Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: Department of Agriculture Federal Program Title: Research and Development Cluster Assistance Listing Number: 10.205, 10.512, 10.443, 10.215 Federal Award Identification Number: NI211445XXXXG001, NI221445XXXXG019, NI191444XXXXG019, NI201444XXXXG009, A0192501X443G023, SUB00002488 PASS THRU 2019- 38640-29878 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance; Compliance, Other Matters Condition: The University does not have adequate procedures in place to ensure that USDA federal funds were not spent on disallowed costs. Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. As required by 2 CFR 200.403 expenditures of federal awards should be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Context: During testing, we were made aware of thirteen individuals whose salaries were improperly coded to a teaching code in USDA federal and state match funds. A total of $256,940 in federal funds and $160,791 in state match funds were coded to a teaching account salary code. Additionally, during our testing of 40 payroll we identified 1 transaction that was improperly coded to the incorrect account code. Questioned costs: $256,940 Cause: The University does not have an effective control in place to ensure payroll transactions are properly coded between federal and nonfederal funds. Effect: Failure to properly record federal and nonfederal funds may result in inaccurate reporting of disallowed costs on the Schedule of Expenditures of Federal Awards. Repeat finding: No Recommendation: We recommend the University review its current procedures to ensure non-federal costs are not being allocated to federal fund codes. Also, the University should process retro-active cost transfers or payroll adjustments to ensure that no teaching salaries are coded to USDA grant funds. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Finding - District controls did not always ensure compliance with Federal regulations by properly expending Federal Hurricane Education Recovery Program funds, resulting in questioned costs totaling $325,202. Criteria - Title 2, Section 200.403(a), CFR, requires that allowable costs under Federal awards must be necessary and reasonable for the performance of the Federal award. In addition, Public Law 109-148 established the Hurricane Education Recovery Program and specifies in Section 102(e)(3)(A) that funding may not be used for construction or major renovations of school buildings. Condition - During the 2022-23 fiscal year, District Hurricane Education Recovery Program expenditures totaled $1,230,221, and included four payments totaling $325,202 for construction or major renovation of school facilities. Specifically, a payment for $199,500 was made for the roof replacement of a District building, and three additional payments, totaling $125,702, were made for architectural and engineering services related to the construction of the new Gadsden County K-8 School. Additionally, the approved grant application only included temporary repairs to the roof, including tarping and cleanup of water damage and did not include any architectural or engineering services. Cause - Due to staff turnover and the subsequent reassignment of duties, the District grant director lacked Hurricane Education Recovery Program experience. In response to our inquiry, District staff indicated that the Program expenditures were allowable for District site and facilities that were not damaged before the hurricane. Notwithstanding, District staff did not provide documentation from the grantor supporting allowability and the expenditures are explicitly unallowed by the Public Law. Effect - Absent effective procedures to ensure that grant funds are expended only for allowable uses, there is an increased risk that funds will be misused. Since District records did not support the allowability of these costs, the District incurred questioned costs totaling $325,202. Recommendation - The District should help ensure that Hurricane Education Recovery Program expenditures are only for allowable purposes by providing appropriate training for the Program grant director. In addition, the District should document to the FDOE the allowability of the questioned costs or contact the FDOE regarding necessary corrective action. District Response - The District confirms the audit finding and will implement policies and procedures, as well as staff training, to ensure compliance with the Federal Hurricane Education Recovery Program.
2023-001 U.S. Department of Education Passed-through the Commonwealth of Massachusetts Department of Elementary and Secondary Education Special Education Cluster (IDEA) – ALN 84.027 & 84.173 Special Education Cluster (IDEA) – ALN 84.027X & 84.173X Compliance Finding and Material Weakness in Internal Controls Over Compliance Criteria: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). Condition: Tuition invoices and payroll costs were charged to a 2023 grant that were for services rendered prior to the grant start date. Cause: The School did not review manual journal entries for period of performance compliance when reclassifying grant expenditures from other accounts. Effect: The School was not compliant with period of performance requirements of the grant. Questioned Costs: $225,827.29 Repeat Finding from Prior Year: No. Recommendation: The School should implement procedures to review all manual journal entries for period of performance compliance before posting to the general ledger. Views of Responsible Official: Management agrees with the finding.
2023-001 U.S. Department of Education Passed-through the Commonwealth of Massachusetts Department of Elementary and Secondary Education Special Education Cluster (IDEA) – ALN 84.027 & 84.173 Special Education Cluster (IDEA) – ALN 84.027X & 84.173X Compliance Finding and Material Weakness in Internal Controls Over Compliance Criteria: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). Condition: Tuition invoices and payroll costs were charged to a 2023 grant that were for services rendered prior to the grant start date. Cause: The School did not review manual journal entries for period of performance compliance when reclassifying grant expenditures from other accounts. Effect: The School was not compliant with period of performance requirements of the grant. Questioned Costs: $225,827.29 Repeat Finding from Prior Year: No. Recommendation: The School should implement procedures to review all manual journal entries for period of performance compliance before posting to the general ledger. Views of Responsible Official: Management agrees with the finding.
2023-001 U.S. Department of Education Passed-through the Commonwealth of Massachusetts Department of Elementary and Secondary Education Special Education Cluster (IDEA) – ALN 84.027 & 84.173 Special Education Cluster (IDEA) – ALN 84.027X & 84.173X Compliance Finding and Material Weakness in Internal Controls Over Compliance Criteria: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). Condition: Tuition invoices and payroll costs were charged to a 2023 grant that were for services rendered prior to the grant start date. Cause: The School did not review manual journal entries for period of performance compliance when reclassifying grant expenditures from other accounts. Effect: The School was not compliant with period of performance requirements of the grant. Questioned Costs: $225,827.29 Repeat Finding from Prior Year: No. Recommendation: The School should implement procedures to review all manual journal entries for period of performance compliance before posting to the general ledger. Views of Responsible Official: Management agrees with the finding.
