SPECIAL EDUCATION CLUSTER (IDEA) – 84.027, 84.173 Federal Awarding Agency: U.S. Department of Agriculture (USDA) Federal Award Fiscal Year: 2024 Federal Award Numbers: HO27A220054-22A, H173A220057 Administered by: Rhode Island Department of Elementary and Secondary Education (RIDE) Compliance Requirement: Subrecipient Monitoring SUBRECIPIENT MONITORING The Department of Education (RIDE) has not implemented adequate subrecipient monitoring activities to ensure compliance with federal regulations. Background: The State relies on grantee agencies to perform subrecipient monitoring, when required, and ensure compliance with federal regulations. There is no statewide monitoring of subrecipient activities to ensure compliance with federal regulations. RIDE performs its subrecipient monitoring through the review of audit reports, desk reviews and performing site visits deemed high risk. High-risk subrecipients are determined through the review of audit reports, completion of a desk review checklist, and the completion of an annual survey completed by the subrecipients then scored by RIDE. Criteria: Federal regulations 2 CFR §200.329, require Pass Through Entities (PTE), such as the State, to monitor grant subrecipients to ensure that federal funds are spent appropriately. Federal Regulation 2 CFR §200.332 Subpart B requires that the PTE provide subrecipients with clear grant information, including grant terms, required financial reporting, and audit requirements. Per 2 CFR § 200.328, PTEs must collect financial data from subrecipients no less than annually. Condition: We identified some deficiencies in internal controls relating to subrecipient monitoring during our audit. Deficiencies included a lack of required monitoring documentation (e.g., annual surveys, Single Audit Reports) submitted by subrecipients and failure by RIDE to appropriately consider these deficiencies within their consideration of subrecipient risk. Of the 65 subrecipients receiving $55.3 million, we selected 25 subrecipients for testing and found 4 subrecipients with control deficiencies that prevented RIDE from complying with the subrecipient monitoring requirement as follows: • RIDE was unable to provide documentation supporting grant award information communicated to one subrecipient. Additionally, the required risk assessment for the Special Education Cluster was not performed for this subrecipient. • RIDE was unable to provide the completed Desk Review checklist for 3 subrecipients. These 3 subrecipients also did not complete RIDE’s required annual survey. We found that the lack of annual survey completion did not result in RIDE assessing higher risk for one subrecipient and thus no site visit was performed. The other 2 subrecipients were assessed at high risk, however, no site visit was performed for these subrecipients. • A subrecipient did not submit its fiscal year 2022 and 2023 Single Audit Reports and RIDE did not modify its risk assessment accordingly. RIDE was also unable to provide documentation supporting its follow-up (i.e., meeting discussing the submission of the Single Audit Report) with the subrecipients. Additionally, RIDE’s risk assessment was not adequate to identify this subrecipient as high risk. Internal controls over subrecipient monitoring would be improved by 1) updating subrecipients’ risk assessments when they fail to comply with documentation requirements, and 2) implementing monitoring procedures to identify instances where RIDE’s monitoring is not consistent with the risk assessed. Implementing site visits when subrecipients do not comply with documentation requirements would ensure that monitoring procedures align with the risk associated with the subrecipient. Cause: Lack of adequate dedicated agency resources and insufficient controls to ensure compliance with federal requirements. Effect: Noncompliance with federal compliance requirements by subrecipients could occur without being identified by the State in a timely manner. Questioned Costs: None Valid Statistical Sampling: Not Applicable RECOMMENDATION 2024-047 Improve internal controls over subrecipient monitoring by 1) updating subrecipients’ risk assessments when they fail to comply with documentation requirements, and 2) implementing monitoring procedures to identify instances where RIDE’s monitoring is not consistent with the risk assessed.
Federal Program Name: COVID-19 - Education Stabilization Fund Federal Agency: Department of Education Federal Assistance Listing Title and Number: COVID-19 - Education Stabilization Fund, 84.425U Criteria or Specific Requirement: Reporting - CFR Part 200.302(b) states, “The financial management system of each non-Federal entity must provide for accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329." This is a repeat finding from the prior year (2023-002). Condition: An effective internal control system was not in place at the School Corporation to ensure compliance with federal requirements related to the reporting compliance requirements. (Other Instance of Noncompliance and Deficiency) Questioned Costs: None noted Context: The School Corporation submitted one ESSER III report where the expenses per the report did not tie to the ledger or the Schedule of Expenditures of Federal Awards by approximately $300,000. Effect: The ESSER III report was not supported by the School Corporation’s financial records. Cause: The School Corporation’s internal controls were not applied to the reporting process that required retention of documentation originally used to prepare the financial portion of the ESSER III report.. Recommendation: Management should establish a proper system of internal controls and strengthen its policies and procedures to ensure all reports submitted on behalf of the Education Stabilization Fund program funds are accurate and are reconciled to the School Corporation’s financial records. Views of Responsible Officials and Planned Corrective Action: The District notes the finding as presented. See Corrective Action Plan prepared by management Persons responsible for implementing: Matthew Miles, CFO Anticipated completion date: July 15, 2025.
Condition: During our audit of the Abandoned Mine Land and Reclamation Program, we noted that the submission of the quarterly SF-425 Federal Financial Reports was not completed within 30 days after the reporting period end date. Context: The SF-425 Federal Financial Reports for the four quarters of fiscal year 2024 were not submitted by their respective deadlines of 30 days after the reporting period end date. All fiscal year 2024 reports were filed in April 2025. Criteria: 2 C.F.R. § 1000.10 gives regulatory effect to the Department of Treasury for 2 C.F.R. § 200.328, which establishes requirements over federal reporting, and states: Unless otherwise approved by OMB, the Federal awarding agency must solicit only the OMB-approved governmentwide data elements for collection of financial information at time of publication the Federal Financial Report or such future, OMB-approved, governmentwide data elements available from the OMB-designated standards lead. This information must be collected with the frequency required by the terms and conditions of the Federal award, but no less frequently than annually nor more frequently than quarterly except in unusual circumstances, for example where more frequent reporting is necessary for the effective monitoring of the Federal award or could significantly affect program outcomes, and preferably in coordination with performance reporting. The Federal awarding agency must use OMB approved common information collections, as applicable, when providing financial and performance reporting information. 2 C.F.R. § 1000.10 gives regulatory effect to the Department of Treasury for 2 C.F.R. § 200.329(b), which establishes requirements over federal reporting, and states: Reporting program performance. The Federal awarding agency must use OMB-approved common information collections, as applicable, when providing financial and performance reporting information. As appropriate and in accordance with above mentioned information collections, the Federal awarding agency must require the recipient to relate financial data and accomplishments to performance goals and objectives of the Federal award. Also, in accordance with above mentioned common information collections, and when required by the terms and conditions of the Federal award, recipients must provide cost information to demonstrate cost effective practices (e.g., through unit cost data). In some instances (e.g., discretionary research awards), this will be limited to the requirement to submit technical performance reports (to be evaluated in accordance with Federal awarding agency policy). Reporting requirements must be clearly articulated such that, where appropriate, performance during the execution of the Federal award has a standard against which non-Federal entity performance can be measured. It is management's responsibility to implement internal control procedures to reasonably ensure the federal reports they submit are accurate, complete, and in compliance with program requirements. It is imperative that management be able to provide the underlying data and related program documentation required to prepare and support these reports. The Town’s management is responsible for the preparation of the quarterly SF-425 Federal Financial Report, as required by 2 C.F.R. § 200.328. Questioned Costs: $0 Cause: The Town did not have adequate controls in place to ensure the quarterly SF-425 Federal Financial Reports, were submitted within 30 days after the reporting period end date. Effect: The SF-425 Federal Financial Reports were not submitted by their respective deadlines of 30 days after the reporting period end date. Recommendation: We recommend the Town review these regulations and comply with the provisions set forth therein. A policy should be established to ensure that each SF-425 Federal Financial Report is submitted by its due date of 30 days after the reporting period end date. Management should periodically review these procedures to ensure they are operating as intended. Response: Management stated they have established a policy to ensure each quarterly report is submitted by its due date.
