding, the title holder, the acquisition date, the cost, the percentage of Federal participation in the project costs, the location, the use and condition, and any ultimate disposal data for each piece of equipment. In addition, management should implement controls to ensure that a complete physical inventory of equipment is performed for every Federal program, and the results are reconciled back to the equipment listings at least once every two years. Views of Responsible Officials: We concur with this finding.
FA 2022-001 Improve Controls over Equipment Compliance Requirement: Equipment and Real Property Management Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Agriculture Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: 10.553 – School Breakfast Program 10.555 – National School Lunch Program Federal Award Number: 225GA324N1199 Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education AL Numbers and Titles: COVID-19 – 84.425D – Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425U – American Rescue Plan Elementary and Secondary School Emergency Relief Fund COVID-19 – 84.425W – American Rescue Plan Elementary and Secondary School Emergency Relief Fund – Homeless Children and Youth Federal Award Numbers: S425D200012 (Year: 2020), S425D210012 (Year: 2021) S425U210012 (Year: 2021), S425W210011 (Year: 2021) Questioned Costs: None Identified Repeat of Prior Year Finding: FA 2021-001, FA 2020-001, FA 2019-003, FA 2018-002, FA 2017-004 Description: The policies and procedures of the School District were insufficient to provide adequate internal controls over equipment and real property management as it relates to the Child Nutrition Cluster and Elementary and Secondary School Emergency Relief Fund programs. Background: The Child Nutrition Cluster (CNC) is comprised of various programs that are intended to assist states in administering and overseeing food service program operators that provide healthful, nutritious meals to eligible children in public and non-profit private schools, residential child care institutions, and summer programs. This Cluster of programs also fosters healthy eating habits in children by providing fresh fruits and fresh vegetables to children attending elementary and secondary schools and encourages the domestic consumption of nutritious agricultural commodities. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. The CARES Act was designed to mitigate the economic effects of the COVID-19 pandemic in a variety of ways, including providing additional funding for local educational agencies (LEAs) navigating the impact of the COVID-19 outbreak. Provisions included in Title VIII of the CARES Act created the Education Stabilization Fund to provide financial resources to educational entities to prevent, prepare for, and respond to coronavirus. The CARES Act allocated $30.75 billion, the Coronavirus Response and Relief Supplemental Appropriations Act allocated an additional $81.9 billion, and the American Rescue Plan Act added $165.1 billion in funding to the Education Stabilization Fund. Multiple Education Stabilization Fund subprograms were created and allotted funding through the various COVID-19-related legislation. Of these programs, the Elementary and Secondary School Emergency Relief (ESSER) Fund was created to address the impact that COVID-19 has had, and continues to have, on elementary and secondary schools across the nation. CNC and ESSER funding was granted to the Georgia Department of Education (GDOE) by the U.S. Department of Agriculture and U.S. Department of Education (ED), respectively. GDOE is responsible for distributing funds to LEAs and overseeing the programs. CNC funds totaling $1,113,376.14 and ESSER funds totaling $3,586,443.78 were expended and reported on the Dooly County Board of Education’s Schedule of Expenditures of Federal Awards (SEFA) for fiscal year 2022. Criteria: As a recipient of federal awards, the School District is required to establish and maintain effective internal control over federal awards that provides reasonable assurance of managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards pursuant to Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), Section 200.303 – Internal Controls. Provisions included in the Uniform Guidance, Section 200.313(d)(1) state, "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." In addition, the Uniform Guidance, Section 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." Condition: The following deficiencies were noted when reviewing the CNC and ESSER equipment listings and physically locating equipment items: • Property records did not include the following required components for CNC equipment items: (1) Percentage of Federal participation in the project costs for the Federal award under which the property was acquired, (2) the source of funding for the property (including the FAIN), and (3) who holds title. • Property records did not include the following required components for Elementary and Secondary School Emergency Relief Fund equipment items: (1) Percentage of Federal participation in the project costs for the Federal award under which the property was acquired, (2) who holds title, and (3) use and condition of the property. • An equipment item totaling $501,596.61 purchased using ESSER funds was included on the financial statement capital asset listing but was excluded from the program equipment listing. Cause: In discussing this deficiency with the School District, they stated these issues were a result of turnover within the Central Office. In addition, the ESSER equipment item was overlooked when preparing the program equipment listing. Effect: Failure to maintain a complete and accurate equipment listing and reconcile results of the physical inventory performed to the property records exposes the School District to unnecessary risk of error and misuse of equipment and/or Federal funds. Additionally, the School District is not in compliance with the Uniform Guidance and Georgia Department of Education guidance. Recommendation: The School District should develop and maintain equipment listings that reflect all required information, including a description, an identifying number, the source of funding, the title holder, the acquisition date, the cost, the percentage of Federal participation in the project costs, the location, the use and condition, and any ultimate disposal data for each piece of equipment. In addition, management should implement controls to ensure that a complete physical inventory of equipment is performed for every Federal program, and the results are reconciled back to the equipment listings at least once every two years. Views of Responsible Officials: We concur with this finding.
FINDING 2023-003 Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. A property record or capital asset listing, which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number (FAIN)), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property, is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. The School Corporation paid for various pieces of equipment with Education Stabilization Funds that exceeded the capitalization threshold. Although these assets were added to a detailed listing of capital assets, the assets were added as a lump sum amount, instead of by individual piece of equipment. Additionally, the records did not include 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, and the use and condition of the property. The lack of internal controls and noncompliance were systemic issued 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)(1) states: "Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, 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 A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, assets purchased in whole or in part with federal dollars did not denote whether federal funds were used to acquire the asset. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure asset records include all the necessary information and new assets are added individually. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-003 Subject: COVID-19 - Education Stabilization Fund - Equipment and Real Property Management Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. A property record or capital asset listing, which would include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number (FAIN)), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, and use and condition of the property, is to be maintained for assets purchased that exceed the School Corporation's capitalization threshold. The School Corporation paid for various pieces of equipment with Education Stabilization Funds that exceeded the capitalization threshold. Although these assets were added to a detailed listing of capital assets, the assets were added as a lump sum amount, instead of by individual piece of equipment. Additionally, the records did not include 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, and the use and condition of the property. The lack of internal controls and noncompliance were systemic issued 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)(1) states: "Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, 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 A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, assets purchased in whole or in part with federal dollars did not denote whether federal funds were used to acquire the asset. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure asset records include all the necessary information and new assets are added individually. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.