2023-001 U.S. Department of Education Passed-through the Commonwealth of Massachusetts Department of Elementary and Secondary Education Special Education Cluster (IDEA) – ALN 84.027 & 84.173 Special Education Cluster (IDEA) – ALN 84.027X & 84.173X Compliance Finding and Material Weakness in Internal Controls Over Compliance Criteria: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). Condition: Tuition invoices and payroll costs were charged to a 2023 grant that were for services rendered prior to the grant start date. Cause: The School did not review manual journal entries for period of performance compliance when reclassifying grant expenditures from other accounts. Effect: The School was not compliant with period of performance requirements of the grant. Questioned Costs: $225,827.29 Repeat Finding from Prior Year: No. Recommendation: The School should implement procedures to review all manual journal entries for period of performance compliance before posting to the general ledger. Views of Responsible Official: Management agrees with the finding.
2023-001 U.S. Department of Education Passed-through the Commonwealth of Massachusetts Department of Elementary and Secondary Education Special Education Cluster (IDEA) – ALN 84.027 & 84.173 Special Education Cluster (IDEA) – ALN 84.027X & 84.173X Compliance Finding and Material Weakness in Internal Controls Over Compliance Criteria: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). Condition: Tuition invoices and payroll costs were charged to a 2023 grant that were for services rendered prior to the grant start date. Cause: The School did not review manual journal entries for period of performance compliance when reclassifying grant expenditures from other accounts. Effect: The School was not compliant with period of performance requirements of the grant. Questioned Costs: $225,827.29 Repeat Finding from Prior Year: No. Recommendation: The School should implement procedures to review all manual journal entries for period of performance compliance before posting to the general ledger. Views of Responsible Official: Management agrees with the finding.
2023-001 U.S. Department of Education Passed-through the Commonwealth of Massachusetts Department of Elementary and Secondary Education Special Education Cluster (IDEA) – ALN 84.027 & 84.173 Special Education Cluster (IDEA) – ALN 84.027X & 84.173X Compliance Finding and Material Weakness in Internal Controls Over Compliance Criteria: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). Condition: Tuition invoices and payroll costs were charged to a 2023 grant that were for services rendered prior to the grant start date. Cause: The School did not review manual journal entries for period of performance compliance when reclassifying grant expenditures from other accounts. Effect: The School was not compliant with period of performance requirements of the grant. Questioned Costs: $225,827.29 Repeat Finding from Prior Year: No. Recommendation: The School should implement procedures to review all manual journal entries for period of performance compliance before posting to the general ledger. Views of Responsible Official: Management agrees with the finding.
2023-001 U.S. Department of Education Passed-through the Commonwealth of Massachusetts Department of Elementary and Secondary Education Special Education Cluster (IDEA) – ALN 84.027 & 84.173 Special Education Cluster (IDEA) – ALN 84.027X & 84.173X Compliance Finding and Material Weakness in Internal Controls Over Compliance Criteria: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). Condition: Tuition invoices and payroll costs were charged to a 2023 grant that were for services rendered prior to the grant start date. Cause: The School did not review manual journal entries for period of performance compliance when reclassifying grant expenditures from other accounts. Effect: The School was not compliant with period of performance requirements of the grant. Questioned Costs: $225,827.29 Repeat Finding from Prior Year: No. Recommendation: The School should implement procedures to review all manual journal entries for period of performance compliance before posting to the general ledger. Views of Responsible Official: Management agrees with the finding.
Finding Number 2023-002: Timesheet vs. Time Study Hours (Significant Deficiency over Internal Control and Instance of Noncompliance – Allowable Costs/Cost Principles) FALN Number 93.778 Alameda Health Care Services Agency - Medical Assistance Program (Medi-Cal Administrative Activities), Award Number MAA MOU 2022-2023, Award Year 2022-2023 Criteria: 2023 Compliance Supplement and 2 CFR 200.403(h) stated that a non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance. Condition/Context: As a result of our audit procedures, we noted 1 of 40 timesheets tested in which the hours on the employee’s timesheet did not agree to the hours reported on the time study. We identified 2.5 hours of steward leave being reported on the timesheet but not the time study. Repeat Finding from Prior Year(s): No Cause and Effect: The Health System did not have proper controls in place to ensure hours reported on the timesheet agree to the hours on the time study, which could lead to inaccurate hours being reported and disbursed to employees. Questioned Cost: None Recommendation: We recommend management review policies and procedures to ensure the hours reported on the timesheet agree to the hours on the time study. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. The Health System will review, modify, and implement policies and procedures over the program to ensure that costs incurred are appropriately charged based on the contracts’ performance periods.