CONDITION: The District did not properly record its federal program expenditures for the ESSER and ARP ESER federal grant programs using the various funding source expenditure codes as prescribed by the Chart of Accounts for PA Local Educational Agencies maintained by the PA Office of the Budget, Office of Comptroller Operations and well as Section 2 CFR 200.302(a) of the Uniform Guidance. This is a repeat finding from (2023-003) from the previous fiscal year. CRITERIA: The financial management system of the District must provide for 1) identification in it’s accounts, of all Federal awards received and expended and the Federal programs under which they were received, and 2) accurate, current and complete disclosure of the financial results of each federal award or program in accordance with the reporting requirements set forth in sections 200.328 and 200.329 of the Uniform Guidance. EFFECT: The District was not in compliance with the financial reporting requirements in the Chart of Accounts for PA Local Educational Agencies maintained by the PA Office of the Budget, Office of Comptroller Operations and well as Section 2 CFR 200.302(a) of the Uniform Guidance. CAUSE: The District experienced turnover in key business office personnel during the last three fiscal years, which resulted in errors in posting federal expenditures to the appropriate general ledger account codes. This further lead to inaccurate reporting as outlined above. QUESTIONED COST: None RECOMMENDATION: I recommend that the District properly follow the guidance contained within the PA Office of the Budget, Office of Comptroller Operations Chart of Accounts for recording all expenditures of the District, most specifically, federal program grant expenditures to 1) enhance internal controls for tracking and monitoring federal program expenditures and 2) comply with the recordkeeping requirements for federal funds as specified in 2 CFR Part 200 of the Uniform Guidance and PDE regulations. VIEW OF RESPONSIBLE OFFICIALS: See Correction Action Plan
CONDITION: The District did not properly record its federal program expenditures for the ESSER and ARP ESER federal grant programs using the various funding source expenditure codes as prescribed by the Chart of Accounts for PA Local Educational Agencies maintained by the PA Office of the Budget, Office of Comptroller Operations and well as Section 2 CFR 200.302(a) of the Uniform Guidance. This is a repeat finding from (2023-003) from the previous fiscal year. CRITERIA: The financial management system of the District must provide for 1) identification in it’s accounts, of all Federal awards received and expended and the Federal programs under which they were received, and 2) accurate, current and complete disclosure of the financial results of each federal award or program in accordance with the reporting requirements set forth in sections 200.328 and 200.329 of the Uniform Guidance. EFFECT: The District was not in compliance with the financial reporting requirements in the Chart of Accounts for PA Local Educational Agencies maintained by the PA Office of the Budget, Office of Comptroller Operations and well as Section 2 CFR 200.302(a) of the Uniform Guidance. CAUSE: The District experienced turnover in key business office personnel during the last three fiscal years, which resulted in errors in posting federal expenditures to the appropriate general ledger account codes. This further lead to inaccurate reporting as outlined above. QUESTIONED COST: None RECOMMENDATION: I recommend that the District properly follow the guidance contained within the PA Office of the Budget, Office of Comptroller Operations Chart of Accounts for recording all expenditures of the District, most specifically, federal program grant expenditures to 1) enhance internal controls for tracking and monitoring federal program expenditures and 2) comply with the recordkeeping requirements for federal funds as specified in 2 CFR Part 200 of the Uniform Guidance and PDE regulations. VIEW OF RESPONSIBLE OFFICIALS: See Correction Action Plan
CONDITION: The District did not properly record its federal program expenditures for the ESSER and ARP ESER federal grant programs using the various funding source expenditure codes as prescribed by the Chart of Accounts for PA Local Educational Agencies maintained by the PA Office of the Budget, Office of Comptroller Operations and well as Section 2 CFR 200.302(a) of the Uniform Guidance. This is a repeat finding from (2023-003) from the previous fiscal year. CRITERIA: The financial management system of the District must provide for 1) identification in it’s accounts, of all Federal awards received and expended and the Federal programs under which they were received, and 2) accurate, current and complete disclosure of the financial results of each federal award or program in accordance with the reporting requirements set forth in sections 200.328 and 200.329 of the Uniform Guidance. EFFECT: The District was not in compliance with the financial reporting requirements in the Chart of Accounts for PA Local Educational Agencies maintained by the PA Office of the Budget, Office of Comptroller Operations and well as Section 2 CFR 200.302(a) of the Uniform Guidance. CAUSE: The District experienced turnover in key business office personnel during the last three fiscal years, which resulted in errors in posting federal expenditures to the appropriate general ledger account codes. This further lead to inaccurate reporting as outlined above. QUESTIONED COST: None RECOMMENDATION: I recommend that the District properly follow the guidance contained within the PA Office of the Budget, Office of Comptroller Operations Chart of Accounts for recording all expenditures of the District, most specifically, federal program grant expenditures to 1) enhance internal controls for tracking and monitoring federal program expenditures and 2) comply with the recordkeeping requirements for federal funds as specified in 2 CFR Part 200 of the Uniform Guidance and PDE regulations. VIEW OF RESPONSIBLE OFFICIALS: See Correction Action Plan
Finding 2024-003 – Reporting Federal Agency: U.S. Department of Treasury Federal Program Name: COVID-19 – Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No.: No. 21.027 Federal Award Number: ASST_NON_SLFRP0137_2001 Grant Award Period: 9/1/2022 – 8/31/2024 Pass Through Entity: Los Angeles County - Department of Public Health Repeat Finding: No Statistically Valid Sample: The sample was not intended to be, and was not, a statistically valid sample Criteria As set forth in 2 CFR 200.328 and in 31 CFR Section 35.4(c), entities receiving Coronavirus State and Local Fiscal Recovery Funds are required to submit quarterly and annually project and expenditure reports to meet compliance and reporting responsibilities under the program. As the Foundation is a subrecipient to the County of Los Angeles (the County), section 6.2 and section 7.0 of Exhibit A of the Agreement between the County and the Foundation for American Rescue Plan Act Trauma Prevention Partnerships provides the reporting requirements by the Foundation to the County including, among other things, the expenditures reported to date by the Foundation. 2 CFR 200.303 requires the recipient of federal funds 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. Condition/Context During fiscal the fiscal year ending June 30, 2024, the Foundation overstated expenditures incurred by its two vendors by $203,629 and a corresponding overstatement of $20,363 in indirect costs in the schedule of expenditures of federal awards (SEFA). Additionally, in the June 30, 2024 Quarterly Performance Report to the County, the Foundation overstated the advances to its vendors by $120,000 and understated expenditures incurred by its two vendors by $519,259. Finally, in the June 30, 2024 Quarterly Invoice to the County, the Foundation overstated the amounts advances to its vendors by $120,000 (however the remaining $807,000 of advances were correctly reported.) Management also failed to separately report the actual expenditures incurred by the vendors in the "Contracts" section of the invoice. However, in the total invoiced amount summarized in the invoice for fiscal 2024 approximated the total expenditures on the June 30, 2024 schedule of expenditures of federal awards. Based on our discussion with management, we understand that the Foundation and the County mutually understood that the June 30, 2024 quarterly invoice was preliminary, as it was submitted by CCF prior to the fiscal year-end. Consequently, the Foundation reflected the final expenditures and payments in the September 30, 2024 invoice. In this invoice, the Foundation removed the previously overstated amount of $120,000 of advances to a vendor. Cause The Foundation had reported all of the amounts advanced to its two vendors in the SEFA and in its quarterly reporting to the County with the understanding that those amounts were the actual expenditures incurred by the vendors during the year. Additionally, there were not sufficient controls in place to ensure that the amounts reported in the SEFA and June 30, 2024 quarterly performance report submitted to the County reconciled to the actual expenditures incurred by the Foundation’s vendors for the year ending June 30, 2024. Effect or Potential Effect The expenditures reported in the schedule of expenditures of federal awards for the year ended June 30, 2024 and in quarterly reporting to the County were incorrect. Questioned Costs None noted. Auditors’ Recommendation We recommend that the Foundation strengthen its reconciliation controls between the amounts reported in the SEFA and County invoices to ensure the amounts are accurate and consistently reported. Views of Responsible Officials CCF acknowledges the finding and is implementing corrective measures to strengthen the accuracy and integrity of its financial and programmatic reporting. CCF has enhanced its internal review process and implemented a reconciliation protocol to ensure consistency between internal records and external reports. Finance staff have received additional training, and final reports are now subject to dual validation by both the Compliance and Finance teams prior to submission.
SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE – PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION - TITLE i GRANTS TO LOCAL EDUCATION AGENCIES FUNDS (FEDERAL ALN 84.010) 2024-005 Internal Control Over Compliance With Federal Reimbursement Submission Deadline Requirements Criteria – 2 CFR § 200.328 requires the Academy to establish and maintain effective internal control over compliance with requirements applicable to federal program reporting, including reimbursement submission requirements applicable to Title I grants. Condition – During our audit, we noted the Academy did not have sufficient controls in place within its Title I federal program to ensure compliance with federal reporting requirements. Questioned Costs – Not applicable. Context – During our testing, we noted for one request for reimbursement, the Academy did not submit the requrest to the MDE by the required deadline. This was not a statistically valid sample. Repeat Finding – This is a current year finding. Cause – This was an oversight by academy personnel. Effect – Noncompliance with reimbursement submission deadline requirements may lead to the Academy not receiving reimbursement in a timely manner or at all. Recommendation – We recommend that the Academy review its internal control procedures relating to reimbursement submission for the Title I program. Internal controls over compliance for this area should include documentation of submission policies and the Uniform Guidance requirements related to submission deadlines. These controls should also include steps to ensure any expenditure with which the Academy expects reimbursement to be submitted in a timely manner. View of Responsible Official and Planned Corrective Actions – The Academy agrees with the finding. The Academy will review and update its policies and procedures relating to reimbursement submission for its federal programs to ensure compliance with the Uniform Guidance in the future. The Academy has separately issued a Corrective Action Plan related to this finding.
AL number: 16.540 AL title: Juvenile Justice and Delinquency Prevention Federal award identification number and year: BSCC 892-22 7/1/2023 - 6/30/2024 Name of federal agency: U.S. Department of Justice Name of pass-through entity: Office of Youth and Community Restoration Repeat finding: No Criteria: According to the OMB Compliance Supplement and 2 CFR § 200.328, nonfederal entities must submit performance and financial reports as required by the terms and conditions of the federal award. These reports must be accurate, complete, and submitted timely, typically on a quarterly or annual basis as specified by the awarding agency. Condition: During our testing, we noted that the Organization submitted a quarterly report beyond the due date established in the award agreement. In addition, the Organization was unable to provide evidence that one quarterly report was submitted. Cause: The Organization lacks a formal internal control to track federal reporting deadlines and ensure timely submission. Effect or potential effect: Late submission of required federal reports may result in noncompliance with award conditions and could impact the Organization’s eligibility for future funding or trigger increased monitoring by the awarding agency. Recommendation: We recommend that the Organization implement a centralized compliance calendar to track all federal reporting deadlines and assign responsibility for preparation and timely submission. Management should also implement a review process to ensure that all reports are accurate and submitted in accordance with federal requirements.
. Reporting Finding Number: 2024-002 Assistance Listing Number and Title COVID-19 Coronavirus State and Local Fiscal Recovery Funds – AL #21.027 Federal Award Identification Number / Year: 2024 Federal Agency: U.S. Department of Treasury Compliance Requirement: Reporting Pass-Through Entity: Ohio Facilities Construction Commission Repeat Finding from Prior Audit? No Noncompliance and Material Weakness 2 CFR 1000.10 gives regulatory effect to the U.S. Department of Treasury for 2 CFR § 200.328 through 200.330 which describe specific procedures non-Federal entities must follow for performance and financial monitoring and reporting of Federal funds. 2 CFR § 200.328 states unless otherwise approved by OMB, the Federal awarding agency must solicit only the OMB-approved governmentwide data elements for collection of financial information (at time of publication the Federal Financial Report or such future, OMB-approved, governmentwide data elements available from the OMB-designated standards lead). This information must be collected with the frequency required by the terms and conditions of the Federal award, but no less frequently than annually nor more frequently than quarterly except in unusual circumstances. The Federal awarding agency must use OMB approved common information collections, as applicable, when providing financial and performance reporting information. The District's grant agreement states that the grantee agrees to comply with any reporting obligations established by Treasury, as it relates to this award. Grantee also agrees to comply with any reporting requirements established by the Grantor, the Office of Budget and Management, or the State of Ohio, as it relates to this award. The Grantor has established a reporting workbook that is to be completed for each quarter the District reports. The reporting workbook includes four tabs, two of which are required to be completed for each reporting submission. During testing, the following errors in the completion of the reporting workbook were identified due to a deficient internal control structure: • Two of the District's quarterly reports were improperly certified. • Two of the District's quarterly reports inaccurately presented program expenditures. Failure to properly submit quarterly reports could result in Ohio Facilities Construction Commission taking action against the District for failure to comply with programmatic requirements. The District should implement policies and procedures to review the reports prior to submission to help ensure the reports are complete and accurate.
