Improve Controls Over Reporting Federal Program Information Federal Agency: U.S. Department of Health and Human Services Cluster/Program: Aging Cluster Award Name: BEAS Nutrition Services AL Number: 93.043, 93.044, 93.053 Award Year: 2023 Compliance Requirement: Reporting Type of Finding Compliance Internal Control over Compliance - Significant Deficiency Criteria or Specific Requirement The requirements that apply to reporting are contained in Financial Reporting, 2 CFR section 200.328, Monitoring and Reporting, 2 CFR section 200.329, program legislation, the Transparency Act, federal awarding agency regulations, and the terms and conditions of the award. Grantees must provide reasonable assurance that required reports for federal awards include all activity of the reporting period, are supported by applicable accounting or performance records, and are fairly presented in accordance with governing requirements. Management of Rockingham Nutrition and Meals on Wheels Program is also responsible for establishing and maintaining effective internal control over compliance with federal requirements that have a direct and material effect on a federal program. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. Condition and Context Three of the total of twelve required quarterly program service reports were selected for review in order to determine if Rockingham Nutrition and Meals on Wheels Program complied with the federal and grant award-specific reporting requirements, and if internal control over compliance was appropriately designed, implemented and effectively operating. As a result of this review, discrepancies were noted between what was reported on the quarterly reports for revenues as compared to the general ledger in the amount of $189,744. Cause Weakness in the design and operation of controls. Effect or Potential Effect Due to the weaknesses in internal controls noted above, Rockingham Nutrition and Meals on Wheels Program did not properly report the required amount of revenues on the quarterly program service reports. Questioned Costs No questioned costs are reported as this requirement relates to revenue reported. Recommendation Rockingham Nutrition and Meals on Wheels Program should address the weakness in internal controls noted above in order to comply with the federal requirements related to reporting. Views of Responsible Official Management agrees with the finding. Planned Corrective Action Management’s corrective action plan is included at the end of this report after the Schedule of Prior Year Findings.
Improve Controls Over Reporting Federal Program Information Federal Agency: U.S. Department of Health and Human Services Cluster/Program: Aging Cluster Award Name: BEAS Nutrition Services AL Number: 93.043, 93.044, 93.053 Award Year: 2023 Compliance Requirement: Reporting Type of Finding Compliance Internal Control over Compliance - Significant Deficiency Criteria or Specific Requirement The requirements that apply to reporting are contained in Financial Reporting, 2 CFR section 200.328, Monitoring and Reporting, 2 CFR section 200.329, program legislation, the Transparency Act, federal awarding agency regulations, and the terms and conditions of the award. Grantees must provide reasonable assurance that required reports for federal awards include all activity of the reporting period, are supported by applicable accounting or performance records, and are fairly presented in accordance with governing requirements. Management of Rockingham Nutrition and Meals on Wheels Program is also responsible for establishing and maintaining effective internal control over compliance with federal requirements that have a direct and material effect on a federal program. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. Condition and Context Three of the total of twelve required quarterly program service reports were selected for review in order to determine if Rockingham Nutrition and Meals on Wheels Program complied with the federal and grant award-specific reporting requirements, and if internal control over compliance was appropriately designed, implemented and effectively operating. As a result of this review, discrepancies were noted between what was reported on the quarterly reports for revenues as compared to the general ledger in the amount of $189,744. Cause Weakness in the design and operation of controls. Effect or Potential Effect Due to the weaknesses in internal controls noted above, Rockingham Nutrition and Meals on Wheels Program did not properly report the required amount of revenues on the quarterly program service reports. Questioned Costs No questioned costs are reported as this requirement relates to revenue reported. Recommendation Rockingham Nutrition and Meals on Wheels Program should address the weakness in internal controls noted above in order to comply with the federal requirements related to reporting. Views of Responsible Official Management agrees with the finding. Planned Corrective Action Management’s corrective action plan is included at the end of this report after the Schedule of Prior Year Findings.
Improve Controls Over Reporting Federal Program Information Federal Agency: U.S. Department of Health and Human Services Cluster/Program: Aging Cluster Award Name: BEAS Nutrition Services AL Number: 93.043, 93.044, 93.053 Award Year: 2023 Compliance Requirement: Reporting Type of Finding Compliance Internal Control over Compliance - Significant Deficiency Criteria or Specific Requirement The requirements that apply to reporting are contained in Financial Reporting, 2 CFR section 200.328, Monitoring and Reporting, 2 CFR section 200.329, program legislation, the Transparency Act, federal awarding agency regulations, and the terms and conditions of the award. Grantees must provide reasonable assurance that required reports for federal awards include all activity of the reporting period, are supported by applicable accounting or performance records, and are fairly presented in accordance with governing requirements. Management of Rockingham Nutrition and Meals on Wheels Program is also responsible for establishing and maintaining effective internal control over compliance with federal requirements that have a direct and material effect on a federal program. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. Condition and Context Three of the total of twelve required quarterly program service reports were selected for review in order to determine if Rockingham Nutrition and Meals on Wheels Program complied with the federal and grant award-specific reporting requirements, and if internal control over compliance was appropriately designed, implemented and effectively operating. As a result of this review, discrepancies were noted between what was reported on the quarterly reports for revenues as compared to the general ledger in the amount of $189,744. Cause Weakness in the design and operation of controls. Effect or Potential Effect Due to the weaknesses in internal controls noted above, Rockingham Nutrition and Meals on Wheels Program did not properly report the required amount of revenues on the quarterly program service reports. Questioned Costs No questioned costs are reported as this requirement relates to revenue reported. Recommendation Rockingham Nutrition and Meals on Wheels Program should address the weakness in internal controls noted above in order to comply with the federal requirements related to reporting. Views of Responsible Official Management agrees with the finding. Planned Corrective Action Management’s corrective action plan is included at the end of this report after the Schedule of Prior Year Findings.
Federal Agency: Department of Education Federal Program Title: Education Stabilization Funds Assistance Listing Number: 84.425 Award Period: July 01, 2022 – June 30, 2023 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: There are three components to reporting for the Higher Education Emergency Relief Funds (HEERF): 1) public reporting on the (a)(1) Student Aid Portion; 2) public reporting on the (a)(1) Institutional Portion (a)(2) and (a)(3) subprograms (Quarterly Reporting Form), as applicable; and 3) the annual report. The CARES Act 18004(e) and the CRRSAA 314(e) requires an institution receiving funds under HEERF I and HEERF II to submit a report to the secretary, at such time in such a manner as the secretary may require. While ARP does not explicitly identify procedures by which institutions must report on their uses of HEERF grant funds, Department of Education (ED) exercises this reporting authority under 2 CFR section 200.328 and 2 CFR section 200.329. Student Aid Portion and Institutional Portion reports are to be posted quarterly and be updated no later than 10 days after the end of each calendar quarter. The annual report for 2022 was due on March 24, 2023. Condition: During our testing of 11 quarterly reports, it was noted that University of Maine at Farmington (UMF) had two reports of two sampled that were not submitted timely. Questioned Costs: None Context: The University did not have a process to track the reporting requirements. Cause: The University did not have someone tracking the requirements to ensure that they posted the reporting timely. Effect: The University did not comply with Department of Education (ED) regulations by reporting information timely. Repeat Finding: Yes; 2022-004 (University of Maine at Farmington, University of Maine at Fort Kent, University of Maine, University of Maine at Presque Isle) Auditors’ Recommendation: We recommend the University review their reporting procedures to ensure reports are being uploaded and submitted timely. Views of Responsible Officials: There is no disagreement with the audit finding.
Federal Agency: Department of Education Federal Program Title: Education Stabilization Funds Assistance Listing Number: 84.425 Award Period: July 01, 2022 – June 30, 2023 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: There are three components to reporting for the Higher Education Emergency Relief Funds (HEERF): 1) public reporting on the (a)(1) Student Aid Portion; 2) public reporting on the (a)(1) Institutional Portion (a)(2) and (a)(3) subprograms (Quarterly Reporting Form), as applicable; and 3) the annual report. The CARES Act 18004(e) and the CRRSAA 314(e) requires an institution receiving funds under HEERF I and HEERF II to submit a report to the secretary, at such time in such a manner as the secretary may require. While ARP does not explicitly identify procedures by which institutions must report on their uses of HEERF grant funds, Department of Education (ED) exercises this reporting authority under 2 CFR section 200.328 and 2 CFR section 200.329. Student Aid Portion and Institutional Portion reports are to be posted quarterly and be updated no later than 10 days after the end of each calendar quarter. The annual report for 2022 was due on March 24, 2023. Condition: During our testing of 11 quarterly reports, it was noted that University of Maine at Farmington (UMF) had two reports of two sampled that were not submitted timely. Questioned Costs: None Context: The University did not have a process to track the reporting requirements. Cause: The University did not have someone tracking the requirements to ensure that they posted the reporting timely. Effect: The University did not comply with Department of Education (ED) regulations by reporting information timely. Repeat Finding: Yes; 2022-004 (University of Maine at Farmington, University of Maine at Fort Kent, University of Maine, University of Maine at Presque Isle) Auditors’ Recommendation: We recommend the University review their reporting procedures to ensure reports are being uploaded and submitted timely. Views of Responsible Officials: There is no disagreement with the audit finding.
Federal Agency: Department of Education Federal Program Title: Education Stabilization Funds Assistance Listing Number: 84.425 Award Period: July 01, 2022 – June 30, 2023 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: There are three components to reporting for the Higher Education Emergency Relief Funds (HEERF): 1) public reporting on the (a)(1) Student Aid Portion; 2) public reporting on the (a)(1) Institutional Portion (a)(2) and (a)(3) subprograms (Quarterly Reporting Form), as applicable; and 3) the annual report. The CARES Act 18004(e) and the CRRSAA 314(e) requires an institution receiving funds under HEERF I and HEERF II to submit a report to the secretary, at such time in such a manner as the secretary may require. While ARP does not explicitly identify procedures by which institutions must report on their uses of HEERF grant funds, Department of Education (ED) exercises this reporting authority under 2 CFR section 200.328 and 2 CFR section 200.329. Student Aid Portion and Institutional Portion reports are to be posted quarterly and be updated no later than 10 days after the end of each calendar quarter. The annual report for 2022 was due on March 24, 2023. Condition: During our testing of 11 quarterly reports, it was noted that University of Maine at Farmington (UMF) had two reports of two sampled that were not submitted timely. Questioned Costs: None Context: The University did not have a process to track the reporting requirements. Cause: The University did not have someone tracking the requirements to ensure that they posted the reporting timely. Effect: The University did not comply with Department of Education (ED) regulations by reporting information timely. Repeat Finding: Yes; 2022-004 (University of Maine at Farmington, University of Maine at Fort Kent, University of Maine, University of Maine at Presque Isle) Auditors’ Recommendation: We recommend the University review their reporting procedures to ensure reports are being uploaded and submitted timely. Views of Responsible Officials: There is no disagreement with the audit finding.