Finding Number 2023-006: Costs Incurred Outside Period of Performance (Significant Deficiency over Internal Control and Instances of Noncompliance – Period of Performance; Allowable Costs/Cost Principles) FALN Number 93.959 Block Grants for Prevention and Treatment of Substance Abuse, Award Number 900077, Award Year 2022-2023 Criteria: 2023 Compliance Supplement and 2 CFR 200.403(h) stated that a non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance. Condition/Context: As a result of our audit procedures, we noted 2 of 25 timesheets tested in which the costs incurred were charged outside of the program’s performance period. The two timesheets had payroll costs incurred during the pay period of 6/12/2022 – 6/25/2022; however, the contract had a performance period of 7/1/2022 – 6/30/2023. Repeat Finding from Prior Year(s): No Cause and Effect: The Health System did not have proper controls in place to ensure only costs incurred in the performance period were charged to the program, which resulted in non-compliance with program requirements. Questioned Cost: None Recommendation: We recommend management review policies and procedures of the program to ensure the costs incurred are appropriately charged based on the contracts’ performance periods. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. The Health System will review, modify, and implement policies and procedures over the program to ensure that costs incurred are appropriately charged based on the contracts’ performance periods.
Finding Number 2023-007: Costs Incurred Outside Period of Performance (Significant Deficiency over Internal Control and Instances of Noncompliance – Period of Performance; Allowable Costs/Cost Principles) FALN Number 16.575 U.S. Department of Justice, Office of Victims of Crime – Crime Victim Assistance, Award Number 94-3302014, Award Year 2022-2023 Criteria: 2023 Compliance Supplement and 2 CFR 200.403(h) stated that a non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance. Condition/Context: As a result of our audit procedures to evaluate the summary schedule of prior audit findings, we noted 1 sample of payroll expenditure of $6,561 incurred during the pay period 3/19/2023 – 4/1/2023; however, the payroll costs incurred was charged to the program based on the pay date instead of the pay period incurred. Repeat Finding from Prior Year(s): Yes, Finding Number 2022-003 Cause and Effect: The Health System did not have proper controls in place to ensure only costs incurred in the period of performance were charged to the program, which resulted in costs outside of period of performance being charged to the program. Questioned Cost: None Recommendation: We recommend management review policies and procedures of the program to ensure the costs incurred are appropriately charged based on the contracts’ performance periods. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. The Health System will review, modify, and implement policies and procedures over the program to ensure that costs incurred are appropriately charged based on the contracts’ performance periods.
Reference Number: 2023-003 Prior Year Finding: No Federal Agency: U.S. Department of Agriculture State Agency: Department of Public Health Federal Program: WIC Special Supplemental Nutrition Program for Women, Infants, and Children Assistance Listing Number: 10.557 Award Number and Year: 224MA702WI003 (10/1/2021 – 9/30/2022) Compliance Requirement: Period of Performance Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). A period of performance may contain one or more budget periods. Control: Per 2 CFR section 200.303(a), a non-Federal entity 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. These internal controls should comply 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). Condition: The Department of Public Health (Department) charged costs to the federal grant after the end of the grant’s allowable period of performance. Context: One of forty expenditure transactions selected for testing was incurred after the end of the grant’s period of performance. The period of performance ended on September 30, 2022 and the expenditure was incurred on October 10, 2022. Funds were not encumbered prior to the end of the period of performance. Cause: The Department’s procedures and internal controls were not operating sufficiently to ensure that expenditures were charged to the correct grant year. The Department had a contract in place with the vendor but did not encumber funds for the transaction prior to September 30, 2022. Therefore, the expenditures should have been charged to the FFY2023 grant period. Effect: Costs could be deemed unallowable by the awarding agency if funds are expended and/or obligated after the allowable period of performance. Questioned costs: None above reportable threshold. Recommendation: The Department should review and enhance its procedures and internal controls to ensure that it charges expenditures to the program that are incurred within an award’s allowable period of performance. The Department should ensure that it encumbers funds prior to the end of the period of performance when appropriate. Views of responsible officials: Management agrees with the finding.
Federal Agency: Department of Education Cluster/Program: Special Education Cluster AL Number(s): 84.027 Award Year: 2023 Compliance Requirement: Period of Performance Type of Finding Compliance Internal Control over Compliance – Significant Deficiency Criteria or Specific Requirement A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). Management of the School District 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 pro¬gram. 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 per¬forming 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 There were several payroll charges and invoices for costs that occurred prior to the start of the School District’s fiscal year 2023 IDEA special education grant. Since these costs occurred outside of the authorized period of performance, they are not eligible to be charged to that grant. Cause The School District has not established adequate procedures to ensure costs charged to the grant are within the authorized period of performance. Effect or Potential Effect Due to the weakness in internal control noted above, there are known and questioned costs reported related to salaries and contracted services incurred prior to the period of performance and charged to the grant. Questioned Costs The payroll charges and invoices for costs in question are below $25,000. Recommendation The School District should implement controls to ensure that no costs are incurred for a grant prior to the authorized period of performance. 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.
Condition: During testing of federal expenditures, we noted 5 out of 40 expense transactions tested thatlacked supporting documentation to validate the expense. Criteria: Per 2 CRF section 200.403(g), costs must be adequately documented. Cause of Condition: This issue was caused by inadequate policies and weakened internal controls. Effect: Failure to retain proper supporting documentation could result in noncompliance with 2 CFR 200.403(g) and/or questioned costs. Recommendation: We recommend all disbursements be supported with a receipt or invoice detailing the date, amount, and business purpose of the expenditure. This procedure will help ensure all expenditures are properly recorded and documented. Furthermore, all receipts should specify the purchase and, if for a meal purchase, the specific attendees who benefited from the expense in order to be in compliance with IRS expense guidelines. NCHE should also establish a policy regarding missing receipts. Management Response: Management accepts the finding and recommendation.