2024-006 —Reporting – Significant Deficiency in Internal Control Over Compliance and Noncompliance (Repeat of Finding 2023-007, 2022-005, 2021-002, and 2020-004) Federal program information: Funding agencies: U.S. Department of Interior and U.S. Department of Education Titles: Assistance to Tribally Controlled Community Colleges; Higher Education Institutional Aid; and Education Stabilization Fund ALN Number: 15.027, 84.031, 84.425 Award years: Various Criteria: According to 2 CFR Section 200.328, nonfederal entities may be required to submit performance reports at least annually as required by the terms of the federal award. In addition, ALN 84.425 requires quarterly expenditure and budget reports. Condition: The College did not submit annual performance reports on time for three programs. The annual report for ALN 84.031 was inaccurate. In addition, two quarterly financial reports required for ALN 84.425 were not submitted timely. Cause: The College did not have sufficient procedures in place to ensure that the reports were completed timely and accurately. Effect: The three annual reports and two quarterly reports examined were submitted after the required time and one report was inaccurate. Questioned Costs: None Context: The annual reports and two quarterly reports were not submitted timely, and one report was not accurate. Recommendation: The College should ensure that all grant reports are prepared in a timely manner and are accurate. Management’s Response: The College will submit annual performance reports in a timely manner.
2024-006 —Reporting – Significant Deficiency in Internal Control Over Compliance and Noncompliance (Repeat of Finding 2023-007, 2022-005, 2021-002, and 2020-004) Federal program information: Funding agencies: U.S. Department of Interior and U.S. Department of Education Titles: Assistance to Tribally Controlled Community Colleges; Higher Education Institutional Aid; and Education Stabilization Fund ALN Number: 15.027, 84.031, 84.425 Award years: Various Criteria: According to 2 CFR Section 200.328, nonfederal entities may be required to submit performance reports at least annually as required by the terms of the federal award. In addition, ALN 84.425 requires quarterly expenditure and budget reports. Condition: The College did not submit annual performance reports on time for three programs. The annual report for ALN 84.031 was inaccurate. In addition, two quarterly financial reports required for ALN 84.425 were not submitted timely. Cause: The College did not have sufficient procedures in place to ensure that the reports were completed timely and accurately. Effect: The three annual reports and two quarterly reports examined were submitted after the required time and one report was inaccurate. Questioned Costs: None Context: The annual reports and two quarterly reports were not submitted timely, and one report was not accurate. Recommendation: The College should ensure that all grant reports are prepared in a timely manner and are accurate. Management’s Response: The College will submit annual performance reports in a timely manner.
2024-006 —Reporting – Significant Deficiency in Internal Control Over Compliance and Noncompliance (Repeat of Finding 2023-007, 2022-005, 2021-002, and 2020-004) Federal program information: Funding agencies: U.S. Department of Interior and U.S. Department of Education Titles: Assistance to Tribally Controlled Community Colleges; Higher Education Institutional Aid; and Education Stabilization Fund ALN Number: 15.027, 84.031, 84.425 Award years: Various Criteria: According to 2 CFR Section 200.328, nonfederal entities may be required to submit performance reports at least annually as required by the terms of the federal award. In addition, ALN 84.425 requires quarterly expenditure and budget reports. Condition: The College did not submit annual performance reports on time for three programs. The annual report for ALN 84.031 was inaccurate. In addition, two quarterly financial reports required for ALN 84.425 were not submitted timely. Cause: The College did not have sufficient procedures in place to ensure that the reports were completed timely and accurately. Effect: The three annual reports and two quarterly reports examined were submitted after the required time and one report was inaccurate. Questioned Costs: None Context: The annual reports and two quarterly reports were not submitted timely, and one report was not accurate. Recommendation: The College should ensure that all grant reports are prepared in a timely manner and are accurate. Management’s Response: The College will submit annual performance reports in a timely manner.
2024-006 —Reporting – Significant Deficiency in Internal Control Over Compliance and Noncompliance (Repeat of Finding 2023-007, 2022-005, 2021-002, and 2020-004) Federal program information: Funding agencies: U.S. Department of Interior and U.S. Department of Education Titles: Assistance to Tribally Controlled Community Colleges; Higher Education Institutional Aid; and Education Stabilization Fund ALN Number: 15.027, 84.031, 84.425 Award years: Various Criteria: According to 2 CFR Section 200.328, nonfederal entities may be required to submit performance reports at least annually as required by the terms of the federal award. In addition, ALN 84.425 requires quarterly expenditure and budget reports. Condition: The College did not submit annual performance reports on time for three programs. The annual report for ALN 84.031 was inaccurate. In addition, two quarterly financial reports required for ALN 84.425 were not submitted timely. Cause: The College did not have sufficient procedures in place to ensure that the reports were completed timely and accurately. Effect: The three annual reports and two quarterly reports examined were submitted after the required time and one report was inaccurate. Questioned Costs: None Context: The annual reports and two quarterly reports were not submitted timely, and one report was not accurate. Recommendation: The College should ensure that all grant reports are prepared in a timely manner and are accurate. Management’s Response: The College will submit annual performance reports in a timely manner.
2024-006 —Reporting – Significant Deficiency in Internal Control Over Compliance and Noncompliance (Repeat of Finding 2023-007, 2022-005, 2021-002, and 2020-004) Federal program information: Funding agencies: U.S. Department of Interior and U.S. Department of Education Titles: Assistance to Tribally Controlled Community Colleges; Higher Education Institutional Aid; and Education Stabilization Fund ALN Number: 15.027, 84.031, 84.425 Award years: Various Criteria: According to 2 CFR Section 200.328, nonfederal entities may be required to submit performance reports at least annually as required by the terms of the federal award. In addition, ALN 84.425 requires quarterly expenditure and budget reports. Condition: The College did not submit annual performance reports on time for three programs. The annual report for ALN 84.031 was inaccurate. In addition, two quarterly financial reports required for ALN 84.425 were not submitted timely. Cause: The College did not have sufficient procedures in place to ensure that the reports were completed timely and accurately. Effect: The three annual reports and two quarterly reports examined were submitted after the required time and one report was inaccurate. Questioned Costs: None Context: The annual reports and two quarterly reports were not submitted timely, and one report was not accurate. Recommendation: The College should ensure that all grant reports are prepared in a timely manner and are accurate. Management’s Response: The College will submit annual performance reports in a timely manner.
2024-007 —Financial Reporting– Significant Deficiency in Internal Control Over Compliance and Noncompliance Federal program information: Funding agencies: U.S. Department of Education Titles: SFA Cluster-Federal Pell Grant Program ALN Number: 84.063 Award years: 2024 Criteria: According to 2 CFR Section 200.328, nonfederal entities may be required to submit financial reports at least annually as required by the terms of the federal award. In addition, the grant requires origination and disbursement records be submitted to the Common Origination and Disbursement (COD) system. Condition: The College did not submit disbursement records for students as required. Cause: The College was affected by a ransomware attack that restricted access from their system in order to submit the disbursement records to the COD system. Effect: The College is not in compliance with reporting requirements. Questioned Costs: None Context: Disbursement records were not reported for fall 2023 to the COD system. Recommendation: Work with Department of Education to report the disbursement records for the time period not reported to the COD system. Management’s Response: The College will submit disbursement records to the COD system as required.
2 CFR 200.328 states, in part, (c) the recipient or subrecipient must submit financial reports as required by the Federal award. Reports submitted annually by the recipient or subrecipient must be due no later than 90 calendar days after the reporting period. Reports submitted quarterly or semiannually must be due no later than 30 calendar days after the reporting period. (d) The final financial report submitted by the recipient must be due no later than 120 calendar days after the conclusion of the period of performance. A subrecipient must submit a final financial report to a pass-through entity no later than 90 calendar days after the conclusion of the period of performance. See also § 200.344. The Federal agency or pass-through entity may extend the due date for any financial report with justification from the recipient or subrecipient. Further, 2 CFR 200.502(a) states that the determination of when a Federal award is expended must be based on when the activity related to the Federal award occurs. We noted that the District filed its FY23 final expenditure report by the required deadline. However, the District claimed $476,752 more in expenditures on the final expenditure report than they had identified in eligible expenditures for the program. The District reclassified $476,752 in ESSER expenditures from the general fund into the ESSER fund after the reporting deadline. We noted that this determination was made after the obligation period had ended and without an extension request being made to the pass-through agency, Ohio Department of Education and Workforce (ODEW) to extend the due date. Further, the ESSER expenditures adjusted from the general fund did not align with the object codes budgeted with ODEW through the Comprehensive Continuous Improvement Plan and reported on the final expenditure report. Additionally, system reports originally filed with ODEW along with the final expenditure report did not accurately reflect the expenditures ultimately claimed for the program. We recommend that the District adopt proper procedures to ensure that reported expenditures on the final expenditure report are accurate and obligated by the appropriate deadline. Requests to extend the due date of the reporting requirement should be made when necessary. Further, expenditures should only be made for objects budgeted and approved by ODEW. In instances where reclassifications are made to program expenditures, the District should ensure that revisions to previously submitted reports are made, when necessary.