FINDING 2023-010 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Number: 84.425D Federal Award Number and Year (or Other Identifying Number): S425D210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit an annual data report to the Indiana Department of Education (IDOE). Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period, the School Corporation submitted a total of four reports: two ESSER I reports, one ESSER II report, and one ESSER III report. The annual data reports were prepared and submitted to the IDOE by the Chief Financial Officer without an oversight or review process to prevent, or detect and correct, errors. Due to the lack of controls the following errors occurred. The ESSER II, Year 2 report, which covered the period of July 2021 to June 30, 2022, was not supported by the School Corporation's records. $1,555,604 in Expenditures for personnel services - salaries was reported as $1,555,604; however, this amount should have been split between Personnel Services - salaries of $1,062,376, and Personnel Services - Benefits of $493,228 according to the School Corporation's records provided. The lack of internal controls was a systemic issue throughout the audit period and noncompliance was isolated to the ESSER II, Year 2 report. 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 200.302(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. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports were not accurately submitted to the IDOE. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls, including policies and procedures, that would provide segregation of duties to ensure reviews, approvals, and oversight are taking place to ensure reports are submitted accurately. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-010 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Number: 84.425D Federal Award Number and Year (or Other Identifying Number): S425D210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit an annual data report to the Indiana Department of Education (IDOE). Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period, the School Corporation submitted a total of four reports: two ESSER I reports, one ESSER II report, and one ESSER III report. The annual data reports were prepared and submitted to the IDOE by the Chief Financial Officer without an oversight or review process to prevent, or detect and correct, errors. Due to the lack of controls the following errors occurred. The ESSER II, Year 2 report, which covered the period of July 2021 to June 30, 2022, was not supported by the School Corporation's records. $1,555,604 in Expenditures for personnel services - salaries was reported as $1,555,604; however, this amount should have been split between Personnel Services - salaries of $1,062,376, and Personnel Services - Benefits of $493,228 according to the School Corporation's records provided. The lack of internal controls was a systemic issue throughout the audit period and noncompliance was isolated to the ESSER II, Year 2 report. 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 200.302(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. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports were not accurately submitted to the IDOE. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls, including policies and procedures, that would provide segregation of duties to ensure reviews, approvals, and oversight are taking place to ensure reports are submitted accurately. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Finding 2023-001 - Significant Deficiency, Compliance and Control Federal Assistance Listing No. 84.425E U.S. Department Of Education ESF Section 2 - Higher Education (Higher Education Emergency Relief Fund (HEERF)) - Reporting Criteria: 2 CFR section 200.328 and 2 CFR section 200.329 requires grantees to submit quarterly reports for both student and institutional portions along with an annual report to the Department of Education. Condition: In our nonstatistical testing of 2 quarterly reports and 1 annual report, it was noted that for the one student report selected, the appropriate form was not used for reporting the current period activity and the report was not posted timely to the Ottawa University website as required. Cause: Management based the reporting requirement on previous guidance that did not require the use of a specific form to report the required data. Updated guidance required a specific form to use. The University did not use the required form, and the information was uploaded to the Ottawa University website 344 days after the deadline. Effect: Information on student disbursements was not available in the required format or required timeframe. Questioned Costs: Not applicable Context: One student report from our sample was not reported in conformity with the guidance. Identification As A Repeat Finding: Not a repeat finding. Recommendation: We recommend that management develop a system with appropriate controls that allows for implementing the most recent guidance on HEERF reporting.Views Of Responsible Officials: See Corrective Action Plan. Completion Date: March 2024 Contact Person: Donna Ferguson, Controller and Director of Fiscal Operations, and Carrie Stevens, Associate Vice President of Compliance
Identification of Federal Program – 84.425F COVID-19 Higher Education Emergency Relief Funds – Institutional; Department of Education; P425F202028 and 84.425M COVID-19 Higher Education Emergency Relief Funds – Strengthening Institutions Program; Department of Education; P425M200851 Criteria – Quarterly Higher Education Emergency Relief Fund (HEERF) reports are to be publicly posted, accurate, and filed timely. (2 CFR section 200.328 and section 200.329) Condition – During the audit, we reviewed the four quarterly reporting dates for fiscal year 2022-2023 and noted that the fourth quarter report (June 30, 2023) was not filed or publicly posted. Cause – This condition is a result of policies and procedures not being in place to accurately monitor due dates for HEERF reporting. Effect – The fourth quarter report was not available for public review. Context – During our audit procedures, we verified that quarterly reports were publicly published on the College’s website. The fourth quarter (June 30, 2023) report was not listed. Management informed us that the report was not completed for the fourth quarter and was therefore not publicly published. Recommendation – We recommend the College establish policies and procedures to ensure that timely completion, filing, and public publication of the HEERF quarterly reports are performed. Views of Responsible Officials and Planned Corrective Actions – For the first three quarters of the fiscal year, the reports were timely completed and published online, per the grant requirements with a direct link to the documents. The fourth quarter has now been completed and published there, as well. There was a change in the Business Office, where the person responsible for management of this series of awards resigned from the College. We are actively searching to fill the position, Director of Finance, whose responsibilities will include grant management, overall. Though the awards are fully spent and ended at, June 30, 2023, still responsibilities to the grant for record-keeping and final annual reporting, exist. We acknowledge this and have incorporated these items into the calendar of reporting events for these awards.
Identification of Federal Program – 84.425F COVID-19 Higher Education Emergency Relief Funds – Institutional; Department of Education; P425F202028 and 84.425M COVID-19 Higher Education Emergency Relief Funds – Strengthening Institutions Program; Department of Education; P425M200851 Criteria – Quarterly Higher Education Emergency Relief Fund (HEERF) reports are to be publicly posted, accurate, and filed timely. (2 CFR section 200.328 and section 200.329) Condition – During the audit, we reviewed the four quarterly reporting dates for fiscal year 2022-2023 and noted that the fourth quarter report (June 30, 2023) was not filed or publicly posted. Cause – This condition is a result of policies and procedures not being in place to accurately monitor due dates for HEERF reporting. Effect – The fourth quarter report was not available for public review. Context – During our audit procedures, we verified that quarterly reports were publicly published on the College’s website. The fourth quarter (June 30, 2023) report was not listed. Management informed us that the report was not completed for the fourth quarter and was therefore not publicly published. Recommendation – We recommend the College establish policies and procedures to ensure that timely completion, filing, and public publication of the HEERF quarterly reports are performed. Views of Responsible Officials and Planned Corrective Actions – For the first three quarters of the fiscal year, the reports were timely completed and published online, per the grant requirements with a direct link to the documents. The fourth quarter has now been completed and published there, as well. There was a change in the Business Office, where the person responsible for management of this series of awards resigned from the College. We are actively searching to fill the position, Director of Finance, whose responsibilities will include grant management, overall. Though the awards are fully spent and ended at, June 30, 2023, still responsibilities to the grant for record-keeping and final annual reporting, exist. We acknowledge this and have incorporated these items into the calendar of reporting events for these awards.
FINDING 2023-008 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by one employee without an oversight or review process in place to prevent, or detect and correct, errors. In addition, the six reports submitted during the audit period contained errors. The errors were as follows: The ESSER I, Year 2 and ESSER II, Year 1 reports did not contain any expenditures for the reporting period; however, according to the School Corporation's records, there were expenditures of $43,786 for ESSER I and $39,648 for ESSER II during this period. The ESSER I, Year 3; ESSER II, Year 2; ESSER III, Year 1; and ESSER III, Year 2 reports were not supported by the School Corporation's records, were not accurate and complete, and were not mathematically accurate. Reported amounts were greater than the amount shown in the ledger by $35,940, $97,761, and $25,763, respectively. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(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." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, ESSER reports were not supported by the School Corporation's records, were not accurate and complete, and were not mathematically accurate. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure that all reports are submitted accurately. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-008 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by one employee without an oversight or review process in place to prevent, or detect and correct, errors. In addition, the six reports submitted during the audit period contained errors. The errors were as follows: The ESSER I, Year 2 and ESSER II, Year 1 reports did not contain any expenditures for the reporting period; however, according to the School Corporation's records, there were expenditures of $43,786 for ESSER I and $39,648 for ESSER II during this period. The ESSER I, Year 3; ESSER II, Year 2; ESSER III, Year 1; and ESSER III, Year 2 reports were not supported by the School Corporation's records, were not accurate and complete, and were not mathematically accurate. Reported amounts were greater than the amount shown in the ledger by $35,940, $97,761, and $25,763, respectively. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(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." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, ESSER reports were not supported by the School Corporation's records, were not accurate and complete, and were not mathematically accurate. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure that all reports are submitted accurately. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-008 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by one employee without an oversight or review process in place to prevent, or detect and correct, errors. In addition, the six reports submitted during the audit period contained errors. The errors were as follows: The ESSER I, Year 2 and ESSER II, Year 1 reports did not contain any expenditures for the reporting period; however, according to the School Corporation's records, there were expenditures of $43,786 for ESSER I and $39,648 for ESSER II during this period. The ESSER I, Year 3; ESSER II, Year 2; ESSER III, Year 1; and ESSER III, Year 2 reports were not supported by the School Corporation's records, were not accurate and complete, and were not mathematically accurate. Reported amounts were greater than the amount shown in the ledger by $35,940, $97,761, and $25,763, respectively. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(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." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, ESSER reports were not supported by the School Corporation's records, were not accurate and complete, and were not mathematically accurate. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure that all reports are submitted accurately. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-008 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by one employee without an oversight or review process in place to prevent, or detect and correct, errors. In addition, the six reports submitted during the audit period contained errors. The errors were as follows: The ESSER I, Year 2 and ESSER II, Year 1 reports did not contain any expenditures for the reporting period; however, according to the School Corporation's records, there were expenditures of $43,786 for ESSER I and $39,648 for ESSER II during this period. The ESSER I, Year 3; ESSER II, Year 2; ESSER III, Year 1; and ESSER III, Year 2 reports were not supported by the School Corporation's records, were not accurate and complete, and were not mathematically accurate. Reported amounts were greater than the amount shown in the ledger by $35,940, $97,761, and $25,763, respectively. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(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." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, ESSER reports were not supported by the School Corporation's records, were not accurate and complete, and were not mathematically accurate. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure that all reports are submitted accurately. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-008 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by one employee without an oversight or review process in place to prevent, or detect and correct, errors. In addition, the six reports submitted during the audit period contained errors. The errors were as follows: The ESSER I, Year 2 and ESSER II, Year 1 reports did not contain any expenditures for the reporting period; however, according to the School Corporation's records, there were expenditures of $43,786 for ESSER I and $39,648 for ESSER II during this period. The ESSER I, Year 3; ESSER II, Year 2; ESSER III, Year 1; and ESSER III, Year 2 reports were not supported by the School Corporation's records, were not accurate and complete, and were not mathematically accurate. Reported amounts were greater than the amount shown in the ledger by $35,940, $97,761, and $25,763, respectively. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(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." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, ESSER reports were not supported by the School Corporation's records, were not accurate and complete, and were not mathematically accurate. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure that all reports are submitted accurately. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-008 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by one employee without an oversight or review process in place to prevent, or detect and correct, errors. In addition, the six reports submitted during the audit period contained errors. The errors were as follows: The ESSER I, Year 2 and ESSER II, Year 1 reports did not contain any expenditures for the reporting period; however, according to the School Corporation's records, there were expenditures of $43,786 for ESSER I and $39,648 for ESSER II during this period. The ESSER I, Year 3; ESSER II, Year 2; ESSER III, Year 1; and ESSER III, Year 2 reports were not supported by the School Corporation's records, were not accurate and complete, and were not mathematically accurate. Reported amounts were greater than the amount shown in the ledger by $35,940, $97,761, and $25,763, respectively. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(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." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, ESSER reports were not supported by the School Corporation's records, were not accurate and complete, and were not mathematically accurate. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure that all reports are submitted accurately. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-002 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by the Treasurer without an oversight or review process in place to prevent, or detect and correct, errors. Additionally, the ESSER I, Year 2 and ESSER I, Year 3 reports were not supported by the School Corporation's records. Errors noted were as follows: The ESSER I, Year 2 report did not report any expenditures for the reporting period, October 1, 2020 to June 30, 2021; however, the ledger detail had expenditures of $77,594. The key line item "Operational Continuity and other Allowed Uses - Supplies" chosen for review was incorrectly reported. The ESSER I, Year 3 report included Year 1, March 13, 2020 to September 30, 2020, expenditures and Year 3, July 1, 2021 to June 30, 2022, expenditures. The key line item "Meeting Students' Academic, Social, Emotional, and Other Needs (Excluding Mental Health Supports) - Personnel Services - Salaries" chosen for review was incorrectly reported. The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the ESSER I, Year 2 and ESSER I, Year 3 reports. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: INDIANA STATE BOARD OF ACCOUNTS 18 SEYMOUR COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (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. . . . (3) Records that identify adequately the source and application of funds for federally funded activities. These records must contain information pertaining to Federal awards, authorizations, obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. . . ." 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, which would include segregation of key functions. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper design or implementation of the components of a system of internal controls, including policies and procedures that provide segregation of duties and additional oversight as needed, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports submitted to the IDOE were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. INDIANA STATE BOARD OF ACCOUNTS 19 SEYMOUR COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation design and implement a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place prior to filing required reports. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report. INDIANA STATE BOARD OF ACCOUNTS 20
FINDING 2023-002 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by the Treasurer without an oversight or review process in place to prevent, or detect and correct, errors. Additionally, the ESSER I, Year 2 and ESSER I, Year 3 reports were not supported by the School Corporation's records. Errors noted were as follows: The ESSER I, Year 2 report did not report any expenditures for the reporting period, October 1, 2020 to June 30, 2021; however, the ledger detail had expenditures of $77,594. The key line item "Operational Continuity and other Allowed Uses - Supplies" chosen for review was incorrectly reported. The ESSER I, Year 3 report included Year 1, March 13, 2020 to September 30, 2020, expenditures and Year 3, July 1, 2021 to June 30, 2022, expenditures. The key line item "Meeting Students' Academic, Social, Emotional, and Other Needs (Excluding Mental Health Supports) - Personnel Services - Salaries" chosen for review was incorrectly reported. The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the ESSER I, Year 2 and ESSER I, Year 3 reports. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: INDIANA STATE BOARD OF ACCOUNTS 18 SEYMOUR COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (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. . . . (3) Records that identify adequately the source and application of funds for federally funded activities. These records must contain information pertaining to Federal awards, authorizations, obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. . . ." 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, which would include segregation of key functions. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper design or implementation of the components of a system of internal controls, including policies and procedures that provide segregation of duties and additional oversight as needed, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports submitted to the IDOE were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. INDIANA STATE BOARD OF ACCOUNTS 19 SEYMOUR COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation design and implement a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place prior to filing required reports. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report. INDIANA STATE BOARD OF ACCOUNTS 20
FINDING 2023-002 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by the Treasurer without an oversight or review process in place to prevent, or detect and correct, errors. Additionally, the ESSER I, Year 2 and ESSER I, Year 3 reports were not supported by the School Corporation's records. Errors noted were as follows: The ESSER I, Year 2 report did not report any expenditures for the reporting period, October 1, 2020 to June 30, 2021; however, the ledger detail had expenditures of $77,594. The key line item "Operational Continuity and other Allowed Uses - Supplies" chosen for review was incorrectly reported. The ESSER I, Year 3 report included Year 1, March 13, 2020 to September 30, 2020, expenditures and Year 3, July 1, 2021 to June 30, 2022, expenditures. The key line item "Meeting Students' Academic, Social, Emotional, and Other Needs (Excluding Mental Health Supports) - Personnel Services - Salaries" chosen for review was incorrectly reported. The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the ESSER I, Year 2 and ESSER I, Year 3 reports. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: INDIANA STATE BOARD OF ACCOUNTS 18 SEYMOUR COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (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. . . . (3) Records that identify adequately the source and application of funds for federally funded activities. These records must contain information pertaining to Federal awards, authorizations, obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. . . ." 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, which would include segregation of key functions. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper design or implementation of the components of a system of internal controls, including policies and procedures that provide segregation of duties and additional oversight as needed, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports submitted to the IDOE were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. INDIANA STATE BOARD OF ACCOUNTS 19 SEYMOUR COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation design and implement a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place prior to filing required reports. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report. INDIANA STATE BOARD OF ACCOUNTS 20
FINDING 2023-002 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by the Treasurer without an oversight or review process in place to prevent, or detect and correct, errors. Additionally, the ESSER I, Year 2 and ESSER I, Year 3 reports were not supported by the School Corporation's records. Errors noted were as follows: The ESSER I, Year 2 report did not report any expenditures for the reporting period, October 1, 2020 to June 30, 2021; however, the ledger detail had expenditures of $77,594. The key line item "Operational Continuity and other Allowed Uses - Supplies" chosen for review was incorrectly reported. The ESSER I, Year 3 report included Year 1, March 13, 2020 to September 30, 2020, expenditures and Year 3, July 1, 2021 to June 30, 2022, expenditures. The key line item "Meeting Students' Academic, Social, Emotional, and Other Needs (Excluding Mental Health Supports) - Personnel Services - Salaries" chosen for review was incorrectly reported. The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the ESSER I, Year 2 and ESSER I, Year 3 reports. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: INDIANA STATE BOARD OF ACCOUNTS 18 SEYMOUR COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (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. . . . (3) Records that identify adequately the source and application of funds for federally funded activities. These records must contain information pertaining to Federal awards, authorizations, obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. . . ." 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, which would include segregation of key functions. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper design or implementation of the components of a system of internal controls, including policies and procedures that provide segregation of duties and additional oversight as needed, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports submitted to the IDOE were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. INDIANA STATE BOARD OF ACCOUNTS 19 SEYMOUR COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation design and implement a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place prior to filing required reports. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report. INDIANA STATE BOARD OF ACCOUNTS 20
FINDING 2023-002 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by the Treasurer without an oversight or review process in place to prevent, or detect and correct, errors. Additionally, the ESSER I, Year 2 and ESSER I, Year 3 reports were not supported by the School Corporation's records. Errors noted were as follows: The ESSER I, Year 2 report did not report any expenditures for the reporting period, October 1, 2020 to June 30, 2021; however, the ledger detail had expenditures of $77,594. The key line item "Operational Continuity and other Allowed Uses - Supplies" chosen for review was incorrectly reported. The ESSER I, Year 3 report included Year 1, March 13, 2020 to September 30, 2020, expenditures and Year 3, July 1, 2021 to June 30, 2022, expenditures. The key line item "Meeting Students' Academic, Social, Emotional, and Other Needs (Excluding Mental Health Supports) - Personnel Services - Salaries" chosen for review was incorrectly reported. The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the ESSER I, Year 2 and ESSER I, Year 3 reports. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: INDIANA STATE BOARD OF ACCOUNTS 18 SEYMOUR COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (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. . . . (3) Records that identify adequately the source and application of funds for federally funded activities. These records must contain information pertaining to Federal awards, authorizations, obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. . . ." 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, which would include segregation of key functions. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper design or implementation of the components of a system of internal controls, including policies and procedures that provide segregation of duties and additional oversight as needed, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports submitted to the IDOE were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. INDIANA STATE BOARD OF ACCOUNTS 19 SEYMOUR COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation design and implement a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place prior to filing required reports. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report. INDIANA STATE BOARD OF ACCOUNTS 20
FINDING 2023-002 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. The annual data reports were compiled, prepared, and submitted by the Treasurer without an oversight or review process in place to prevent, or detect and correct, errors. Additionally, the ESSER I, Year 2 and ESSER I, Year 3 reports were not supported by the School Corporation's records. Errors noted were as follows: The ESSER I, Year 2 report did not report any expenditures for the reporting period, October 1, 2020 to June 30, 2021; however, the ledger detail had expenditures of $77,594. The key line item "Operational Continuity and other Allowed Uses - Supplies" chosen for review was incorrectly reported. The ESSER I, Year 3 report included Year 1, March 13, 2020 to September 30, 2020, expenditures and Year 3, July 1, 2021 to June 30, 2022, expenditures. The key line item "Meeting Students' Academic, Social, Emotional, and Other Needs (Excluding Mental Health Supports) - Personnel Services - Salaries" chosen for review was incorrectly reported. The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the ESSER I, Year 2 and ESSER I, Year 3 reports. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: INDIANA STATE BOARD OF ACCOUNTS 18 SEYMOUR COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (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. . . . (3) Records that identify adequately the source and application of funds for federally funded activities. These records must contain information pertaining to Federal awards, authorizations, obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. . . ." 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, which would include segregation of key functions. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper design or implementation of the components of a system of internal controls, including policies and procedures that provide segregation of duties and additional oversight as needed, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports submitted to the IDOE were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. INDIANA STATE BOARD OF ACCOUNTS 19 SEYMOUR COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation design and implement a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place prior to filing required reports. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report. INDIANA STATE BOARD OF ACCOUNTS 20