Condition: During testing of federal expenditures, we noted 5 out of 40 expense transactions tested thatlacked supporting documentation to validate the expense. Criteria: Per 2 CRF section 200.403(g), costs must be adequately documented. Cause of Condition: This issue was caused by inadequate policies and weakened internal controls. Effect: Failure to retain proper supporting documentation could result in noncompliance with 2 CFR 200.403(g) and/or questioned costs. Recommendation: We recommend all disbursements be supported with a receipt or invoice detailing the date, amount, and business purpose of the expenditure. This procedure will help ensure all expenditures are properly recorded and documented. Furthermore, all receipts should specify the purchase and, if for a meal purchase, the specific attendees who benefited from the expense in order to be in compliance with IRS expense guidelines. NCHE should also establish a policy regarding missing receipts. Management Response: Management accepts the finding and recommendation.
Condition: During testing of federal expenditures, we noted 5 out of 40 expense transactions tested thatlacked supporting documentation to validate the expense. Criteria: Per 2 CRF section 200.403(g), costs must be adequately documented. Cause of Condition: This issue was caused by inadequate policies and weakened internal controls. Effect: Failure to retain proper supporting documentation could result in noncompliance with 2 CFR 200.403(g) and/or questioned costs. Recommendation: We recommend all disbursements be supported with a receipt or invoice detailing the date, amount, and business purpose of the expenditure. This procedure will help ensure all expenditures are properly recorded and documented. Furthermore, all receipts should specify the purchase and, if for a meal purchase, the specific attendees who benefited from the expense in order to be in compliance with IRS expense guidelines. NCHE should also establish a policy regarding missing receipts. Management Response: Management accepts the finding and recommendation.
CONDITION: The District did not comply with the laws and regulations related to its participation in it’s various federal grant program reporting requirements. Personnel did not complete and submit the required ‘quarterly cash on hand reports’ and ‘final expenditure report’ (FER) for the grant programs based on supporting accurate general ledger expenditures as required by Section 2 CFR 200.403(g) of the Uniform Guidance. This is a repeat finding from (2022-002) from the previous fiscal year. CRITERIA: The PA Department of Education (PDE) and Section 2 CFR 200.403(g) of the Uniform Guidance requires the completion and submission of a ‘quarterly cash on hand report’ quarterly as needed and a ‘final expenditure report’ (FER) at the conclusion of each grant program year (including any carryover period) based on information contained in the School District’s financial management system and supported by all underlying documentation. EFFECT: The District was not in compliance with the PA Department of Education (PDE) and Section 2 CFR 200.403(g) of the Uniform Guidance financial reporting requirements relative to its participation the ESSER and ARP ESSER grant programs that require submission of ‘quarterly cash on hand reports’ and a ‘final expenditure report’ (FER) based on supporting accurate financial management system expenditures. CAUSE: The District experienced turnover in key business office personnel during the last two fiscal years, which resulted in errors in posting federal expenditures to the appropriate general ledger account codes. This further lead to inaccurate reporting as outlined above. QUESTIONED COST: None RECOMMENDATION: I recommend that the District re-file the required federal program ‘final expenditure reports’, if possible, based on accurate financial information obtained from the District’s financial management system after any corrections are made, in order to 1) comply with PDE and Uniform Guidance reporting requirements for the District’s applicable federal programs, and 2) to avoid any sanctions from PDE as a result of not filing these reports properly with accurate general ledger detail in a timely manner. All further federal grant reporting should be completed based on accurate general ledger expenditures. VIEW OF RESPONSIBLE OFFICIALS: See Correction Action Plan
CONDITION: The District did not comply with the laws and regulations related to its participation in it’s various federal grant program reporting requirements. Personnel did not complete and submit the required ‘quarterly cash on hand reports’ and ‘final expenditure report’ (FER) for the grant programs based on supporting accurate general ledger expenditures as required by Section 2 CFR 200.403(g) of the Uniform Guidance. This is a repeat finding from (2022-002) from the previous fiscal year. CRITERIA: The PA Department of Education (PDE) and Section 2 CFR 200.403(g) of the Uniform Guidance requires the completion and submission of a ‘quarterly cash on hand report’ quarterly as needed and a ‘final expenditure report’ (FER) at the conclusion of each grant program year (including any carryover period) based on information contained in the School District’s financial management system and supported by all underlying documentation. EFFECT: The District was not in compliance with the PA Department of Education (PDE) and Section 2 CFR 200.403(g) of the Uniform Guidance financial reporting requirements relative to its participation the ESSER and ARP ESSER grant programs that require submission of ‘quarterly cash on hand reports’ and a ‘final expenditure report’ (FER) based on supporting accurate financial management system expenditures. CAUSE: The District experienced turnover in key business office personnel during the last two fiscal years, which resulted in errors in posting federal expenditures to the appropriate general ledger account codes. This further lead to inaccurate reporting as outlined above. QUESTIONED COST: None RECOMMENDATION: I recommend that the District re-file the required federal program ‘final expenditure reports’, if possible, based on accurate financial information obtained from the District’s financial management system after any corrections are made, in order to 1) comply with PDE and Uniform Guidance reporting requirements for the District’s applicable federal programs, and 2) to avoid any sanctions from PDE as a result of not filing these reports properly with accurate general ledger detail in a timely manner. All further federal grant reporting should be completed based on accurate general ledger expenditures. VIEW OF RESPONSIBLE OFFICIALS: See Correction Action Plan
CONDITION: The District did not comply with the laws and regulations related to its participation in it’s various federal grant program reporting requirements. Personnel did not complete and submit the required ‘quarterly cash on hand reports’ and ‘final expenditure report’ (FER) for the grant programs based on supporting accurate general ledger expenditures as required by Section 2 CFR 200.403(g) of the Uniform Guidance. This is a repeat finding from (2022-002) from the previous fiscal year. CRITERIA: The PA Department of Education (PDE) and Section 2 CFR 200.403(g) of the Uniform Guidance requires the completion and submission of a ‘quarterly cash on hand report’ quarterly as needed and a ‘final expenditure report’ (FER) at the conclusion of each grant program year (including any carryover period) based on information contained in the School District’s financial management system and supported by all underlying documentation. EFFECT: The District was not in compliance with the PA Department of Education (PDE) and Section 2 CFR 200.403(g) of the Uniform Guidance financial reporting requirements relative to its participation the ESSER and ARP ESSER grant programs that require submission of ‘quarterly cash on hand reports’ and a ‘final expenditure report’ (FER) based on supporting accurate financial management system expenditures. CAUSE: The District experienced turnover in key business office personnel during the last two fiscal years, which resulted in errors in posting federal expenditures to the appropriate general ledger account codes. This further lead to inaccurate reporting as outlined above. QUESTIONED COST: None RECOMMENDATION: I recommend that the District re-file the required federal program ‘final expenditure reports’, if possible, based on accurate financial information obtained from the District’s financial management system after any corrections are made, in order to 1) comply with PDE and Uniform Guidance reporting requirements for the District’s applicable federal programs, and 2) to avoid any sanctions from PDE as a result of not filing these reports properly with accurate general ledger detail in a timely manner. All further federal grant reporting should be completed based on accurate general ledger expenditures. VIEW OF RESPONSIBLE OFFICIALS: See Correction Action Plan