2024-004 – Reporting Required by the Uniform Grant Guidance Finding Type. Significant Deficiency in Internal Control over Compliance and Immaterial Noncompliance (Reporting) Program. COVID-19 State and Local Fiscal Recovery Funds Cluster (CFDA# 21.027); U.S. Department of Treasury; Passed through State of Oregon Department of Administrative Services. Criteria. Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR sections 200.328 through 200.329. Condition. The District did not submit quarterly reports in compliance with 2 CFR sections 200.328 through 200.329. Cause. The District did not submit quarterly reports in compliance with grant requirements as no internal controls were in place to ensure compliance was maintained. Effect. As a result of this condition, the District did not fully comply with 2 CFR Part 200. Questioned Costs. No costs have been questioned as a result of this finding. Recommendation. We recommend that the District establish internal controls associated with grant reporting requirements to ensure compliance is maintained. View of Responsible Officials. We agree with the recommendation and will develop procedures to comply with the Uniform Guidance applicable to grants
Finding 2024-003 Improper Revenue Recognition (Material Weakness) Assistance Listing Number and Title: 84.010 Title I Name of Federal Agency: U.S. Department of Education Assistance Listing Number and Title: 10.553 and 10.555 National School Lunch Breakfast and Lunch Name of Federal Agency: U.S. Department of Agriculture Criteria: Management is responsible for establishing and maintaining effective internal control over financial report-ing. Internal controls should allow management or employees in the normal course of performing their assigned func-tions to prevent or detect material misstatements in the financial reporting of all district funds. 2 CFR Part 200.302(b)(1) The financial management system of each non-federal entity must provide for the following: Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. 200.302(b)(2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in 200.328 and 200.329. Condition: During our audit, it was noted that revenue from certain grant-funded programs was not accurately recog-nized between state and federal sources. Specifically: • Some payments of federal revenue was recorded as state revenue, and some payments of state revenue was rec-orded as federal revenue. • In some cases, revenue was not recognized in the correct reporting period. This caused under recognition of current year federal revenue, and grant reimbursement to be therefore to be claimed in duplicate. Cause: Lack of clear procedures for distinguishing and recording revenue streams for blended funding sources. Internal controls to prevent, detect and correct accounting entries for grant revenues were weak or nonexistent allowing errors in reporting of revenues, overclaiming of federal revenues, and distinguishing revenue between state and federal sources. The lack of timely recognition of revenues caused the overclaiming of Title I. The accounting records were retroactively revised during the audit, for federal award and other reporting purposes. Dis-trict management did not have sufficient training or monitoring policies to recognize and correct the deficiency during the fiscal year. Effect or Potential Effect: Not accurately recording transactions timely into the general ledger, may result in transac-tions not being properly reported in the district’s financial statements and the ability to rely on the general ledger for correct and timely information. This may cause misstatement of financial statements, and inappropriate reporting of federal awards. Questioned Cost: No Context: Due to improper recording of financial activity, Title I grant revenues were overclaimed, and general ledger required adjustment for proper state and federal presentation of grant revenues for National School Lunch Program. Repeat of a Prior-Year Finding: No. Recommendation: We recommend that Willamina School District implement accounting staff training programs, and implement a standardized revenue recognition policy that clearly distinguishes between state and federal funding sources. Additionally, we recommend that a reconciliation process be established to ensure all federal, state and matching funds are recorded timely and accurately. District's Response: The District concurs with the recommendation. Corrective Action Plan: The District will provide training for staff in order to devise and implement appropriate poli-cies and procedures for accurately recording all financial transactions, including federal award revenues and expendi-tures. Additional internal control policies will be adopted and procedures implemented as on-going improvement efforts are made. Planned Implementation Date: August 1, 2025 Responsible Person: District Business Manager
Finding 2024-003 Improper Revenue Recognition (Material Weakness) Assistance Listing Number and Title: 84.010 Title I Name of Federal Agency: U.S. Department of Education Assistance Listing Number and Title: 10.553 and 10.555 National School Lunch Breakfast and Lunch Name of Federal Agency: U.S. Department of Agriculture Criteria: Management is responsible for establishing and maintaining effective internal control over financial report-ing. Internal controls should allow management or employees in the normal course of performing their assigned func-tions to prevent or detect material misstatements in the financial reporting of all district funds. 2 CFR Part 200.302(b)(1) The financial management system of each non-federal entity must provide for the following: Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. 200.302(b)(2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in 200.328 and 200.329. Condition: During our audit, it was noted that revenue from certain grant-funded programs was not accurately recog-nized between state and federal sources. Specifically: • Some payments of federal revenue was recorded as state revenue, and some payments of state revenue was rec-orded as federal revenue. • In some cases, revenue was not recognized in the correct reporting period. This caused under recognition of current year federal revenue, and grant reimbursement to be therefore to be claimed in duplicate. Cause: Lack of clear procedures for distinguishing and recording revenue streams for blended funding sources. Internal controls to prevent, detect and correct accounting entries for grant revenues were weak or nonexistent allowing errors in reporting of revenues, overclaiming of federal revenues, and distinguishing revenue between state and federal sources. The lack of timely recognition of revenues caused the overclaiming of Title I. The accounting records were retroactively revised during the audit, for federal award and other reporting purposes. Dis-trict management did not have sufficient training or monitoring policies to recognize and correct the deficiency during the fiscal year. Effect or Potential Effect: Not accurately recording transactions timely into the general ledger, may result in transac-tions not being properly reported in the district’s financial statements and the ability to rely on the general ledger for correct and timely information. This may cause misstatement of financial statements, and inappropriate reporting of federal awards. Questioned Cost: No Context: Due to improper recording of financial activity, Title I grant revenues were overclaimed, and general ledger required adjustment for proper state and federal presentation of grant revenues for National School Lunch Program. Repeat of a Prior-Year Finding: No. Recommendation: We recommend that Willamina School District implement accounting staff training programs, and implement a standardized revenue recognition policy that clearly distinguishes between state and federal funding sources. Additionally, we recommend that a reconciliation process be established to ensure all federal, state and matching funds are recorded timely and accurately. District's Response: The District concurs with the recommendation. Corrective Action Plan: The District will provide training for staff in order to devise and implement appropriate poli-cies and procedures for accurately recording all financial transactions, including federal award revenues and expendi-tures. Additional internal control policies will be adopted and procedures implemented as on-going improvement efforts are made. Planned Implementation Date: August 1, 2025 Responsible Person: District Business Manager
Finding 2024-003 Improper Revenue Recognition (Material Weakness) Assistance Listing Number and Title: 84.010 Title I Name of Federal Agency: U.S. Department of Education Assistance Listing Number and Title: 10.553 and 10.555 National School Lunch Breakfast and Lunch Name of Federal Agency: U.S. Department of Agriculture Criteria: Management is responsible for establishing and maintaining effective internal control over financial report-ing. Internal controls should allow management or employees in the normal course of performing their assigned func-tions to prevent or detect material misstatements in the financial reporting of all district funds. 2 CFR Part 200.302(b)(1) The financial management system of each non-federal entity must provide for the following: Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. 200.302(b)(2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in 200.328 and 200.329. Condition: During our audit, it was noted that revenue from certain grant-funded programs was not accurately recog-nized between state and federal sources. Specifically: • Some payments of federal revenue was recorded as state revenue, and some payments of state revenue was rec-orded as federal revenue. • In some cases, revenue was not recognized in the correct reporting period. This caused under recognition of current year federal revenue, and grant reimbursement to be therefore to be claimed in duplicate. Cause: Lack of clear procedures for distinguishing and recording revenue streams for blended funding sources. Internal controls to prevent, detect and correct accounting entries for grant revenues were weak or nonexistent allowing errors in reporting of revenues, overclaiming of federal revenues, and distinguishing revenue between state and federal sources. The lack of timely recognition of revenues caused the overclaiming of Title I. The accounting records were retroactively revised during the audit, for federal award and other reporting purposes. Dis-trict management did not have sufficient training or monitoring policies to recognize and correct the deficiency during the fiscal year. Effect or Potential Effect: Not accurately recording transactions timely into the general ledger, may result in transac-tions not being properly reported in the district’s financial statements and the ability to rely on the general ledger for correct and timely information. This may cause misstatement of financial statements, and inappropriate reporting of federal awards. Questioned Cost: No Context: Due to improper recording of financial activity, Title I grant revenues were overclaimed, and general ledger required adjustment for proper state and federal presentation of grant revenues for National School Lunch Program. Repeat of a Prior-Year Finding: No. Recommendation: We recommend that Willamina School District implement accounting staff training programs, and implement a standardized revenue recognition policy that clearly distinguishes between state and federal funding sources. Additionally, we recommend that a reconciliation process be established to ensure all federal, state and matching funds are recorded timely and accurately. District's Response: The District concurs with the recommendation. Corrective Action Plan: The District will provide training for staff in order to devise and implement appropriate poli-cies and procedures for accurately recording all financial transactions, including federal award revenues and expendi-tures. Additional internal control policies will be adopted and procedures implemented as on-going improvement efforts are made. Planned Implementation Date: August 1, 2025 Responsible Person: District Business Manager