(2023-073) Title: Internal control over ELC program reporting needs improvement Prior Year Findings: See schedule of Findings and Questioned Costs for chart/table State Department: Health and Human Services State Bureau: Maine Center for Disease Control & Prevention Federal Agency: U.S. Department of Health and Human Services Assistance Listing Title: Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (COVID-19) Assistance Listing Number: 93.323 Federal Award Identification Number: See E-93 to E-94 Compliance Area: Reporting Type of Finding: Significant deficiency Questioned Costs: None Criteria: 2 CFR 200.303; 2 CFR 200.302; 2 CFR 200.329 The Department must establish and maintain effective internal control over Federal awards that provides reasonable assurance that the Department is managing awards in compliance with Federal statutes, regulations, and the terms and conditions of awards. The Department must maintain accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with reporting requirements. The Department must submit performance reports at the interval required by the Federal awarding agency or pass-through entity to best inform improvements in program outcomes and productivity. Condition: The purpose of the Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) program is to protect public health and safety by enhancing the capacity of public health agencies to effectively detect, respond to, prevent, and control known and emerging infectious diseases. The Maine Center for Disease Control & Prevention (MeCDC) administers the ELC program and is responsible for the preparation, accuracy, and submission of financial and performance reports to the Federal awarding agency. Financial Reports The Office of the State Auditor (OSA) reviewed seven of the 33 financial reports due in fiscal year 2023 and found that adequate documentation to support that four of the reports had been reviewed prior to submission could not be provided. OSA selected a non-statistical random sample. Performance Reports The Department was required to submit performance reports for three grants during fiscal year 2023. MeCDC provided the submitted reports; however, adequate supporting documentation could not be provided. Context: During fiscal year 2023, 33 financial reports and performance reports for three grants were required to be filed for the ELC program. Cause: • Lack of adequate policies and procedures • Lack of supervisory oversight Effect: Without documentation in support of ELC program reporting requirements, the timeliness and veracity of procedures to ensure compliance cannot be verified; therefore, incorrect or incomplete data may be reported to the Federal government Recommendation: We recommend that MeCDC enhance policies and procedures to ensure that documentation to support the accuracy and completeness of performance and financial reports is retained to demonstrate compliance with Federal reporting requirements. Corrective Action Plan: See F-31 Management’s Response: The Department agrees with this finding. With each quarterly financial reporting due on the 20th of each subsequent month (November, February, May, and August), the Maine CDC will submit quarterly financial reports for internal review by the 10th of the pertinent month. The internal reviewer will have until the 18th to review and submit corrections, for reporting to be inputted into CAMP. A confirmatory email for the process will be issued to record the examination of financial reporting. For performance reporting, quantitative data is pulled for each report, however data cleaning of the quantitative data is ongoing and a requirement from the Federal CDC. Data pulled for each report will only be accurate at the point in time when the data is pulled. Each year's data is not finalized until six plus months after the year ends. The Federal CDC does not require past reports to be reposted and updated as data cleaning occurs after the initial report is filed. For performance reporting of qualitative data, each team holds a quarterly meeting to review the milestones and provide updates. These meetings will now be recorded and will be available to audit upon request. For any qualitative milestone where progress is made on any given period, the Maine CDC will ensure there is a documented note associated with the percentage completeness selected to further document the recorded value. Contact: Sara Robinson, Infectious Disease Program Manager, DHHS, 207-287-4610 (State Number: 23-1156-02)
(2023-073) Title: Internal control over ELC program reporting needs improvement Prior Year Findings: See schedule of Findings and Questioned Costs for chart/table State Department: Health and Human Services State Bureau: Maine Center for Disease Control & Prevention Federal Agency: U.S. Department of Health and Human Services Assistance Listing Title: Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (COVID-19) Assistance Listing Number: 93.323 Federal Award Identification Number: See E-93 to E-94 Compliance Area: Reporting Type of Finding: Significant deficiency Questioned Costs: None Criteria: 2 CFR 200.303; 2 CFR 200.302; 2 CFR 200.329 The Department must establish and maintain effective internal control over Federal awards that provides reasonable assurance that the Department is managing awards in compliance with Federal statutes, regulations, and the terms and conditions of awards. The Department must maintain accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with reporting requirements. The Department must submit performance reports at the interval required by the Federal awarding agency or pass-through entity to best inform improvements in program outcomes and productivity. Condition: The purpose of the Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) program is to protect public health and safety by enhancing the capacity of public health agencies to effectively detect, respond to, prevent, and control known and emerging infectious diseases. The Maine Center for Disease Control & Prevention (MeCDC) administers the ELC program and is responsible for the preparation, accuracy, and submission of financial and performance reports to the Federal awarding agency. Financial Reports The Office of the State Auditor (OSA) reviewed seven of the 33 financial reports due in fiscal year 2023 and found that adequate documentation to support that four of the reports had been reviewed prior to submission could not be provided. OSA selected a non-statistical random sample. Performance Reports The Department was required to submit performance reports for three grants during fiscal year 2023. MeCDC provided the submitted reports; however, adequate supporting documentation could not be provided. Context: During fiscal year 2023, 33 financial reports and performance reports for three grants were required to be filed for the ELC program. Cause: • Lack of adequate policies and procedures • Lack of supervisory oversight Effect: Without documentation in support of ELC program reporting requirements, the timeliness and veracity of procedures to ensure compliance cannot be verified; therefore, incorrect or incomplete data may be reported to the Federal government Recommendation: We recommend that MeCDC enhance policies and procedures to ensure that documentation to support the accuracy and completeness of performance and financial reports is retained to demonstrate compliance with Federal reporting requirements. Corrective Action Plan: See F-31 Management’s Response: The Department agrees with this finding. With each quarterly financial reporting due on the 20th of each subsequent month (November, February, May, and August), the Maine CDC will submit quarterly financial reports for internal review by the 10th of the pertinent month. The internal reviewer will have until the 18th to review and submit corrections, for reporting to be inputted into CAMP. A confirmatory email for the process will be issued to record the examination of financial reporting. For performance reporting, quantitative data is pulled for each report, however data cleaning of the quantitative data is ongoing and a requirement from the Federal CDC. Data pulled for each report will only be accurate at the point in time when the data is pulled. Each year's data is not finalized until six plus months after the year ends. The Federal CDC does not require past reports to be reposted and updated as data cleaning occurs after the initial report is filed. For performance reporting of qualitative data, each team holds a quarterly meeting to review the milestones and provide updates. These meetings will now be recorded and will be available to audit upon request. For any qualitative milestone where progress is made on any given period, the Maine CDC will ensure there is a documented note associated with the percentage completeness selected to further document the recorded value. Contact: Sara Robinson, Infectious Disease Program Manager, DHHS, 207-287-4610 (State Number: 23-1156-02)
Criteria There are three components to reporting for HEERF: 1) public reporting on the (a)(1) Student Aid Portion; 2) public reporting on the (a)(1) Institutional Portion (a)(2) and (a)(3) subprograms (Quarterly Reporting Form), as applicable; and 3) the annual report. The CARES Act 18004(e) and the CRRSAA 314(e) require an institution receiving funds under HEERF I and HEERF II to submit a report to the secretary, at such time in such a manner as the secretary may require. While ARP does not explicitly identify procedures by which institutions must report on their uses of HEERF grant funds, ED exercises this reporting authority under 2 CFR section 200.328 and 2 CFR section 200.329. ED required an annual report from HEERF grantees to be filed in March 2023 that included reporting uses of HEERF I CARES Act funds, HEERF II CRRSAA funds, and HEERF III ARP funds for the 2022 calendar year. Additionally, beginning with the second quarter of 2022 quarterly report, institutions were required to complete and post on their websites a combined institutional and student reporting form. This form was required to be conspicuously posted on the institutions’ website no later than 10 days after the calendar quarter (January 10, April 10, July 10, October 10) as long as the institution’s HEERF grant was active. Further, in accordance with 2 CFR 200.303(a), non-federal entities must 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 During the year ended June 30, 2023, the College did not publish its quarterly reporting on the College's website within the 10-day compliance requirement for the quarters ending, March 31, 2023 and June 30, 2023. Cause The College’s HEERF reporting process did not include a control designed to monitor the timeliness and accuracy of the required reporting in either of the two prior years (2021 and 2022). This was noted as a finding in both 2022 (2022-002) and 2021 (2021-001). Although the College drafted a corrective action plan in March 2023 that included implementation of a control designed to monitor the timeliness and accuracy of the required reporting, due to employee turnover, the control was not implemented prior to June 30, 2023. Effect If appropriate controls are not designed and operating effectively over the HEERF reporting process, HEERF expenditures reported on the College’s website may be incomplete, inaccurate, or not posted within the timeframe required. Questioned Costs None noted. Statistical Sampling The sample was not intended to be and was not a statistically valid sample. Prior Year Finding Yes – 2022-002 Recommendation We recommend that the College implement a more thorough and detailed process and related internal controls to ensure timely and accurate reporting required under its Federal programs. Management’s Views Subsequent to June 30, 2023, management has reviewed its reporting requirements under its Federal programs and implemented controls to ensure accuracy and timeliness of required reporting. In prior years, there has been high employee turnover in the business office, now that staffing has stabilized, the College has implemented new general controls over all federal funding received. For future funds, the Senior Accountant will be responsible for the receipt and disbursement of federal funds, and for monitoring reporting requirements. Additionally, the Associate Vice President for Finance and Controller will oversee the process and ensure that spending guidelines are followed and that all deadlines for reporting are met. Anticipated Completion Date Completed – December 15, 2023 Responsible Person Heather Martinez, Associate Vice President for Finance and Controller
FINDING 2023-006 Subject: Title I Grants to Local Educational Agencies - Reporting Federal Agency: Department of Education Federal Program: Title I Grants to Local Educational Agencies Assistance Listings Number: 84.010 Federal Award Numbers and Years (or Other Identifying Numbers): S010A190014, S010A200014, S010A210014, S010A220014 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit final expenditure reports to the Indiana Department of Education (IDOE) on or before December 31, after the September 30 deadline, for encumbering prior school year funds. INDIANA STATE BOARD OF ACCOUNTS 23 CROTHERSVILLE COMMUNITY SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) During the audit period, the School Corporation submitted three final expenditure reports. The final expenditure reports were completed and submitted by the Treasurer without an oversight or review process in place to prevent, or detect and correct, errors. In addition, the final expenditure report for the Title I School Improvement for program year 2021, due December 30, 2021, was submitted March 7, 2024. The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the final expenditure report for the Title I School Improvement grant. 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 200.302(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." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation, which would include segregation of key functions. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. INDIANA STATE BOARD OF ACCOUNTS 24 CROTHERSVILLE COMMUNITY SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Effect Without the proper design or implementation of the components of a system of internal controls, including policies and procedures that provide segregation of duties and additional oversight as needed, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, Title I reports submitted to the IDOE were not submitted in a timely manner. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation design and implement a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place prior to filing required reports. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-006 Subject: Title I Grants to Local Educational Agencies - Reporting Federal Agency: Department of Education Federal Program: Title I Grants to Local Educational Agencies Assistance Listings Number: 84.010 Federal Award Numbers and Years (or Other Identifying Numbers): S010A190014, S010A200014, S010A210014, S010A220014 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit final expenditure reports to the Indiana Department of Education (IDOE) on or before December 31, after the September 30 deadline, for encumbering prior school year funds. INDIANA STATE BOARD OF ACCOUNTS 23 CROTHERSVILLE COMMUNITY SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) During the audit period, the School Corporation submitted three final expenditure reports. The final expenditure reports were completed and submitted by the Treasurer without an oversight or review process in place to prevent, or detect and correct, errors. In addition, the final expenditure report for the Title I School Improvement for program year 2021, due December 30, 2021, was submitted March 7, 2024. The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the final expenditure report for the Title I School Improvement grant. 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 200.302(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." 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation, which would include segregation of key functions. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. INDIANA STATE BOARD OF ACCOUNTS 24 CROTHERSVILLE COMMUNITY SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Effect Without the proper design or implementation of the components of a system of internal controls, including policies and procedures that provide segregation of duties and additional oversight as needed, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, Title I reports submitted to the IDOE were not submitted in a timely manner. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation design and implement a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place prior to filing required reports. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-010 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance with the Reporting compliance requirement. The School Corporation was required to submit annual data reports to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period, the School Corporation submitted two ESSER I reports, two ESSER II reports, and one ESSER III report, for a total of five reports. A single employee prepared and submitted each annual data report without a review or oversight process in place to prevent, or detect and correct, errors. All five reports were selected for testing, two of which were not supported by the School Corporation's records. The errors identified were as follows: 1. The ESSER I, Year 2 report, which covered the period of October 1, 2020 to June 30, 2021, reported total expenses of $24,256; however, the School Corporation's ledger for the same period had total expenses of $35,344. INDIANA STATE BOARD OF ACCOUNTS 32 CROTHERSVILLE COMMUNITY SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2. The ESSER II, Year 1 report, which covered the period of July 1, 2020 to June 30, 2021, reported total expenditures of $25,264; however, the School Corporation's ledger for the same period had total expenses of $244,923. In addition, the key line items "Meeting Students' Academic, Social, Emotional, and Other Needs (Excluding Mental Health Supports) - Personnel Services - Salaries" and "Meeting Students' Academic, Social, Emotional, and Other Needs (Excluding Mental Health Supports) - Purchased Property Services" were reported incorrectly. The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the ESSER I, Year 2 and ESSER II, Year 1 reports. 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 200.302(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. . . ." Cause A proper system of internal controls was not designed and implemented by management of the School Corporation, which would include segregation of key functions. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper design or implementation of the components of a system of internal controls, including policies and procedures that provide segregation of duties and additional oversight, as needed, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports submitted to the IDOE were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. INDIANA STATE BOARD OF ACCOUNTS 33 CROTHERSVILLE COMMUNITY SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure all reports submitted on behalf of the COVID-19 - Education Stabilization Fund program funds are supported by the School Corporation's underlying accounting records. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-010 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance with the Reporting compliance requirement. The School Corporation was required to submit annual data reports to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period, the School Corporation submitted two ESSER I reports, two ESSER II reports, and one ESSER III report, for a total of five reports. A single employee prepared and submitted each annual data report without a review or oversight process in place to prevent, or detect and correct, errors. All five reports were selected for testing, two of which were not supported by the School Corporation's records. The errors identified were as follows: 1. The ESSER I, Year 2 report, which covered the period of October 1, 2020 to June 30, 2021, reported total expenses of $24,256; however, the School Corporation's ledger for the same period had total expenses of $35,344. INDIANA STATE BOARD OF ACCOUNTS 32 CROTHERSVILLE COMMUNITY SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2. The ESSER II, Year 1 report, which covered the period of July 1, 2020 to June 30, 2021, reported total expenditures of $25,264; however, the School Corporation's ledger for the same period had total expenses of $244,923. In addition, the key line items "Meeting Students' Academic, Social, Emotional, and Other Needs (Excluding Mental Health Supports) - Personnel Services - Salaries" and "Meeting Students' Academic, Social, Emotional, and Other Needs (Excluding Mental Health Supports) - Purchased Property Services" were reported incorrectly. The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the ESSER I, Year 2 and ESSER II, Year 1 reports. 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 200.302(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. . . ." Cause A proper system of internal controls was not designed and implemented by management of the School Corporation, which would include segregation of key functions. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper design or implementation of the components of a system of internal controls, including policies and procedures that provide segregation of duties and additional oversight, as needed, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports submitted to the IDOE were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. INDIANA STATE BOARD OF ACCOUNTS 33 CROTHERSVILLE COMMUNITY SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure all reports submitted on behalf of the COVID-19 - Education Stabilization Fund program funds are supported by the School Corporation's underlying accounting records. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-010 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance with the Reporting compliance requirement. The School Corporation was required to submit annual data reports to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period, the School Corporation submitted two ESSER I reports, two ESSER II reports, and one ESSER III report, for a total of five reports. A single employee prepared and submitted each annual data report without a review or oversight process in place to prevent, or detect and correct, errors. All five reports were selected for testing, two of which were not supported by the School Corporation's records. The errors identified were as follows: 1. The ESSER I, Year 2 report, which covered the period of October 1, 2020 to June 30, 2021, reported total expenses of $24,256; however, the School Corporation's ledger for the same period had total expenses of $35,344. INDIANA STATE BOARD OF ACCOUNTS 32 CROTHERSVILLE COMMUNITY SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2. The ESSER II, Year 1 report, which covered the period of July 1, 2020 to June 30, 2021, reported total expenditures of $25,264; however, the School Corporation's ledger for the same period had total expenses of $244,923. In addition, the key line items "Meeting Students' Academic, Social, Emotional, and Other Needs (Excluding Mental Health Supports) - Personnel Services - Salaries" and "Meeting Students' Academic, Social, Emotional, and Other Needs (Excluding Mental Health Supports) - Purchased Property Services" were reported incorrectly. The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the ESSER I, Year 2 and ESSER II, Year 1 reports. 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 200.302(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. . . ." Cause A proper system of internal controls was not designed and implemented by management of the School Corporation, which would include segregation of key functions. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper design or implementation of the components of a system of internal controls, including policies and procedures that provide segregation of duties and additional oversight, as needed, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports submitted to the IDOE were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. INDIANA STATE BOARD OF ACCOUNTS 33 CROTHERSVILLE COMMUNITY SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure all reports submitted on behalf of the COVID-19 - Education Stabilization Fund program funds are supported by the School Corporation's underlying accounting records. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-010 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance with the Reporting compliance requirement. The School Corporation was required to submit annual data reports to the Indiana Department of Education (IDOE) via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and expenditures per activity. During the audit period, the School Corporation submitted two ESSER I reports, two ESSER II reports, and one ESSER III report, for a total of five reports. A single employee prepared and submitted each annual data report without a review or oversight process in place to prevent, or detect and correct, errors. All five reports were selected for testing, two of which were not supported by the School Corporation's records. The errors identified were as follows: 1. The ESSER I, Year 2 report, which covered the period of October 1, 2020 to June 30, 2021, reported total expenses of $24,256; however, the School Corporation's ledger for the same period had total expenses of $35,344. INDIANA STATE BOARD OF ACCOUNTS 32 CROTHERSVILLE COMMUNITY SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2. The ESSER II, Year 1 report, which covered the period of July 1, 2020 to June 30, 2021, reported total expenditures of $25,264; however, the School Corporation's ledger for the same period had total expenses of $244,923. In addition, the key line items "Meeting Students' Academic, Social, Emotional, and Other Needs (Excluding Mental Health Supports) - Personnel Services - Salaries" and "Meeting Students' Academic, Social, Emotional, and Other Needs (Excluding Mental Health Supports) - Purchased Property Services" were reported incorrectly. The lack of internal controls was a systemic issue throughout the audit period. The noncompliance was isolated to the ESSER I, Year 2 and ESSER II, Year 1 reports. 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 200.302(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. . . ." Cause A proper system of internal controls was not designed and implemented by management of the School Corporation, which would include segregation of key functions. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper design or implementation of the components of a system of internal controls, including policies and procedures that provide segregation of duties and additional oversight, as needed, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports submitted to the IDOE were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. INDIANA STATE BOARD OF ACCOUNTS 33 CROTHERSVILLE COMMUNITY SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure all reports submitted on behalf of the COVID-19 - Education Stabilization Fund program funds are supported by the School Corporation's underlying accounting records. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Criteria: There are three components to reporting for HEERF: 1) public reporting on the (a)(1) Student Aid; 2) public reporting on the (a)(1) Institutional Portion (a)(2) and (a)(3) subprograms (Quarterly Reporting Form), as applicable; and 3) the annual report (Annual Report). The Coronavirus Aid, Relief, and Economic Security (CARES) Act 18004(e) and the Coronavirus Response and Relief Supplemental Appropriations Act (CRRSAA) 314(e) requires an institution receiving funds under HEERF I and HEERF II to submit a report to the secretary, at such time in such a manner as the secretary may require. While American Rescue Plan (ARP) does not explicitly identify procedures by which institutions must report on their uses of HEERF grant funds, ED exercises this reporting authority under 2 CFR section 200.328 and 2 CFR section 200.329. Condition: For one quarterly report, the supporting documentation maintained did not agree to the information included in the report. Additionally, the Annual Report for 2022 was not prepared. Context: For quarterly reporting, we selected a non-statistical sample of two Quarterly Reporting Forms for testing, noting that for one report, discrepancies between the supporting documentation and the information in the report existed in 3 out of 6 lines of data. For annual reporting, management indicated that they did not believe they were required to prepare the Annual Report for 2022 as all program funds were expended prior to December 31, 2022. Cause: Management indicated that due to the urgency in ensuring funds were distributed as quickly as possible, it was necessary to gather information from various sources within the University. However, the turnover of staff resulted in a lack of retention of this information in a manner conducive to easy retrieval, compilation and reconciliation with reported amounts. Effect: The Quarterly Reporting Forms that were completed may contain inaccurate or incomplete data. In addition, the University was not compliant with the requirement to submit the Annual Report for 2022. Questioned Costs: None Identification of a repeat finding: This is a repeat finding of 2022-002. Recommendations: As the HEERF Program has ended for the University, we recommend that if similar programs become available in the future, management should develop well-documented policies and procedures. These should be detailed enough to ensure that essential knowledge and information for report preparation, including information sources, can withstand significant staff turnover. Views of responsible officials: The HPU Office of Sponsored Projects (OSP) and the Office of Financial Aid endeavor to follow all applicable reporting regulations and guidance mandated for federally funded grant and contract programs. The HEERF awards were fully expended as of June 30, 2022 for the Student Portion and as of September 30, 2022 for the Institutional Portion. Should similar programs become available in the future, management will develop, in advance of expending funds, documented policies and procedures to administer the program and will maintain documentation demonstrating compliance with program requirements and related institutional policy and procedure.