CONDITION: The District did not comply with the laws and regulations related to its participation in it’s various federal grant program reporting requirements. Personnel did not complete and submit the required ‘quarterly cash on hand reports’ and ‘final expenditure report’ (FER) for the grant programs based on supporting accurate general ledger expenditures as required by Section 2 CFR 200.403(g) of the Uniform Guidance. This is a repeat finding from (2022-002) from the previous fiscal year. CRITERIA: The PA Department of Education (PDE) and Section 2 CFR 200.403(g) of the Uniform Guidance requires the completion and submission of a ‘quarterly cash on hand report’ quarterly as needed and a ‘final expenditure report’ (FER) at the conclusion of each grant program year (including any carryover period) based on information contained in the School District’s financial management system and supported by all underlying documentation. EFFECT: The District was not in compliance with the PA Department of Education (PDE) and Section 2 CFR 200.403(g) of the Uniform Guidance financial reporting requirements relative to its participation the ESSER and ARP ESSER grant programs that require submission of ‘quarterly cash on hand reports’ and a ‘final expenditure report’ (FER) based on supporting accurate financial management system expenditures. CAUSE: The District experienced turnover in key business office personnel during the last two fiscal years, which resulted in errors in posting federal expenditures to the appropriate general ledger account codes. This further lead to inaccurate reporting as outlined above. QUESTIONED COST: None RECOMMENDATION: I recommend that the District re-file the required federal program ‘final expenditure reports’, if possible, based on accurate financial information obtained from the District’s financial management system after any corrections are made, in order to 1) comply with PDE and Uniform Guidance reporting requirements for the District’s applicable federal programs, and 2) to avoid any sanctions from PDE as a result of not filing these reports properly with accurate general ledger detail in a timely manner. All further federal grant reporting should be completed based on accurate general ledger expenditures. VIEW OF RESPONSIBLE OFFICIALS: See Correction Action Plan
Finding 2023-039: U. S. Department of Education ALN #84.371 Comprehensive Literacy Development Program Grant #S371C190012, S371C190012-19A, S371C190012-20, S371C190012-21 Criteria: Federal regulation, 2 CFR 200.332(d), requires pass-through entities to “Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved.” Federal regulation, 2 CFR Part 200.403(a) and (g), require costs to be necessary and reasonable, as well as adequately documented. Federal regulation, 2 CFR 200.303, requires non-Federal entities to, among other things, establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: The Office of Public Instruction (office) subrecipient monitoring process related to the Comprehensive Literacy State Development Program did not include obtaining sufficient documentation on cash requests to ensure funds were used for allowable activities and costs as required by federal regulations. This is also a control deficiency related to activities allowed, allowable costs, and subrecipient monitoring. Questioned Costs: We question $659,331 of the cash requests we reviewed. There may be more questioned costs for items we did not review. Context: We sampled 22 cash requests from 10 Local Educational Agencies (LEAs) out of a population of 120 LEAs. The total amount of cash requested for these sample items was $886,597. The sample was not statistically valid. Twelve cash requests lacked adequate detail to determine if all the costs were for allowable activities and costs. Four of the errors, totaling $254,234 were related to the final cash requests, where there was no documentation on how the LEA spent the remaining funds. The other eight requests did not contain adequate support to ensure the costs were reasonable and necessary. For example, one cash request’s description said, “Lease payments for Literacy van to transport students to afterschool program.” The LEA requested $29,519, split between pre-k, elementary, middle, and high school. We do not believe the support had enough detail for the office to determine the time period covered by the request, if the lease payment was excessive, or if the lease was for more than one van. Effect: Without adequate controls over cash requests, the office has reimbursed subrecipients for expenses that may be unallowable, or unnecessary and unreasonable for performance of the federal award. The office did not comply with federal regulations related to activities allowed, allowable costs, and subrecipient monitoring. Cause: The office agrees that LEAs do not always providing sufficient descriptions in cash requests, but they noted program staff visited LEAs at least bi-monthly to physically review items that the money was spent on at the beginning of the grant, with continued visits as needed during the audit period. However, based on our follow up, the onsite reviews did not include reviewing the support the LEA retains for purchases related to cash requests. Instead, they focused on other subrecipient monitoring activities, such as reviewing evidence of the impact of expenditures, like improved reading scores. While useful, these activities do not address concerns about cash request documentation, because there is no evidence that the office reimbursed the actual amount spent. Recommendation: We recommend the Office of Public Instruction: A. Strengthen subrecipient monitoring internal controls to ensure subrecipient grant expenditures are for allowable costs and activities. B. Obtain sufficient documentation of subrecipient expenditures to ensure compliance with federal awards requirements. Views of Responsible Officials: The office partially concurs with the recommendation. Management notes that they increased the documentation requirements for cash requests at the end of the first year of the audit period. LEAs are required to maintain all receipts and provide them upon request. Management also notes no request for additional LEA documentation was included as part of this audit process. Rebuttal of Views of Responsible Officials: We considered the office’s partial concurrence. Cash requests from both years of the audit period were tested, and instances of insufficient documentation were found throughout the audit period. While we are not prohibited from requesting subrecipients’ documentation during an audit, we are not required to do so. It is our position that unless the office maintains documentation, or documents their monitoring activities, compliance with the requirements applicable to the office cannot be demonstrated. As such, our recommendation stands.