Finding 2024-003 Improper Revenue Recognition (Material Weakness) Assistance Listing Number and Title: 84.010 Title I Name of Federal Agency: U.S. Department of Education Assistance Listing Number and Title: 10.553 and 10.555 National School Lunch Breakfast and Lunch Name of Federal Agency: U.S. Department of Agriculture Criteria: Management is responsible for establishing and maintaining effective internal control over financial report-ing. Internal controls should allow management or employees in the normal course of performing their assigned func-tions to prevent or detect material misstatements in the financial reporting of all district funds. 2 CFR Part 200.302(b)(1) The financial management system of each non-federal entity must provide for the following: Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. 200.302(b)(2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in 200.328 and 200.329. Condition: During our audit, it was noted that revenue from certain grant-funded programs was not accurately recog-nized between state and federal sources. Specifically: • Some payments of federal revenue was recorded as state revenue, and some payments of state revenue was rec-orded as federal revenue. • In some cases, revenue was not recognized in the correct reporting period. This caused under recognition of current year federal revenue, and grant reimbursement to be therefore to be claimed in duplicate. Cause: Lack of clear procedures for distinguishing and recording revenue streams for blended funding sources. Internal controls to prevent, detect and correct accounting entries for grant revenues were weak or nonexistent allowing errors in reporting of revenues, overclaiming of federal revenues, and distinguishing revenue between state and federal sources. The lack of timely recognition of revenues caused the overclaiming of Title I. The accounting records were retroactively revised during the audit, for federal award and other reporting purposes. Dis-trict management did not have sufficient training or monitoring policies to recognize and correct the deficiency during the fiscal year. Effect or Potential Effect: Not accurately recording transactions timely into the general ledger, may result in transac-tions not being properly reported in the district’s financial statements and the ability to rely on the general ledger for correct and timely information. This may cause misstatement of financial statements, and inappropriate reporting of federal awards. Questioned Cost: No Context: Due to improper recording of financial activity, Title I grant revenues were overclaimed, and general ledger required adjustment for proper state and federal presentation of grant revenues for National School Lunch Program. Repeat of a Prior-Year Finding: No. Recommendation: We recommend that Willamina School District implement accounting staff training programs, and implement a standardized revenue recognition policy that clearly distinguishes between state and federal funding sources. Additionally, we recommend that a reconciliation process be established to ensure all federal, state and matching funds are recorded timely and accurately. District's Response: The District concurs with the recommendation. Corrective Action Plan: The District will provide training for staff in order to devise and implement appropriate poli-cies and procedures for accurately recording all financial transactions, including federal award revenues and expendi-tures. Additional internal control policies will be adopted and procedures implemented as on-going improvement efforts are made. Planned Implementation Date: August 1, 2025 Responsible Person: District Business Manager
Finding 2024-003 Improper Revenue Recognition (Material Weakness) Assistance Listing Number and Title: 84.010 Title I Name of Federal Agency: U.S. Department of Education Assistance Listing Number and Title: 10.553 and 10.555 National School Lunch Breakfast and Lunch Name of Federal Agency: U.S. Department of Agriculture Criteria: Management is responsible for establishing and maintaining effective internal control over financial report-ing. Internal controls should allow management or employees in the normal course of performing their assigned func-tions to prevent or detect material misstatements in the financial reporting of all district funds. 2 CFR Part 200.302(b)(1) The financial management system of each non-federal entity must provide for the following: Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. 200.302(b)(2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in 200.328 and 200.329. Condition: During our audit, it was noted that revenue from certain grant-funded programs was not accurately recog-nized between state and federal sources. Specifically: • Some payments of federal revenue was recorded as state revenue, and some payments of state revenue was rec-orded as federal revenue. • In some cases, revenue was not recognized in the correct reporting period. This caused under recognition of current year federal revenue, and grant reimbursement to be therefore to be claimed in duplicate. Cause: Lack of clear procedures for distinguishing and recording revenue streams for blended funding sources. Internal controls to prevent, detect and correct accounting entries for grant revenues were weak or nonexistent allowing errors in reporting of revenues, overclaiming of federal revenues, and distinguishing revenue between state and federal sources. The lack of timely recognition of revenues caused the overclaiming of Title I. The accounting records were retroactively revised during the audit, for federal award and other reporting purposes. Dis-trict management did not have sufficient training or monitoring policies to recognize and correct the deficiency during the fiscal year. Effect or Potential Effect: Not accurately recording transactions timely into the general ledger, may result in transac-tions not being properly reported in the district’s financial statements and the ability to rely on the general ledger for correct and timely information. This may cause misstatement of financial statements, and inappropriate reporting of federal awards. Questioned Cost: No Context: Due to improper recording of financial activity, Title I grant revenues were overclaimed, and general ledger required adjustment for proper state and federal presentation of grant revenues for National School Lunch Program. Repeat of a Prior-Year Finding: No. Recommendation: We recommend that Willamina School District implement accounting staff training programs, and implement a standardized revenue recognition policy that clearly distinguishes between state and federal funding sources. Additionally, we recommend that a reconciliation process be established to ensure all federal, state and matching funds are recorded timely and accurately. District's Response: The District concurs with the recommendation. Corrective Action Plan: The District will provide training for staff in order to devise and implement appropriate poli-cies and procedures for accurately recording all financial transactions, including federal award revenues and expendi-tures. Additional internal control policies will be adopted and procedures implemented as on-going improvement efforts are made. Planned Implementation Date: August 1, 2025 Responsible Person: District Business Manager
Finding 2024-003 Improper Revenue Recognition (Material Weakness) Assistance Listing Number and Title: 84.010 Title I Name of Federal Agency: U.S. Department of Education Assistance Listing Number and Title: 10.553 and 10.555 National School Lunch Breakfast and Lunch Name of Federal Agency: U.S. Department of Agriculture Criteria: Management is responsible for establishing and maintaining effective internal control over financial report-ing. Internal controls should allow management or employees in the normal course of performing their assigned func-tions to prevent or detect material misstatements in the financial reporting of all district funds. 2 CFR Part 200.302(b)(1) The financial management system of each non-federal entity must provide for the following: Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. 200.302(b)(2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in 200.328 and 200.329. Condition: During our audit, it was noted that revenue from certain grant-funded programs was not accurately recog-nized between state and federal sources. Specifically: • Some payments of federal revenue was recorded as state revenue, and some payments of state revenue was rec-orded as federal revenue. • In some cases, revenue was not recognized in the correct reporting period. This caused under recognition of current year federal revenue, and grant reimbursement to be therefore to be claimed in duplicate. Cause: Lack of clear procedures for distinguishing and recording revenue streams for blended funding sources. Internal controls to prevent, detect and correct accounting entries for grant revenues were weak or nonexistent allowing errors in reporting of revenues, overclaiming of federal revenues, and distinguishing revenue between state and federal sources. The lack of timely recognition of revenues caused the overclaiming of Title I. The accounting records were retroactively revised during the audit, for federal award and other reporting purposes. Dis-trict management did not have sufficient training or monitoring policies to recognize and correct the deficiency during the fiscal year. Effect or Potential Effect: Not accurately recording transactions timely into the general ledger, may result in transac-tions not being properly reported in the district’s financial statements and the ability to rely on the general ledger for correct and timely information. This may cause misstatement of financial statements, and inappropriate reporting of federal awards. Questioned Cost: No Context: Due to improper recording of financial activity, Title I grant revenues were overclaimed, and general ledger required adjustment for proper state and federal presentation of grant revenues for National School Lunch Program. Repeat of a Prior-Year Finding: No. Recommendation: We recommend that Willamina School District implement accounting staff training programs, and implement a standardized revenue recognition policy that clearly distinguishes between state and federal funding sources. Additionally, we recommend that a reconciliation process be established to ensure all federal, state and matching funds are recorded timely and accurately. District's Response: The District concurs with the recommendation. Corrective Action Plan: The District will provide training for staff in order to devise and implement appropriate poli-cies and procedures for accurately recording all financial transactions, including federal award revenues and expendi-tures. Additional internal control policies will be adopted and procedures implemented as on-going improvement efforts are made. Planned Implementation Date: August 1, 2025 Responsible Person: District Business Manager
2024-003 U.S. Department of the Treasury COVID-19 – Coronavirus State and Local Fiscal Recovery Funds - ALN 21.027 Significant Deficiency in Internal Controls Over Compliance Criteria: Per 2 CFR section 200.328 of the Uniform Guidance, each recipient must report program outlays and program income on a cash or accrual basis, as prescribed by the federal awarding agency. The compliance supplement identifies four Key Line Items required to be reported to the federal awarding agency which include (1) current period obligation, (2) cumulative obligation, (3) current period expenditure and (4) cumulative expenditure. An obligation is an order placed for property and services and entering into contracts, subawards, and similar transactions that require payment. Condition: As of the March 31, 2024, reporting date, the Town reported project amounts voted by the Select Board as obligated rather than purchases, contracts and agreements that met the Federal criteria of an obligation. Cause: The Town did not interpret the reporting requirements of the award properly. Effect: The Town’s reporting for obligations were overstated by approximately $520,000. Questioned Costs: None Repeat Finding from Prior Year: No Recommendation: The Town should implement procedures to reconcile the financial information in the Project and Expenditure reports to the Town’s contract and purchasing files before submission. Views of Responsible Official: Management agrees with the finding.
2024-003 U.S. Department of the Treasury COVID-19 – Coronavirus State and Local Fiscal Recovery Funds - ALN 21.027 Significant Deficiency in Internal Controls Over Compliance Criteria: Per 2 CFR section 200.328 of the Uniform Guidance, each recipient must report program outlays and program income on a cash or accrual basis, as prescribed by the federal awarding agency. The compliance supplement identifies four Key Line Items required to be reported to the federal awarding agency which include (1) current period obligation, (2) cumulative obligation, (3) current period expenditure and (4) cumulative expenditure. An obligation is an order placed for property and services and entering into contracts, subawards, and similar transactions that require payment. Condition: As of the March 31, 2024, reporting date, the Town reported project amounts voted by the Select Board as obligated rather than purchases, contracts and agreements that met the Federal criteria of an obligation. Cause: The Town did not interpret the reporting requirements of the award properly. Effect: The Town’s reporting for obligations were overstated by approximately $520,000. Questioned Costs: None Repeat Finding from Prior Year: No Recommendation: The Town should implement procedures to reconcile the financial information in the Project and Expenditure reports to the Town’s contract and purchasing files before submission. Views of Responsible Official: Management agrees with the finding.
2024-006 Report Submission Delay Program: 21.027 Coronavirus State and Local Fiscal Recovery Funds Criteria: In accordance with 2 CFR 200.328, non-Federal entities must submit financial reports at the interval required by the Federal awarding agency or pass-through entity no later than the specified due date. If a justified request is submitted by a non-Federal entity, the Federal entity may extend the due date for any financial report. Condition: Two monthly financial reports were submitted after the stated due date. Cause: Monthly reports were generated prior to the due date, but were not reviewed and approved by the deadline for submission. Effect: Reports were not submitted to the grantor in a timely manner and requests for extension of the due date were not made. Questioned Costs: The conditions did not result in questioned costs greater than $25,000. Context: In both instances, the reports were submitted within 5 days of the stated due date. Repeat Finding: No. Recommendation: Reports should be generated sooner to allow time for sufficient review and approval before the due date. When timely submission may not be possible, UAS should request an extension from the grantor by providing a notice of the delay and rationale for the late report, and, if approved, submit the report by the extended deadline. When extensions are not granted, UAS should submit reports by the initial stated due date. Views of Responsible Officials: Management agrees with the finding and a response is included in the corrective action plan.