Criteria: There are three components to reporting for HEERF: 1) public reporting on the (a)(1) Student Aid; 2) public reporting on the (a)(1) Institutional Portion (a)(2) and (a)(3) subprograms (Quarterly Reporting Form), as applicable; and 3) the annual report (Annual Report). The Coronavirus Aid, Relief, and Economic Security (CARES) Act 18004(e) and the Coronavirus Response and Relief Supplemental Appropriations Act (CRRSAA) 314(e) requires an institution receiving funds under HEERF I and HEERF II to submit a report to the secretary, at such time in such a manner as the secretary may require. While American Rescue Plan (ARP) does not explicitly identify procedures by which institutions must report on their uses of HEERF grant funds, ED exercises this reporting authority under 2 CFR section 200.328 and 2 CFR section 200.329. Condition: For one quarterly report, the supporting documentation maintained did not agree to the information included in the report. Additionally, the Annual Report for 2022 was not prepared. Context: For quarterly reporting, we selected a non-statistical sample of two Quarterly Reporting Forms for testing, noting that for one report, discrepancies between the supporting documentation and the information in the report existed in 3 out of 6 lines of data. For annual reporting, management indicated that they did not believe they were required to prepare the Annual Report for 2022 as all program funds were expended prior to December 31, 2022. Cause: Management indicated that due to the urgency in ensuring funds were distributed as quickly as possible, it was necessary to gather information from various sources within the University. However, the turnover of staff resulted in a lack of retention of this information in a manner conducive to easy retrieval, compilation and reconciliation with reported amounts. Effect: The Quarterly Reporting Forms that were completed may contain inaccurate or incomplete data. In addition, the University was not compliant with the requirement to submit the Annual Report for 2022. Questioned Costs: None Identification of a repeat finding: This is a repeat finding of 2022-002. Recommendations: As the HEERF Program has ended for the University, we recommend that if similar programs become available in the future, management should develop well-documented policies and procedures. These should be detailed enough to ensure that essential knowledge and information for report preparation, including information sources, can withstand significant staff turnover. Views of responsible officials: The HPU Office of Sponsored Projects (OSP) and the Office of Financial Aid endeavor to follow all applicable reporting regulations and guidance mandated for federally funded grant and contract programs. The HEERF awards were fully expended as of June 30, 2022 for the Student Portion and as of September 30, 2022 for the Institutional Portion. Should similar programs become available in the future, management will develop, in advance of expending funds, documented policies and procedures to administer the program and will maintain documentation demonstrating compliance with program requirements and related institutional policy and procedure.
2 CFR section 200.329 states that non-federal entities may be required to submit performance reports at least annually but not more frequently than quarterly, except in unusual circumstances, using a form or format authorized by OMB. They also may be required to submit special reports as required by the terms and conditions of the federal award. Quarterly Budget and Expenditure Reporting for all HEERF I, II, and III grant funds reporting requirements involve publicly posting completed forms conspicuously on the institution’s website both timely and accurately. During testing it was noted that the required reports for the fiscal year being audited were not posted to the Center’s website. The Center should implement procedures to ensure that the required quarterly reports are timely and accurately posted to the Center’s website.
2 CFR section 200.329 states that non-federal entities may be required to submit performance reports at least annually but not more frequently than quarterly, except in unusual circumstances, using a form or format authorized by OMB. They also may be required to submit special reports as required by the terms and conditions of the federal award. Quarterly Budget and Expenditure Reporting for all HEERF I, II, and III grant funds reporting requirements involve publicly posting completed forms conspicuously on the institution’s website both timely and accurately. During testing it was noted that the required reports for the fiscal year being audited were not posted to the Center’s website. The Center should implement procedures to ensure that the required quarterly reports are timely and accurately posted to the Center’s website.
FINDING 2023-005 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and key line items such as "Number of Specific Positions Supported with Esser Funds," "Allocation of ESSER funds," "Expenditures per Activity," and "Full-Time Equivalency Positions." During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. There was no evidence of an oversight or review process in place to prevent, or detect and correct, errors. All six reports were selected for testing. For four of the six annual data reports the report could not be traced to the records, nor could the accuracy and completeness of the reports be verified. The errors identified were as follows: The ESSER I, Year 2 report, which covered the period of October 1, 2020 to June 30, 2021, reported total expenses of $260,064. However, the School Corporation's ledger for the same period had total expenses of $264,832. Of the reported expenditures, $219,703 could not be determined to be properly categorized. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. INDIANA STATE BOARD OF ACCOUNTS 26 WASHINGTON COMMUNITY SCHOOLS, INC. SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The ESSER I, Year 3 report, which covered the period of July 1, 2021 to June 30, 2022, reported total expenses of $86,521. However, the School Corporation's ledger for the same period had total expenses of $78,230. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The ESSER II, Year 1 and Year 2 reports, which covered the periods of July 1, 2020 to June 30, 2021, and July 1, 2021 to June 30, 2022, respectively, Key Line Items were not able to be traced to supporting documentation. The Expenditures by Subgrant Fund, expenditure category, and object code were supported by the School Corporation's records; however, the School Corporation did not provide supporting documentation for the nonfinancial data required to be submitted with the reports. The ESSER III, Year 1 report, which covered the period of July 1, 2020 to June 30, 2021, reported total expenses of $41,340. However, the School Corporation's ledger for the same period had total expenses of $20,670. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The ESSER III, Year 2 report, which covered the period of July 1, 2021 to June 30, 2022, reported total expenses of $1,407,299, which agreed to the School Corporation's ledger. However, $644,730 of the reported expenditures could not be determined to be properly categorized. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(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." INDIANA STATE BOARD OF ACCOUNTS 27 WASHINGTON COMMUNITY SCHOOLS, INC. SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, the reports were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure all reports submitted on behalf of the COVID-19 - Education Stabilization Fund program funds are supported by the School Corporation's underlying accounting records. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-005 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and key line items such as "Number of Specific Positions Supported with Esser Funds," "Allocation of ESSER funds," "Expenditures per Activity," and "Full-Time Equivalency Positions." During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. There was no evidence of an oversight or review process in place to prevent, or detect and correct, errors. All six reports were selected for testing. For four of the six annual data reports the report could not be traced to the records, nor could the accuracy and completeness of the reports be verified. The errors identified were as follows: The ESSER I, Year 2 report, which covered the period of October 1, 2020 to June 30, 2021, reported total expenses of $260,064. However, the School Corporation's ledger for the same period had total expenses of $264,832. Of the reported expenditures, $219,703 could not be determined to be properly categorized. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. INDIANA STATE BOARD OF ACCOUNTS 26 WASHINGTON COMMUNITY SCHOOLS, INC. SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The ESSER I, Year 3 report, which covered the period of July 1, 2021 to June 30, 2022, reported total expenses of $86,521. However, the School Corporation's ledger for the same period had total expenses of $78,230. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The ESSER II, Year 1 and Year 2 reports, which covered the periods of July 1, 2020 to June 30, 2021, and July 1, 2021 to June 30, 2022, respectively, Key Line Items were not able to be traced to supporting documentation. The Expenditures by Subgrant Fund, expenditure category, and object code were supported by the School Corporation's records; however, the School Corporation did not provide supporting documentation for the nonfinancial data required to be submitted with the reports. The ESSER III, Year 1 report, which covered the period of July 1, 2020 to June 30, 2021, reported total expenses of $41,340. However, the School Corporation's ledger for the same period had total expenses of $20,670. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The ESSER III, Year 2 report, which covered the period of July 1, 2021 to June 30, 2022, reported total expenses of $1,407,299, which agreed to the School Corporation's ledger. However, $644,730 of the reported expenditures could not be determined to be properly categorized. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(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." INDIANA STATE BOARD OF ACCOUNTS 27 WASHINGTON COMMUNITY SCHOOLS, INC. SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, the reports were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure all reports submitted on behalf of the COVID-19 - Education Stabilization Fund program funds are supported by the School Corporation's underlying accounting records. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-005 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and key line items such as "Number of Specific Positions Supported with Esser Funds," "Allocation of ESSER funds," "Expenditures per Activity," and "Full-Time Equivalency Positions." During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. There was no evidence of an oversight or review process in place to prevent, or detect and correct, errors. All six reports were selected for testing. For four of the six annual data reports the report could not be traced to the records, nor could the accuracy and completeness of the reports be verified. The errors identified were as follows: The ESSER I, Year 2 report, which covered the period of October 1, 2020 to June 30, 2021, reported total expenses of $260,064. However, the School Corporation's ledger for the same period had total expenses of $264,832. Of the reported expenditures, $219,703 could not be determined to be properly categorized. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. INDIANA STATE BOARD OF ACCOUNTS 26 WASHINGTON COMMUNITY SCHOOLS, INC. SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The ESSER I, Year 3 report, which covered the period of July 1, 2021 to June 30, 2022, reported total expenses of $86,521. However, the School Corporation's ledger for the same period had total expenses of $78,230. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The ESSER II, Year 1 and Year 2 reports, which covered the periods of July 1, 2020 to June 30, 2021, and July 1, 2021 to June 30, 2022, respectively, Key Line Items were not able to be traced to supporting documentation. The Expenditures by Subgrant Fund, expenditure category, and object code were supported by the School Corporation's records; however, the School Corporation did not provide supporting documentation for the nonfinancial data required to be submitted with the reports. The ESSER III, Year 1 report, which covered the period of July 1, 2020 to June 30, 2021, reported total expenses of $41,340. However, the School Corporation's ledger for the same period had total expenses of $20,670. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The ESSER III, Year 2 report, which covered the period of July 1, 2021 to June 30, 2022, reported total expenses of $1,407,299, which agreed to the School Corporation's ledger. However, $644,730 of the reported expenditures could not be determined to be properly categorized. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(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." INDIANA STATE BOARD OF ACCOUNTS 27 WASHINGTON COMMUNITY SCHOOLS, INC. SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, the reports were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure all reports submitted on behalf of the COVID-19 - Education Stabilization Fund program funds are supported by the School Corporation's underlying accounting records. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-005 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and key line items such as "Number of Specific Positions Supported with Esser Funds," "Allocation of ESSER funds," "Expenditures per Activity," and "Full-Time Equivalency Positions." During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. There was no evidence of an oversight or review process in place to prevent, or detect and correct, errors. All six reports were selected for testing. For four of the six annual data reports the report could not be traced to the records, nor could the accuracy and completeness of the reports be verified. The errors identified were as follows: The ESSER I, Year 2 report, which covered the period of October 1, 2020 to June 30, 2021, reported total expenses of $260,064. However, the School Corporation's ledger for the same period had total expenses of $264,832. Of the reported expenditures, $219,703 could not be determined to be properly categorized. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. INDIANA STATE BOARD OF ACCOUNTS 26 WASHINGTON COMMUNITY SCHOOLS, INC. SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The ESSER I, Year 3 report, which covered the period of July 1, 2021 to June 30, 2022, reported total expenses of $86,521. However, the School Corporation's ledger for the same period had total expenses of $78,230. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The ESSER II, Year 1 and Year 2 reports, which covered the periods of July 1, 2020 to June 30, 2021, and July 1, 2021 to June 30, 2022, respectively, Key Line Items were not able to be traced to supporting documentation. The Expenditures by Subgrant Fund, expenditure category, and object code were supported by the School Corporation's records; however, the School Corporation did not provide supporting documentation for the nonfinancial data required to be submitted with the reports. The ESSER III, Year 1 report, which covered the period of July 1, 2020 to June 30, 2021, reported total expenses of $41,340. However, the School Corporation's ledger for the same period had total expenses of $20,670. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The ESSER III, Year 2 report, which covered the period of July 1, 2021 to June 30, 2022, reported total expenses of $1,407,299, which agreed to the School Corporation's ledger. However, $644,730 of the reported expenditures could not be determined to be properly categorized. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(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." INDIANA STATE BOARD OF ACCOUNTS 27 WASHINGTON COMMUNITY SCHOOLS, INC. SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, the reports were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure all reports submitted on behalf of the COVID-19 - Education Stabilization Fund program funds are supported by the School Corporation's underlying accounting records. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-005 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and key line items such as "Number of Specific Positions Supported with Esser Funds," "Allocation of ESSER funds," "Expenditures per Activity," and "Full-Time Equivalency Positions." During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. There was no evidence of an oversight or review process in place to prevent, or detect and correct, errors. All six reports were selected for testing. For four of the six annual data reports the report could not be traced to the records, nor could the accuracy and completeness of the reports be verified. The errors identified were as follows: The ESSER I, Year 2 report, which covered the period of October 1, 2020 to June 30, 2021, reported total expenses of $260,064. However, the School Corporation's ledger for the same period had total expenses of $264,832. Of the reported expenditures, $219,703 could not be determined to be properly categorized. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. INDIANA STATE BOARD OF ACCOUNTS 26 WASHINGTON COMMUNITY SCHOOLS, INC. SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The ESSER I, Year 3 report, which covered the period of July 1, 2021 to June 30, 2022, reported total expenses of $86,521. However, the School Corporation's ledger for the same period had total expenses of $78,230. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The ESSER II, Year 1 and Year 2 reports, which covered the periods of July 1, 2020 to June 30, 2021, and July 1, 2021 to June 30, 2022, respectively, Key Line Items were not able to be traced to supporting documentation. The Expenditures by Subgrant Fund, expenditure category, and object code were supported by the School Corporation's records; however, the School Corporation did not provide supporting documentation for the nonfinancial data required to be submitted with the reports. The ESSER III, Year 1 report, which covered the period of July 1, 2020 to June 30, 2021, reported total expenses of $41,340. However, the School Corporation's ledger for the same period had total expenses of $20,670. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The ESSER III, Year 2 report, which covered the period of July 1, 2021 to June 30, 2022, reported total expenses of $1,407,299, which agreed to the School Corporation's ledger. However, $644,730 of the reported expenditures could not be determined to be properly categorized. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(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." INDIANA STATE BOARD OF ACCOUNTS 27 WASHINGTON COMMUNITY SCHOOLS, INC. SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, the reports were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure all reports submitted on behalf of the COVID-19 - Education Stabilization Fund program funds are supported by the School Corporation's underlying accounting records. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2023-005 Subject: COVID-19 - Education Stabilization Fund - Reporting Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The School Corporation was required to submit annual data reports to the Indiana Department of Education via JotForm, a form/report builder. Data to be submitted included, but was not limited to, current period expenditures, prior period expenditures, and key line items such as "Number of Specific Positions Supported with Esser Funds," "Allocation of ESSER funds," "Expenditures per Activity," and "Full-Time Equivalency Positions." During the audit period the School Corporation submitted two ESSER I reports, two ESSER II reports, and two ESSER III reports, for a total of six reports. There was no evidence of an oversight or review process in place to prevent, or detect and correct, errors. All six reports were selected for testing. For four of the six annual data reports the report could not be traced to the records, nor could the accuracy and completeness of the reports be verified. The errors identified were as follows: The ESSER I, Year 2 report, which covered the period of October 1, 2020 to June 30, 2021, reported total expenses of $260,064. However, the School Corporation's ledger for the same period had total expenses of $264,832. Of the reported expenditures, $219,703 could not be determined to be properly categorized. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. INDIANA STATE BOARD OF ACCOUNTS 26 WASHINGTON COMMUNITY SCHOOLS, INC. SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The ESSER I, Year 3 report, which covered the period of July 1, 2021 to June 30, 2022, reported total expenses of $86,521. However, the School Corporation's ledger for the same period had total expenses of $78,230. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The ESSER II, Year 1 and Year 2 reports, which covered the periods of July 1, 2020 to June 30, 2021, and July 1, 2021 to June 30, 2022, respectively, Key Line Items were not able to be traced to supporting documentation. The Expenditures by Subgrant Fund, expenditure category, and object code were supported by the School Corporation's records; however, the School Corporation did not provide supporting documentation for the nonfinancial data required to be submitted with the reports. The ESSER III, Year 1 report, which covered the period of July 1, 2020 to June 30, 2021, reported total expenses of $41,340. However, the School Corporation's ledger for the same period had total expenses of $20,670. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The ESSER III, Year 2 report, which covered the period of July 1, 2021 to June 30, 2022, reported total expenses of $1,407,299, which agreed to the School Corporation's ledger. However, $644,730 of the reported expenditures could not be determined to be properly categorized. In addition, the School Corporation was unable to provide supporting documentation for the identified Key Line Items. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(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." INDIANA STATE BOARD OF ACCOUNTS 27 WASHINGTON COMMUNITY SCHOOLS, INC. SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 34 CFR 76.731 states: "A State and a subgrantee shall keep records to show its compliance with program requirements." Cause A proper system of internal controls was not designed by management of the School Corporation. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, the reports were not supported by the School Corporation's underlying accounting records. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure all reports submitted on behalf of the COVID-19 - Education Stabilization Fund program funds are supported by the School Corporation's underlying accounting records. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
2023-022 - Inadequate Controls over Reporting and Other Federal Compliance Requirements for the Medicaid and Children’s Health Insurance Programs Award Years: 2022, 2023 Award Numbers: 2205LA5021, 2205LA5MAP, 2305LA5021, 2305LA5MAP Compliance Requirements: Matching, Earmarking, Period of Performance, Reporting Repeat Finding: No See Schedule of Findings and Questioned Costs for chart/table Condition: LDH erroneously double-reported expenditures for the Medicaid program, resulting in questioned costs, and did not complete certain quarterly checklist reviews intended to ensure compliance with the reporting and matching federal compliance requirements for the Medicaid program and the reporting, period of performance, matching, and earmarking federal compliance requirements for the CHIP program. LDH improperly included the same $16.6 million Medicaid expenditure on both the September 30, 2022, and March 31, 2023, quarterly federal expenditure reports. In addition, LDH did not complete two of the four (50%) quarterly checklist reviews for fiscal year 2023. Criteria: According to 2 CFR 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 2 CFR 200.328 and 200.329 is required. The Medicaid and CHIP programs require quarterly reporting to Centers for Medicare and Medicaid Services (CMS) detailing expenditures by category of service for which states are entitled to federal reimbursement. The federal expenditures reported in the quarterly reports are used to reconcile the draws of federal funds. In addition, good internal controls require that policies and procedures are established and followed to ensure compliance with federal requirements. Cause: LDH did not ensure their controls over federal requirements were completed for every quarter during fiscal year 2023. In addition, LDH did not accurately complete the quarterly reconciliation, which is intended to ensure all items are accurately reported on the quarterly federal expenditure report. Effect: Double-reporting expenditures resulted in $14.9 million in federal questioned costs for the year ending June 30, 2023. As a result of not completing quarterly checklist reviews, LDH failed to detect the misreporting of a $1.7 million recoupment of Disproportionate Share Hospital payments on the wrong federal year schedule for the June 30, 2023, quarterly federal expenditure report. Recommendation: LDH management should strengthen controls over preparation and review of the quarterly federal expenditure reports to ensure federal expenditures are accurately reported and should ensure all quarterly checklist reviews are completed. Management’s Response and Corrective Action Plan: Management partially concurred with the finding and provided a corrective action plan (B-23). Auditor’s Additional Comments: Management's response stated, "LDH disagrees that the quarterly checklist is intended to demonstrate compliance with the federal reporting requirements." LDH management previously represented that the quarterly checklist was part of LDH's internal control process to document the preparation and review of the quarterly federal expenditure reports. As stated in the finding, the noncompliance associated with federal reporting requirements occurred because LDH did not ensure their internal controls over federal requirements were completed for every quarter during fiscal year 2023.
2023-022 - Inadequate Controls over Reporting and Other Federal Compliance Requirements for the Medicaid and Children’s Health Insurance Programs Award Years: 2022, 2023 Award Numbers: 2205LA5021, 2205LA5MAP, 2305LA5021, 2305LA5MAP Compliance Requirements: Matching, Earmarking, Period of Performance, Reporting Repeat Finding: No See Schedule of Findings and Questioned Costs for chart/table Condition: LDH erroneously double-reported expenditures for the Medicaid program, resulting in questioned costs, and did not complete certain quarterly checklist reviews intended to ensure compliance with the reporting and matching federal compliance requirements for the Medicaid program and the reporting, period of performance, matching, and earmarking federal compliance requirements for the CHIP program. LDH improperly included the same $16.6 million Medicaid expenditure on both the September 30, 2022, and March 31, 2023, quarterly federal expenditure reports. In addition, LDH did not complete two of the four (50%) quarterly checklist reviews for fiscal year 2023. Criteria: According to 2 CFR 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 2 CFR 200.328 and 200.329 is required. The Medicaid and CHIP programs require quarterly reporting to Centers for Medicare and Medicaid Services (CMS) detailing expenditures by category of service for which states are entitled to federal reimbursement. The federal expenditures reported in the quarterly reports are used to reconcile the draws of federal funds. In addition, good internal controls require that policies and procedures are established and followed to ensure compliance with federal requirements. Cause: LDH did not ensure their controls over federal requirements were completed for every quarter during fiscal year 2023. In addition, LDH did not accurately complete the quarterly reconciliation, which is intended to ensure all items are accurately reported on the quarterly federal expenditure report. Effect: Double-reporting expenditures resulted in $14.9 million in federal questioned costs for the year ending June 30, 2023. As a result of not completing quarterly checklist reviews, LDH failed to detect the misreporting of a $1.7 million recoupment of Disproportionate Share Hospital payments on the wrong federal year schedule for the June 30, 2023, quarterly federal expenditure report. Recommendation: LDH management should strengthen controls over preparation and review of the quarterly federal expenditure reports to ensure federal expenditures are accurately reported and should ensure all quarterly checklist reviews are completed. Management’s Response and Corrective Action Plan: Management partially concurred with the finding and provided a corrective action plan (B-23). Auditor’s Additional Comments: Management's response stated, "LDH disagrees that the quarterly checklist is intended to demonstrate compliance with the federal reporting requirements." LDH management previously represented that the quarterly checklist was part of LDH's internal control process to document the preparation and review of the quarterly federal expenditure reports. As stated in the finding, the noncompliance associated with federal reporting requirements occurred because LDH did not ensure their internal controls over federal requirements were completed for every quarter during fiscal year 2023.