Finding 2023-039: U. S. Department of Education ALN #84.371 Comprehensive Literacy Development Program Grant #S371C190012, S371C190012-19A, S371C190012-20, S371C190012-21 Criteria: Federal regulation, 2 CFR 200.332(d), requires pass-through entities to “Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved.” Federal regulation, 2 CFR Part 200.403(a) and (g), require costs to be necessary and reasonable, as well as adequately documented. Federal regulation, 2 CFR 200.303, requires non-Federal entities to, among other things, establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: The Office of Public Instruction (office) subrecipient monitoring process related to the Comprehensive Literacy State Development Program did not include obtaining sufficient documentation on cash requests to ensure funds were used for allowable activities and costs as required by federal regulations. This is also a control deficiency related to activities allowed, allowable costs, and subrecipient monitoring. Questioned Costs: We question $659,331 of the cash requests we reviewed. There may be more questioned costs for items we did not review. Context: We sampled 22 cash requests from 10 Local Educational Agencies (LEAs) out of a population of 120 LEAs. The total amount of cash requested for these sample items was $886,597. The sample was not statistically valid. Twelve cash requests lacked adequate detail to determine if all the costs were for allowable activities and costs. Four of the errors, totaling $254,234 were related to the final cash requests, where there was no documentation on how the LEA spent the remaining funds. The other eight requests did not contain adequate support to ensure the costs were reasonable and necessary. For example, one cash request’s description said, “Lease payments for Literacy van to transport students to afterschool program.” The LEA requested $29,519, split between pre-k, elementary, middle, and high school. We do not believe the support had enough detail for the office to determine the time period covered by the request, if the lease payment was excessive, or if the lease was for more than one van. Effect: Without adequate controls over cash requests, the office has reimbursed subrecipients for expenses that may be unallowable, or unnecessary and unreasonable for performance of the federal award. The office did not comply with federal regulations related to activities allowed, allowable costs, and subrecipient monitoring. Cause: The office agrees that LEAs do not always providing sufficient descriptions in cash requests, but they noted program staff visited LEAs at least bi-monthly to physically review items that the money was spent on at the beginning of the grant, with continued visits as needed during the audit period. However, based on our follow up, the onsite reviews did not include reviewing the support the LEA retains for purchases related to cash requests. Instead, they focused on other subrecipient monitoring activities, such as reviewing evidence of the impact of expenditures, like improved reading scores. While useful, these activities do not address concerns about cash request documentation, because there is no evidence that the office reimbursed the actual amount spent. Recommendation: We recommend the Office of Public Instruction: A. Strengthen subrecipient monitoring internal controls to ensure subrecipient grant expenditures are for allowable costs and activities. B. Obtain sufficient documentation of subrecipient expenditures to ensure compliance with federal awards requirements. Views of Responsible Officials: The office partially concurs with the recommendation. Management notes that they increased the documentation requirements for cash requests at the end of the first year of the audit period. LEAs are required to maintain all receipts and provide them upon request. Management also notes no request for additional LEA documentation was included as part of this audit process. Rebuttal of Views of Responsible Officials: We considered the office’s partial concurrence. Cash requests from both years of the audit period were tested, and instances of insufficient documentation were found throughout the audit period. While we are not prohibited from requesting subrecipients’ documentation during an audit, we are not required to do so. It is our position that unless the office maintains documentation, or documents their monitoring activities, compliance with the requirements applicable to the office cannot be demonstrated. As such, our recommendation stands.