2024-006 Report Submission Delay Program: 21.027 Coronavirus State and Local Fiscal Recovery Funds Criteria: In accordance with 2 CFR 200.328, non-Federal entities must submit financial reports at the interval required by the Federal awarding agency or pass-through entity no later than the specified due date. If a justified request is submitted by a non-Federal entity, the Federal entity may extend the due date for any financial report. Condition: Two monthly financial reports were submitted after the stated due date. Cause: Monthly reports were generated prior to the due date, but were not reviewed and approved by the deadline for submission. Effect: Reports were not submitted to the grantor in a timely manner and requests for extension of the due date were not made. Questioned Costs: The conditions did not result in questioned costs greater than $25,000. Context: In both instances, the reports were submitted within 5 days of the stated due date. Repeat Finding: No. Recommendation: Reports should be generated sooner to allow time for sufficient review and approval before the due date. When timely submission may not be possible, UAS should request an extension from the grantor by providing a notice of the delay and rationale for the late report, and, if approved, submit the report by the extended deadline. When extensions are not granted, UAS should submit reports by the initial stated due date. Views of Responsible Officials: Management agrees with the finding and a response is included in the corrective action plan.
2024-006 Report Submission Delay Program: 21.027 Coronavirus State and Local Fiscal Recovery Funds Criteria: In accordance with 2 CFR 200.328, non-Federal entities must submit financial reports at the interval required by the Federal awarding agency or pass-through entity no later than the specified due date. If a justified request is submitted by a non-Federal entity, the Federal entity may extend the due date for any financial report. Condition: Two monthly financial reports were submitted after the stated due date. Cause: Monthly reports were generated prior to the due date, but were not reviewed and approved by the deadline for submission. Effect: Reports were not submitted to the grantor in a timely manner and requests for extension of the due date were not made. Questioned Costs: The conditions did not result in questioned costs greater than $25,000. Context: In both instances, the reports were submitted within 5 days of the stated due date. Repeat Finding: No. Recommendation: Reports should be generated sooner to allow time for sufficient review and approval before the due date. When timely submission may not be possible, UAS should request an extension from the grantor by providing a notice of the delay and rationale for the late report, and, if approved, submit the report by the extended deadline. When extensions are not granted, UAS should submit reports by the initial stated due date. Views of Responsible Officials: Management agrees with the finding and a response is included in the corrective action plan.
2024-006 Report Submission Delay Program: 21.027 Coronavirus State and Local Fiscal Recovery Funds Criteria: In accordance with 2 CFR 200.328, non-Federal entities must submit financial reports at the interval required by the Federal awarding agency or pass-through entity no later than the specified due date. If a justified request is submitted by a non-Federal entity, the Federal entity may extend the due date for any financial report. Condition: Two monthly financial reports were submitted after the stated due date. Cause: Monthly reports were generated prior to the due date, but were not reviewed and approved by the deadline for submission. Effect: Reports were not submitted to the grantor in a timely manner and requests for extension of the due date were not made. Questioned Costs: The conditions did not result in questioned costs greater than $25,000. Context: In both instances, the reports were submitted within 5 days of the stated due date. Repeat Finding: No. Recommendation: Reports should be generated sooner to allow time for sufficient review and approval before the due date. When timely submission may not be possible, UAS should request an extension from the grantor by providing a notice of the delay and rationale for the late report, and, if approved, submit the report by the extended deadline. When extensions are not granted, UAS should submit reports by the initial stated due date. Views of Responsible Officials: Management agrees with the finding and a response is included in the corrective action plan.
2024 – 003 – Reporting Grantor: Department of Health and Human Services Passthrough Agency: N/A Program Name: Community Project Funding/Congressionally Directed Spending - Construction Award Name: Congressional Directives Award Year: 2024 Award Number: 6 CE1HS47194-01-10 Assistance Listing Number: 93.493 Criteria 2 CFR 200.328 requires non-Federal entities to submit financial reports as required by the Federal award. Condition Per the award agreement, the Federal Financial Report for the period of September 1, 2022 to August 31, 2023 was required to be submitted before January 30, 2024. Through our testing of the reporting over the Congressional Directives award, we selected the one Federal Financial Report (“FFR”) required to be issued in FY24, which was for the period of September 1, 2022 to August 31, 2023. For the one selection tested, the Alliance did not submit the Federal Financial Report prior to the due date of January 30, 2024. The Alliance could not provide additional supporting documentation indicating there was any pre-approval or acknowledgement for submitting reports late as is required per the award agreement. Cause For the selection tested, the Alliance noted that there was a delay in setting up an authorized employee with the appropriate system access due to the internal review requirements for new users. As the delay in receiving employee’s clearance continued, another Alliance employee (an approved analyst) filed the FFR on February 5, 2024, after being requested to do so. Effect The Alliance did not submit the FFR within the appropriate period per the award agreement, within the due date of January 30, 2024. Therefore, the Alliance was not in compliance with reporting requirements. Questioned Costs None noted. Recommendation The Alliance should ensure that timely submission of reports is performed as stated within agreed-upon award agreements with Department of Health and Human Services. Management’s Views and Corrective Action Plan Please refer to the Alliance’s Management’s Views and Corrective Action Plan included at the end of this report for additional details.
FINDING 2024-003 Information on the federal program: Subject: COVID-19 – Education Stabilization Fund – Reporting Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 Financial reporting . . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Condition: An effective internal control system was not in place at the School District in order to ensure compliance with requirements related to the grant agreement and the Reporting compliance requirements. Cause: The School District's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. Effect: The failure to establish an effective internal control system placed the School District at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. Questioned Costs: There were no questioned costs identified. Context: The School Corporation had not designed nor implemented a system of internal control to ensure that the annual Elementary and Secondary School Emergency Relief (ESSER) annual Data Collection reports (Reports) were complete and accurately submitted. The reports were prepared and submitted in JotForm, the online application used by the Indiana Department of Education to collect information, without an oversight or secondary review process in place to prevent, or detect and correct, errors. During tie out of the Year 3 report, a variance between the underlying records and reported expenditures of $187,649 was noted due to the lack of effective controls surrounding annual data reporting. 84.425U expenditures submitted within the Year 3 report were overstated by $187,649. Identification as a repeat finding: Yes, see Finding 2022-001. Recommendation: We recommend someone other than the preparer of the report perform a documented, secondary review of the report information prior to submission to validate the accuracy and completeness of the data submitted. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
2024-001 Internal Control over Compliance and Compliance with Reporting (Preparation of the Schedule of Expenditures of Federal Awards (SEFA)) Information on the Major Federal Programs: Department of Housing and Urban Development Federal Assistance Listing Number: 14.218 Federal Assistance Listing Name: Community Development Block Grants/Entitlement Grants Grant Number: CV-2-8 Department of Health and Human Services Federal Assistance Listing Number: 93.566 Federal Assistance Listing Name: Refugee and Entrant Assistance - State-Administered Programs Grant Number: JA-FSA-RSS-2022 Criteria: Title 2 U.S. Code of Federal Regulations Part 200 (2 CFR part 200) Section §200.510(b) states in part: “The auditee must also prepare a schedule of expenditures of Federal awards for the period covered by the auditee’s financial statements which must include the total Federal awards expended as determined in accordance with CFR Section §200.502 Basis for determining Federal awards expended.” The schedule must provide total federal awards expended for each individual Federal program. In accordance with §200.302 Financial Management, a non-Federal entity's financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award. The financial management system of each non-Federal entity must provide for the following: (1) Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §200.327 Financial Reporting and §200.328 Monitoring and Reporting Program Performance. (3) Records that identify adequately the source and application of funds for Federally-funded activities. (4) Effective control over, and accountability for, all funds, property, and other assets.
2024-001 Internal Control over Compliance and Compliance with Reporting (Preparation of the Schedule of Expenditures of Federal Awards (SEFA)) Information on the Major Federal Programs: Department of Housing and Urban Development Federal Assistance Listing Number: 14.218 Federal Assistance Listing Name: Community Development Block Grants/Entitlement Grants Grant Number: CV-2-8 Department of Health and Human Services Federal Assistance Listing Number: 93.566 Federal Assistance Listing Name: Refugee and Entrant Assistance - State-Administered Programs Grant Number: JA-FSA-RSS-2022 Criteria: Title 2 U.S. Code of Federal Regulations Part 200 (2 CFR part 200) Section §200.510(b) states in part: “The auditee must also prepare a schedule of expenditures of Federal awards for the period covered by the auditee’s financial statements which must include the total Federal awards expended as determined in accordance with CFR Section §200.502 Basis for determining Federal awards expended.” The schedule must provide total federal awards expended for each individual Federal program. In accordance with §200.302 Financial Management, a non-Federal entity's financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award. The financial management system of each non-Federal entity must provide for the following: (1) Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §200.327 Financial Reporting and §200.328 Monitoring and Reporting Program Performance. (3) Records that identify adequately the source and application of funds for Federally-funded activities. (4) Effective control over, and accountability for, all funds, property, and other assets.