2023-022 - Inadequate Controls over Reporting and Other Federal Compliance Requirements for the Medicaid and Children’s Health Insurance Programs Award Years: 2022, 2023 Award Numbers: 2205LA5021, 2205LA5MAP, 2305LA5021, 2305LA5MAP Compliance Requirements: Matching, Earmarking, Period of Performance, Reporting Repeat Finding: No See Schedule of Findings and Questioned Costs for chart/table Condition: LDH erroneously double-reported expenditures for the Medicaid program, resulting in questioned costs, and did not complete certain quarterly checklist reviews intended to ensure compliance with the reporting and matching federal compliance requirements for the Medicaid program and the reporting, period of performance, matching, and earmarking federal compliance requirements for the CHIP program. LDH improperly included the same $16.6 million Medicaid expenditure on both the September 30, 2022, and March 31, 2023, quarterly federal expenditure reports. In addition, LDH did not complete two of the four (50%) quarterly checklist reviews for fiscal year 2023. Criteria: According to 2 CFR 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 2 CFR 200.328 and 200.329 is required. The Medicaid and CHIP programs require quarterly reporting to Centers for Medicare and Medicaid Services (CMS) detailing expenditures by category of service for which states are entitled to federal reimbursement. The federal expenditures reported in the quarterly reports are used to reconcile the draws of federal funds. In addition, good internal controls require that policies and procedures are established and followed to ensure compliance with federal requirements. Cause: LDH did not ensure their controls over federal requirements were completed for every quarter during fiscal year 2023. In addition, LDH did not accurately complete the quarterly reconciliation, which is intended to ensure all items are accurately reported on the quarterly federal expenditure report. Effect: Double-reporting expenditures resulted in $14.9 million in federal questioned costs for the year ending June 30, 2023. As a result of not completing quarterly checklist reviews, LDH failed to detect the misreporting of a $1.7 million recoupment of Disproportionate Share Hospital payments on the wrong federal year schedule for the June 30, 2023, quarterly federal expenditure report. Recommendation: LDH management should strengthen controls over preparation and review of the quarterly federal expenditure reports to ensure federal expenditures are accurately reported and should ensure all quarterly checklist reviews are completed. Management’s Response and Corrective Action Plan: Management partially concurred with the finding and provided a corrective action plan (B-23). Auditor’s Additional Comments: Management's response stated, "LDH disagrees that the quarterly checklist is intended to demonstrate compliance with the federal reporting requirements." LDH management previously represented that the quarterly checklist was part of LDH's internal control process to document the preparation and review of the quarterly federal expenditure reports. As stated in the finding, the noncompliance associated with federal reporting requirements occurred because LDH did not ensure their internal controls over federal requirements were completed for every quarter during fiscal year 2023.
Condition During our audit, we examined a non statistical sample of four ERA quarterly compliance reports. We identified inaccurate information submitted for one of the reports examined. Also, for two reports examined, we were unable to complete our testing due to incomplete reports being provided. Criteria 2 CFR Sections 200.328 and 200.329 provide certain requirements for accurate financial and performance reporting. Effect Inaccurate reporting affects the accuracy and transparency of the program funds used and reported to the Department of Treasury. Cause Although the City has policies and procedures in place to ensure proper reporting, City personnel were not diligent in following procedures to ensure accurate reporting. Also due to system limitations at the Department of Treasury and a lack of retention policies, the City was unable to provide completed quarterly reports. Recommendation We recommend the City be more diligent in following its policies and procedures for submitting quarterly information to the Department of Treasury. We also recommend the City implement retention procedures to track the reports and supporting information submitted to the Department of Treasury.
Finding 2023-001: Accuracy of expenditures on the Schedule of Expenditures of Federal Awards and submission of special reports for the Head Start Program Cluster Name: Head Start Federal Awarding Agency: Department of Health and Human Services Award Name: Head Start and Early Head Start, COVID (P.L. 116-260) Award Number: 09CH010228-05-05, 09CH011831-02-03, 09HE000328-01-00 Award Years: 2019-2021, 2021-2022, 2021-2023 Assistance Listing Title: Head Start Assistance Listing Number: 93.600 Pass-through entities: Not applicable Criteria 2 CFR 200.510 Financial statements requires auditees to prepare a schedule of expenditures of Federal awards (SEFA) for the period covered by the auditee’s financial statements which must include the total Federal awards expended as determined in accordance with 2 CFR 200.502. The information presented should be consistent with the accounting records and other federal guidance. 2 CFR Part 200 Appendix XI Part 3-L-1 Performance and Special Reporting notes that non-federal entities may be required to submit performance reports at least annually but not more frequently than quarterly, except in unusual circumstances, using a form or format authorized by OMB (2 CFR section 200.329). They also may be required to submit special reports as required by the terms and conditions of the federal award. Condition The following errors were identified related to funding that was improperly included in the fiscal year 2023 SEFA and have subsequently been corrected in the fiscal year 2023 SEFA by the University, as a result of our audit procedures: • In fiscal year 2023, $283 thousand in budgeted capital expenditures were charged to and drawn down on Head Start awards before actual expenditures were incurred by the University. Management identified the error in the subsequent year and credited the fiscal year 2024 SEFA for this amount. Additionally, management refunded the federal agency $159 thousand of the amount in November 2023 and is in the process of refunding the remaining balance plus imputed interest. • In fiscal year 2023, $67 thousand in actual expenditures were charged to a Head Start award after liquidation extensions associated with the award had expired. Management identified the error in the subsequent year but had not yet credited the amount in the SEFA. None of the funds were drawn down from the federal agency, and thus, a refund to the federal agency was not required. Of the three required federal reports selected for testing, two were not submitted until selected for testing and one has not yet been submitted. Cause The University has limited federal awards that are utilized to fund capital expenditures. As a result, management was not aware that budgeted capital expenditures were being charged to the Head Start program in advance of being incurred by the University’s Facilities Management Services Department. Additionally, while the University’s IT system prevents the draw down of funding from federal agencies for awards that have expired, it does not prevent expenditures from being charged to expired awards. Management’s manual expenditure reconciliation process for the Head Start program failed to identify that expenditures were charged to the award after the expiration date in a timely manner. Management lacks a formalized process for identifying and tracking submission of required reports under the Head Start program. Effect A SEFA that is not accurate could impact the scoping of an entity’s major programs and result in inaccurate information being provided to the federal government. Not submitting required federal reports results in the federal government not having the information it needs to inform improvements in program outcomes and productivity. Questioned Costs None noted. Recommendation We recommend that management reinforce its existing policies regarding the charging of expenditures to the Head Start program with all departments involved in administering federal awards. Additionally, we recommend that management more timely reconcile expenditures charged to the Head Start program so that any necessary adjustments are reflected in the appropriate fiscal year. We recommend management implement a formal process to identify and track submission of required reports under the Head Start program. Management’s Corrective Action Plan Management’s response is reported on “Management’s Views and Corrective Action Plan” at the end of this report.
2023-002 Program: Community Development Block Grants / Entitlement Grants Federal Financial Assistance Listing Number: 14.218 Grant Identification Number: B-22-MC-06-0004 and related program income Federal Grantor: U.S. Department of Housing and Urban Development Passthrough Entity: State Department of Housing and Community Development Compliance Requirements: Reporting Type of Finding: Material Weakness in the Internal Control over Compliance and Material Noncompliance Repeat finding: Yes Criteria: 2 CFR 200.329(b) requires that reports submitted to the federal awarding agency include all activity of the reporting period, are supported by applicable accounting or performance records, and are fairly presented in accordance with program requirements. The City must submit Quarterly Reports that contains the cash available on hand that is supported by actual amounts reported in the financial statements. Condition: Cash on hand information was reported inaccurately. Cause: The City’s control did not ensure the Cash on Hand Report was prepared in accordance with federal requirements and the review process at the City did not capture the information needed to ensure that the reports were accurate. Effect: Inaccurate information was reported to the federal awarding agency. Questioned Costs: None. Context/Sampling: All four quarters of the program did not report the correct cash amount on hand. Repeat Findings from Prior Years: No. Recommendation: We recommend that the City follows its comprehensive policies and procedures ensuring that the quarterly reports are reviewed timely before they are submitted to the federal agencies. Views of Responsible Officials: See separately issued Corrective Action Plan.
2023-002 Program: Community Development Block Grants / Entitlement Grants Federal Financial Assistance Listing Number: 14.218 Grant Identification Number: B-22-MC-06-0004 and related program income Federal Grantor: U.S. Department of Housing and Urban Development Passthrough Entity: State Department of Housing and Community Development Compliance Requirements: Reporting Type of Finding: Material Weakness in the Internal Control over Compliance and Material Noncompliance Repeat finding: Yes Criteria: 2 CFR 200.329(b) requires that reports submitted to the federal awarding agency include all activity of the reporting period, are supported by applicable accounting or performance records, and are fairly presented in accordance with program requirements. The City must submit Quarterly Reports that contains the cash available on hand that is supported by actual amounts reported in the financial statements. Condition: Cash on hand information was reported inaccurately. Cause: The City’s control did not ensure the Cash on Hand Report was prepared in accordance with federal requirements and the review process at the City did not capture the information needed to ensure that the reports were accurate. Effect: Inaccurate information was reported to the federal awarding agency. Questioned Costs: None. Context/Sampling: All four quarters of the program did not report the correct cash amount on hand. Repeat Findings from Prior Years: No. Recommendation: We recommend that the City follows its comprehensive policies and procedures ensuring that the quarterly reports are reviewed timely before they are submitted to the federal agencies. Views of Responsible Officials: See separately issued Corrective Action Plan.
Federal Program Information: COVID 19 HEERF Institutional Portion ALN 84.425F COVID 19 HEERF-Strengthening Institutions Program ALN 84.425M Criteria: 2 CFR 200.329 and the terms and conditions of the federal award requires the entity to submit reports quarterly. Condition: The total expenditures on the September 2022 and March 2023 quarterly report was not correct. Questioned Costs: None Context: The testing of the September 2022 and March 2023 quarterly reports showed that incorrect amounts were reported for expenditures. Cause/Effect: The College made errors when completing certain quarterly reports. Repeat Finding from Prior Audit?: Yes. Recommendation: We recommend review of current practices and implement policies establishing monitoring procedures related to quarterly reports. Management Response: The College agrees with the finding and is implementing appropriate procedures.