Finding 2023-032: U.S. Department of Education ALN #84.425D and #84.425U, Education Stabilization Fund (ESF) (COVID-19) Grant #S425D200006, S425D210006, and S452U210006-21A Criteria: Federal regulation, 2CFR 200.332(d), requires pass through entities to "Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved." The Office of Management and Budget 2022 Compliance Supplement (compliance supplement), ESF Program (Section III, Part F-Equipment /Real Property Management) explains that construction projects using Elementary and Secondary School Emergency Relief Fund (ESSER funds) must meet Davis-Bacon prevailing wage requirements, meaning they must pay wages based on federal requirements. A memo from the Department of Education related to Davis-Bacon released April 2023 further clarified that states should be collecting and monitoring all Local Educational Agencies’ (LEA) wage certifications. The compliance supplement (Section III, Part A Activities Allowed or Unallowed) also requires costs to be consistent with the purpose of the ESF, “to prevent, prepare for, and respond to COVID-19”. Federal regulation, 2 CFR 200.403 (a) and (g), requires allowable costs to be “necessary and reasonable for the performance of the Federal award” and to be “adequately documented”. Federal regulation, 2 CFR 200.303, requires non-Federal entities to, among other things, establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: ESSER is part of the ESF. The Office of Public Instruction’s (office) controls were not sufficient to prevent, or detect and correct, noncompliance with federal requirements during the audit period. The office assessed subrecipients risk, reviewed audit reports for LEAs whose audits included ESSER as a major program, and required subrecipients to document their use of ESSER funds on cash requests. However, the office did not comply with federal allowable cost regulations. This is because they did not require documentation beyond the cash requests to ensure those expenditures followed ESSER program requirements. Examples include being related to the COVID-19 pandemic, being reasonable and necessary, and complying with equipment and construction requirements. In addition, the office did not complete any after the award monitoring, including collecting Davis-Bacon wage certifications related to subrecipients’ construction projects as required by federal regulations. Questioned Costs: We question costs of over $52 million. Specifically, $19,748,561 for 84.425D (ESSER I and II) and $32,288,058 for 84.425U (ESSER III). We calculated this amount by summing the payments from the cash draws we tested that lacked sufficient documentation. The potential questioned costs could be higher since our testing was limited to cash requests over $1 million. Context: During the audit period, over $257 million of ESSER grants were paid to LEAs. We tested 27 ESSER cash requests over $1 million each in fiscal years 2022 and 2023. Total payments made to subrecipients from these cash draws exceeded $77 million. We first considered support retained at the office. We also requested further support from LEAs in an attempt to consider all information available. Not all requested support was provided. We reviewed what was provided as part of our testing. This was not a sample as we tested all cash requests above $1 million. Each cash request contained a variety of items on the same request. We noted the following: • Documentation in 12 out of the 27 cash requests tested did not indicate how the expenses related to preventing, preparing for, and responding to COVID-19 pandemic. • 14 out of the 27 cash requests tested did not have enough detail to determine if the costs were reasonable and necessary. • 12 of the cash requests reviewed involved construction and the office did not review any wage certifications during the audit period. In addition, there was no monitoring of LEAs’ compliance related to equipment and real property management requirements beyond compliance certifications by the LEAs. • Descriptions on two cash requests indicated ESSER funds were spent on items we believe are unreasonable or have no clear connection to the pandemic. These costs include t-shirts for a new teacher event and massage chairs for a teacher’s lounge. Overall, the cash requests are more detailed than in the prior audit, but they still are not sufficient to meet the office’s obligation to ensure subrecipients’ compliance with federal regulations. In addition, fiscal year 2023 was the third year of ESSER spending, indicating there has been time to set up an after the award subrecipient monitoring program. Repeat Finding: This is a repeat finding and was reported as Single Audit finding 2021-036 in the audit for the two fiscal years ended June 30, 2021. Effect: The office is not in compliance with federal regulations and subrecipients may have spent ESSER funds on activities not allowed by federal requirements, to prevent, prepare for, and respond to the coronavirus pandemic, or on items that are not necessary and reasonable for the performance of the federal award. Cause: The office believes there was sufficient detail on the cash requests for the office to decide on the reasonableness, necessity, and allowability under ESSER regulations. The office agrees that subrecipient monitoring was not sufficient during the audit period, but since there are three funding sources that all have the same allowable uses, personnel decided they would monitor all phases of the grant using one self-assessment. The office sent out a monitoring survey at the end of the audit period, but no responses had been received during fiscal year 2023. The office noted that they will conduct additional monitoring, particularly for unique activities like construction projects, to ensure ESSER compliance. ESSER is defined in the compliance supplement as a “higher risk” federal program, because of the additional risk associated with certain COVID-19 funding. We believe the office’s decision to monitor three years into the grant is not sufficient for the following reasons: • LEAs spent funds on unusual activity, like construction projects. These projects have different compliance requirements than the other federal grants most LEAs receive. • Less than 20 percent of LEA ESSER subrecipients will receive an audit that requires any federal compliance testing. • If the office finds issues this late in the grant process, it will be difficult to recover funds from LEAs. We believe federal requirements direct the office to use a combination of sufficient documentation at the time of disbursement and strong monitoring procedures to ensure LEAs properly comply with applicable allowable cost requirements. Recommendation: We recommend the Office of Public Instruction: A. Strengthen internal controls to ensure subrecipient grant expenditures comply with federal program requirements. B. Obtain sufficient documentation of subrecipient expenditures to ensure costs are related to the pandemic and are reasonable and necessary for performance of the federal award. C. Monitor subrecipients’ compliance with construction and equipment requirements, including reviewing wage certifications for construction projects. Views of Responsible Officials: The office concurs with the recommendation. For additional information regarding the office’s planned corrective action see the Corrective Action Plan starting on page D-1.