2024-001 Internal Control over Compliance and Compliance with Reporting (Preparation of the Schedule of Expenditures of Federal Awards (SEFA)) Information on the Major Federal Programs: Department of Housing and Urban Development Federal Assistance Listing Number: 14.218 Federal Assistance Listing Name: Community Development Block Grants/Entitlement Grants Grant Number: CV-2-8 Department of Health and Human Services Federal Assistance Listing Number: 93.566 Federal Assistance Listing Name: Refugee and Entrant Assistance - State-Administered Programs Grant Number: JA-FSA-RSS-2022 Criteria: Title 2 U.S. Code of Federal Regulations Part 200 (2 CFR part 200) Section §200.510(b) states in part: “The auditee must also prepare a schedule of expenditures of Federal awards for the period covered by the auditee’s financial statements which must include the total Federal awards expended as determined in accordance with CFR Section §200.502 Basis for determining Federal awards expended.” The schedule must provide total federal awards expended for each individual Federal program. In accordance with §200.302 Financial Management, a non-Federal entity's financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award. The financial management system of each non-Federal entity must provide for the following: (1) Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §200.327 Financial Reporting and §200.328 Monitoring and Reporting Program Performance. (3) Records that identify adequately the source and application of funds for Federally-funded activities. (4) Effective control over, and accountability for, all funds, property, and other assets.
2024-001 Reporting Federal agency: U.S Department of Commerce Federal program title: Investments for Public Works and Economic Development Facilities Assistant Listing Number: 11.300 Federal Award Identification Number: 05-79-06232 - 2024 Award Period: July 1, 2023 to June 30, 2024 Type of Finding: Compliance, Other Matters Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: Uniform Grant Guidance (2 CFR 200.303) requires nonfederal entities receiving Federal awards establish and maintain internal controls designed to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements. Effective internal controls should include procedures to ensure reports are formally reviewed by someone who did not prepare the report to verify the correct information and data is submitted. Additionally, per 2 CFR 200.328(c) the recipient or subrecipient must submit financial reports as required by the Federal award. Reports submitted annually by the recipient or subrecipient must be due no later than 90 calendar days after the reporting period. Reports submitted quarterly or semiannually must be due no later than 30 calendar days after the reporting period. Condition: The College did not have a formal review process in place as well as submit report timely. Context: During our testing, we identified 2 out of 2 financial reports did not have documentation of formal review. Additionally, 1 of the 2 reports was not submitted within the required timeframe. Questioned costs: None. Cause: Supervisory review and approval is currently undocumented, and is only communicated verbally. Effect: Improper data could be submitted to the awarding agency. Repeat Finding: No. Recommendation: The College should implement formal review procedures to document review and approvals over required reports in addition to procedures to ensure reports are being submitted timely. Views of responsible officials: Management agrees with the finding.
Federal Program: U.S. Department of Commerce-ALN 11.307, Urban Agriculture Mapping and CEDS Integration Criteria: 2 CFR 200.302 requires that non-federal entities must provide for the accurate, current, and complete disclosure of financial results for each Federal award or program in accordance with the reporting requirements set forth in 2 CFR section 200.328 Condition/Context: During our testing, we reviewed the semi-annual and final federal financial report and noted that the semi-annual federal financial report due on October 31, 2023, was submitted on November 13, 2023. Cause: The Board did not have adequate policies and procedures in place to allow all federal financial reporting to occur timely. Effect: The Board is not in compliance with reporting requirements. Questioned Cost: None Recommendation: The Board should enhance it policies and procedures to ensure that all future reports are submitted timely. Views of responsible officials: Management agrees with the finding and the Auditors’ recommendation. See Corrective Action Plan at the end of the report.
Finding Number: 2024-001 Federal Program: YouthBuild Grants Federal Award Identification Number and Year: YB-38198-22-60-A-39, 2024 Assistance Listing Number (ALN): 17.274 Federal Awarding Agency: U.S. Department of Labor Compliance Requirement: Reporting – Quarterly Financial Reports Pass-through Entity: N/A Repeat Finding: No Significant Deficiency and Noncompliance – Timely Submission of Quarterly Financial Reports Criteria: 2 C.F.R. § 200.328 Financial Reporting states, in part, the Federal agency or pass-through entity must collect financial reports no less than annually. The Federal agency or pass-through entity may not collect financial reports more frequently than quarterly unless a specific condition has been implemented in accordance with § 200.208. To the extent practicable, the Federal agency or pass-through entity should collect financial reports in coordination with performance reports. The recipient must submit financial reports as required by the Federal award. In the YouthBuild Grant Condition of Award, U.S. Department of Labor, Section 12 Administrative Requirements, Part L, Reports, Section A, Quarterly Financial Reports, all ETA grant award recipients are required to report financial data on the ETA-9130 Financial Report. ETA-9130 reports are due no later than 45 calendar days after the end of each specified reporting quarter. Condition: The School did not submit the quarter ending December 31, 2023 ETA-9130 Quarterly Financial Report until February 20, 2024, six days after the deadline of February 14, 2024. Questioned Costs: None. Identification of How Questioned Costs Were Computed: N/A Context: Auditor reviewed the ETA-9130 Quarterly Financial Report for period ending December 31, 2023 via submission through the U.S. Department of Labor’s Payment Management System, and noted the School did not submit the report until February 20, 2024, which was six days after the deadline of February 14, 2024. Cause and Effect: The School did not have procedures in place to review and submit the ETA-9130 Quarterly Financial Report timely. As a result, the School filed the Quarter Ending December 31, 2023 ETA-9130 Quarterly Financial Report after the required due date. Recommendation: We recommend that the School implement a process to ensure that future Quarterly Financial Reports are filed by the required due date. Views of Responsible Officials and Corrective Action Plan: See Corrective Action Plan.
FINDING 2024-003 Information on the federal program: Subject: Education Stabilization Fund (ESSER) – Internal Controls Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D210013, S425U200013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 Financial reporting . . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Reporting compliance requirements. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. FINDING 2024-003 (Continued) Questioned Costs: There were no questioned costs identified. Context: The School Corporation was required to submit two Annual Data Reports to the Indiana Department of Education (IDOE) during the audit period to meet federal reporting requirements for ESSER grant awards. We noted that the ESSER II and ESSER III amounts reported on the Year 3 report ($347,591 and $337,851 respectively) did not agree to the underlying expenditure records ($135,355 and $159,811 respectively). Additionally, we noted that the ESSER II amount reported on the Year 4 report ($233,093) did not agree to the underlying expenditure records ($267,310) of the School Corporation. Identification as a repeat finding: This is a repeat finding from the immediately prior audit. The prior finding number was 2022-003. Recommendation: We recommend someone other than the preparer of the report perform a documented review prior to submission to validate the accuracy and completeness of the data submitted. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
FINDING 2024-003 Information on the federal program: Subject: Education Stabilization Fund (ESSER) – Internal Controls Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D210013, S425U200013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 Financial reporting . . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Reporting compliance requirements. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. FINDING 2024-003 (Continued) Questioned Costs: There were no questioned costs identified. Context: The School Corporation was required to submit two Annual Data Reports to the Indiana Department of Education (IDOE) during the audit period to meet federal reporting requirements for ESSER grant awards. We noted that the ESSER II and ESSER III amounts reported on the Year 3 report ($347,591 and $337,851 respectively) did not agree to the underlying expenditure records ($135,355 and $159,811 respectively). Additionally, we noted that the ESSER II amount reported on the Year 4 report ($233,093) did not agree to the underlying expenditure records ($267,310) of the School Corporation. Identification as a repeat finding: This is a repeat finding from the immediately prior audit. The prior finding number was 2022-003. Recommendation: We recommend someone other than the preparer of the report perform a documented review prior to submission to validate the accuracy and completeness of the data submitted. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
FINDING 2024-002 Information on the federal program: Subject: COVID-19 – Education Stabilization Fund – Reporting Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Finding: Significant Deficiency Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 Financial reporting . . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Reporting compliance requirements. Cause: The School District's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. Internal controls were not adequate to detect and prevent errors in annual data submitted to the Indiana Department of Education. Questioned Costs: There were no questioned costs identified. FINDING 2024-002 (Continued) Context: The School Corporation had not designed nor implemented a system of internal control to ensure that the annual Elementary and Secondary School Emergency Relief (ESSER) annual Data Collection reports (Reports) were complete and accurately submitted. The reports were prepared and submitted in JotForm, the online application used by the Indiana Department of Education to collect information, without an oversight or secondary review process in place to prevent or detect and correct errors. During the testing of the annual data reports, variances were noted in the amounts expended reported on the Year 3 and Year 4 annual data reports for the ESSER II and ESSER III grant awards when compared to underlying disbursement detail for the grant funds. The amounts reported as expended in the Year 3 reports, which covers the period of July 1, 2021 through June 30, 2022, included amounts not expended until the following fiscal year. The amounts reported as expended in the Year 4 report, which covers the period of July 1, 2022 through June 30, 2023, for ESSER III totaled $745,052 compared to underlying disbursement detail of $648,383 for the same period. Identification as a repeat finding, if applicable: No. Recommendation: We recommend someone other than the preparer of the report perform a documented, secondary review of the report information prior to submission to validate the accuracy and completeness of the data submitted. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
FINDING 2024-002 Information on the federal program: Subject: COVID-19 – Education Stabilization Fund – Reporting Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Finding: Significant Deficiency Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 Financial reporting . . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Reporting compliance requirements. Cause: The School District's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. Internal controls were not adequate to detect and prevent errors in annual data submitted to the Indiana Department of Education. Questioned Costs: There were no questioned costs identified. FINDING 2024-002 (Continued) Context: The School Corporation had not designed nor implemented a system of internal control to ensure that the annual Elementary and Secondary School Emergency Relief (ESSER) annual Data Collection reports (Reports) were complete and accurately submitted. The reports were prepared and submitted in JotForm, the online application used by the Indiana Department of Education to collect information, without an oversight or secondary review process in place to prevent or detect and correct errors. During the testing of the annual data reports, variances were noted in the amounts expended reported on the Year 3 and Year 4 annual data reports for the ESSER II and ESSER III grant awards when compared to underlying disbursement detail for the grant funds. The amounts reported as expended in the Year 3 reports, which covers the period of July 1, 2021 through June 30, 2022, included amounts not expended until the following fiscal year. The amounts reported as expended in the Year 4 report, which covers the period of July 1, 2022 through June 30, 2023, for ESSER III totaled $745,052 compared to underlying disbursement detail of $648,383 for the same period. Identification as a repeat finding, if applicable: No. Recommendation: We recommend someone other than the preparer of the report perform a documented, secondary review of the report information prior to submission to validate the accuracy and completeness of the data submitted. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
Information on the federal program: Subject: Education Stabilization Fund (ESSER) – Internal Controls Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D210013, S425U200013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 Financial reporting . . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Reporting compliance requirements. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was required to submit two Annual Data Reports to the Indiana Department of Education (IDOE) during the audit period to meet federal reporting requirements for ESSER grant awards. We noted that the ESSER II and ESSER III amounts reported on the Year 3 report ($397,392 and $294,138, respectively) did not agree to the underlying expenditure records ($498,259 and $1,509,413, respectively, for the period of July 1, 2021 through June 30, 2022). Additionally, we noted that the ESSER II and ESSER III amounts reported on the Year 4 report ($400,501 and $294,129, respectively) did not agree to the underlying expenditure records ($412,324 and $287,065, respectively, for the period of July 1, 2022 through June 30, 2023). We noted that the 602 number of Full-time equivalent (FTE) positions on September 30, 2022 on the first report did not agree to the underlying records supporting number of 1,233 Full-time equivalent (FTE) positions on September 30, 2023. Identification as a repeat finding: No. Recommendation: We recommend someone other than the preparer of the report perform a documented review prior to submission to validate the accuracy and completeness of the data submitted. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
Information on the federal program: Subject: Education Stabilization Fund (ESSER) – Internal Controls Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D210013, S425U200013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 Financial reporting . . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Reporting compliance requirements. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was required to submit two Annual Data Reports to the Indiana Department of Education (IDOE) during the audit period to meet federal reporting requirements for ESSER grant awards. We noted that the ESSER II and ESSER III amounts reported on the Year 3 report ($397,392 and $294,138, respectively) did not agree to the underlying expenditure records ($498,259 and $1,509,413, respectively, for the period of July 1, 2021 through June 30, 2022). Additionally, we noted that the ESSER II and ESSER III amounts reported on the Year 4 report ($400,501 and $294,129, respectively) did not agree to the underlying expenditure records ($412,324 and $287,065, respectively, for the period of July 1, 2022 through June 30, 2023). We noted that the 602 number of Full-time equivalent (FTE) positions on September 30, 2022 on the first report did not agree to the underlying records supporting number of 1,233 Full-time equivalent (FTE) positions on September 30, 2023. Identification as a repeat finding: No. Recommendation: We recommend someone other than the preparer of the report perform a documented review prior to submission to validate the accuracy and completeness of the data submitted. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
Information on the federal program: Subject: Education Stabilization Fund (ESSER) – Internal Controls Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 Financial reporting . . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Reporting compliance requirements. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was required to submit two Annual Data Reports to the Indiana Department of Education (IDOE) during the audit period to meet federal reporting requirements for ESSER grant awards. We noted that the ESSER II amount reported on the Year 3 report ($572,289) did not agree to the underlying expenditure records ($558,956) for the period of July 1, 2021 through June 30, 2022. Additionally, we noted that the ESSER I, ESSER II, and ESSER III amounts reported on the Year 4 report ($105,506, $510,158, and $1,156,254, respectively) did not agree to the underlying expenditure records ($138,662, $316,236, and $1,158,054, respectively) for the period of July 1, 2022 through June 30, 2023. We also noted there was no documented, secondary review of the information in the annual data reports by someone other than the preparer. Identification as a repeat finding: This is a repeat finding from the immediately prior audit. The prior finding number was 2022-008. Recommendation: We recommend someone other than the preparer of the report perform a documented review prior to submission to validate the accuracy and completeness of the data submitted. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
Information on the federal program: Subject: Education Stabilization Fund (ESSER) – Internal Controls Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 Financial reporting . . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Reporting compliance requirements. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was required to submit two Annual Data Reports to the Indiana Department of Education (IDOE) during the audit period to meet federal reporting requirements for ESSER grant awards. We noted that the ESSER II amount reported on the Year 3 report ($572,289) did not agree to the underlying expenditure records ($558,956) for the period of July 1, 2021 through June 30, 2022. Additionally, we noted that the ESSER I, ESSER II, and ESSER III amounts reported on the Year 4 report ($105,506, $510,158, and $1,156,254, respectively) did not agree to the underlying expenditure records ($138,662, $316,236, and $1,158,054, respectively) for the period of July 1, 2022 through June 30, 2023. We also noted there was no documented, secondary review of the information in the annual data reports by someone other than the preparer. Identification as a repeat finding: This is a repeat finding from the immediately prior audit. The prior finding number was 2022-008. Recommendation: We recommend someone other than the preparer of the report perform a documented review prior to submission to validate the accuracy and completeness of the data submitted. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
Condition: During our audit procedures, we noted that the following financial reports were not submitted on time. Criteria: As stated in the award terms 2.CFR 200.328, financial reports are due on a quarterly basis. Cause: The primary cause attributed to the reporting finding regarding late submissions can be identified as a deficiency in personnel resources within FUNDACION DE DESARROLLO COMUNAL DE PUERTO RICO, INC. (FUNDESCO) The Corporation has experienced challenges in adequately staffing its finance and accounting department, thereby impeding its ability to fulfill reporting requirements in a timely and accurate manner. Effect: Late submissions of required financial reports can result in heightened scrutiny from Federal awarding agencies. The Corporation could face delays in receiving future funding until compliance issues are resolved, impacting on its financial stability and mission delivery. Recommendation: FUNDACION DE DESARROLLO COMUNAL DE PUERTO RICO, INC. (FUNDESCO) should establish clear protocols and timelines for the preparation and submission of financial reports to ensure compliance with Federal awarding agency requirements. This includes recruiting more personnel, defining roles and responsibilities within the finance and accounting team and setting deadlines well in advance of the reporting due dates.
FINDING 2024-003 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Number: 84.425U Federal Award Number and Year (or Other Identifying Number): S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Repeat Finding This is a repeat finding from the immediately prior audit report. The prior audit finding number was 2022-002. 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 Reporting compliance requirement. The School Corporation had not designed, nor implemented, a system of internal controls to ensure that the annual Elementary and Secondary School Emergency Relief (ESSER) Data Collection reports (Reports) were complete and accurately submitted. The Reports were prepared by one employee without a documented oversight, review, or approval process in place to prevent, or detect and correct, errors. Due to the lack of effective internal controls, two of the five Reports submitted during the audit period were not supported by the School Corporation's records. The following errors were noted: For the ESSER III, Year 2 report, which covered the period July 1, 2021 to June 30, 2022, total expenses reported were understated by $369,741. For the ESSER III, Year 3 report, which covered the period July 1, 2022 to June 30, 2023, total expenses reported for Property - Mandatory Subgrant Funds - Exclusive of Learning Loss Set-Aside were understated by $519,504. Total expenses reported for Supplies - Mandatory Subgrant Funds - Learning Loss Set-Aside were overstated by $11,260. The lack of internal controls was a systemic issue throughout the audit period. Noncompliance was isolated to the ESSER III, Year 2 and Year 3 reports. INDIANA STATE BOARD OF ACCOUNTS 18 JAC-CEN-DEL COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 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 200.334 states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Cause A proper system of internal controls was not designed by management of the School Corporation. Due to turnover in the position responsible for review, reports were not reviewed to detect errors prior to submission. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, the ESSER III, Year 2 and Year 3 reports were not supported by the School Corporation's records. INDIANA STATE BOARD OF ACCOUNTS 19 JAC-CEN-DEL COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that the management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure that all reports are supported by the School Corporation's records. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-003 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Number: 84.425U Federal Award Number and Year (or Other Identifying Number): S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Repeat Finding This is a repeat finding from the immediately prior audit report. The prior audit finding number was 2022-002. 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 Reporting compliance requirement. The School Corporation had not designed, nor implemented, a system of internal controls to ensure that the annual Elementary and Secondary School Emergency Relief (ESSER) Data Collection reports (Reports) were complete and accurately submitted. The Reports were prepared by one employee without a documented oversight, review, or approval process in place to prevent, or detect and correct, errors. Due to the lack of effective internal controls, two of the five Reports submitted during the audit period were not supported by the School Corporation's records. The following errors were noted: For the ESSER III, Year 2 report, which covered the period July 1, 2021 to June 30, 2022, total expenses reported were understated by $369,741. For the ESSER III, Year 3 report, which covered the period July 1, 2022 to June 30, 2023, total expenses reported for Property - Mandatory Subgrant Funds - Exclusive of Learning Loss Set-Aside were understated by $519,504. Total expenses reported for Supplies - Mandatory Subgrant Funds - Learning Loss Set-Aside were overstated by $11,260. The lack of internal controls was a systemic issue throughout the audit period. Noncompliance was isolated to the ESSER III, Year 2 and Year 3 reports. INDIANA STATE BOARD OF ACCOUNTS 18 JAC-CEN-DEL COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 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 200.334 states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Cause A proper system of internal controls was not designed by management of the School Corporation. Due to turnover in the position responsible for review, reports were not reviewed to detect errors prior to submission. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, the ESSER III, Year 2 and Year 3 reports were not supported by the School Corporation's records. INDIANA STATE BOARD OF ACCOUNTS 19 JAC-CEN-DEL COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that the management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure that all reports are supported by the School Corporation's records. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Condition The required Annual Project and Expenditure (P & E) Report was submitted after its due date. The report was required for the annual peiod ended March 31, 2024, and was due on April 30, 2024. Criteria 2 CFR 200.328 and 31 CFR section 35.4(c) required financial and performance reporting information. The information must be collected with the frequency required by the terms and conditions of the Federal award, but no less frequently than annually nor more frequently than quarterly except in unusual circumstances, for example where more frequent reporting is necessary for the effective monitoring of the Federal award or could significantly affect program outcomes, and preferably in coordination with performance reporting. Context We request the report submitted during the fiscal year to be audited and observed the report was submitted after the due date. Cause The Municipality failed in submission of the required report on time due to lack of knowledge of requisites and instructions about the completion of the report. Effect The Municipality did not comply with compliance requirements of the Program. It could affect the monitories of the Federal Awarding Agency assign the funds and affect the program outcomes. Questioned Costs None. Recommendation The Municipality should maintain the schedule of due dates of required reports of each federal program in order to comply with the required submissions to the federal awarding agencies.