Finding 2023-032: U.S. Department of Education ALN #84.425D and #84.425U, Education Stabilization Fund (ESF) (COVID-19) Grant #S425D200006, S425D210006, and S452U210006-21A Criteria: Federal regulation, 2CFR 200.332(d), requires pass through entities to "Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved." The Office of Management and Budget 2022 Compliance Supplement (compliance supplement), ESF Program (Section III, Part F-Equipment /Real Property Management) explains that construction projects using Elementary and Secondary School Emergency Relief Fund (ESSER funds) must meet Davis-Bacon prevailing wage requirements, meaning they must pay wages based on federal requirements. A memo from the Department of Education related to Davis-Bacon released April 2023 further clarified that states should be collecting and monitoring all Local Educational Agencies’ (LEA) wage certifications. The compliance supplement (Section III, Part A Activities Allowed or Unallowed) also requires costs to be consistent with the purpose of the ESF, “to prevent, prepare for, and respond to COVID-19”. Federal regulation, 2 CFR 200.403 (a) and (g), requires allowable costs to be “necessary and reasonable for the performance of the Federal award” and to be “adequately documented”. Federal regulation, 2 CFR 200.303, requires non-Federal entities to, among other things, establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: ESSER is part of the ESF. The Office of Public Instruction’s (office) controls were not sufficient to prevent, or detect and correct, noncompliance with federal requirements during the audit period. The office assessed subrecipients risk, reviewed audit reports for LEAs whose audits included ESSER as a major program, and required subrecipients to document their use of ESSER funds on cash requests. However, the office did not comply with federal allowable cost regulations. This is because they did not require documentation beyond the cash requests to ensure those expenditures followed ESSER program requirements. Examples include being related to the COVID-19 pandemic, being reasonable and necessary, and complying with equipment and construction requirements. In addition, the office did not complete any after the award monitoring, including collecting Davis-Bacon wage certifications related to subrecipients’ construction projects as required by federal regulations. Questioned Costs: We question costs of over $52 million. Specifically, $19,748,561 for 84.425D (ESSER I and II) and $32,288,058 for 84.425U (ESSER III). We calculated this amount by summing the payments from the cash draws we tested that lacked sufficient documentation. The potential questioned costs could be higher since our testing was limited to cash requests over $1 million. Context: During the audit period, over $257 million of ESSER grants were paid to LEAs. We tested 27 ESSER cash requests over $1 million each in fiscal years 2022 and 2023. Total payments made to subrecipients from these cash draws exceeded $77 million. We first considered support retained at the office. We also requested further support from LEAs in an attempt to consider all information available. Not all requested support was provided. We reviewed what was provided as part of our testing. This was not a sample as we tested all cash requests above $1 million. Each cash request contained a variety of items on the same request. We noted the following: • Documentation in 12 out of the 27 cash requests tested did not indicate how the expenses related to preventing, preparing for, and responding to COVID-19 pandemic. • 14 out of the 27 cash requests tested did not have enough detail to determine if the costs were reasonable and necessary. • 12 of the cash requests reviewed involved construction and the office did not review any wage certifications during the audit period. In addition, there was no monitoring of LEAs’ compliance related to equipment and real property management requirements beyond compliance certifications by the LEAs. • Descriptions on two cash requests indicated ESSER funds were spent on items we believe are unreasonable or have no clear connection to the pandemic. These costs include t-shirts for a new teacher event and massage chairs for a teacher’s lounge. Overall, the cash requests are more detailed than in the prior audit, but they still are not sufficient to meet the office’s obligation to ensure subrecipients’ compliance with federal regulations. In addition, fiscal year 2023 was the third year of ESSER spending, indicating there has been time to set up an after the award subrecipient monitoring program. Repeat Finding: This is a repeat finding and was reported as Single Audit finding 2021-036 in the audit for the two fiscal years ended June 30, 2021. Effect: The office is not in compliance with federal regulations and subrecipients may have spent ESSER funds on activities not allowed by federal requirements, to prevent, prepare for, and respond to the coronavirus pandemic, or on items that are not necessary and reasonable for the performance of the federal award. Cause: The office believes there was sufficient detail on the cash requests for the office to decide on the reasonableness, necessity, and allowability under ESSER regulations. The office agrees that subrecipient monitoring was not sufficient during the audit period, but since there are three funding sources that all have the same allowable uses, personnel decided they would monitor all phases of the grant using one self-assessment. The office sent out a monitoring survey at the end of the audit period, but no responses had been received during fiscal year 2023. The office noted that they will conduct additional monitoring, particularly for unique activities like construction projects, to ensure ESSER compliance. ESSER is defined in the compliance supplement as a “higher risk” federal program, because of the additional risk associated with certain COVID-19 funding. We believe the office’s decision to monitor three years into the grant is not sufficient for the following reasons: • LEAs spent funds on unusual activity, like construction projects. These projects have different compliance requirements than the other federal grants most LEAs receive. • Less than 20 percent of LEA ESSER subrecipients will receive an audit that requires any federal compliance testing. • If the office finds issues this late in the grant process, it will be difficult to recover funds from LEAs. We believe federal requirements direct the office to use a combination of sufficient documentation at the time of disbursement and strong monitoring procedures to ensure LEAs properly comply with applicable allowable cost requirements. Recommendation: We recommend the Office of Public Instruction: A. Strengthen internal controls to ensure subrecipient grant expenditures comply with federal program requirements. B. Obtain sufficient documentation of subrecipient expenditures to ensure costs are related to the pandemic and are reasonable and necessary for performance of the federal award. C. Monitor subrecipients’ compliance with construction and equipment requirements, including reviewing wage certifications for construction projects. Views of Responsible Officials: The office concurs with the recommendation. For additional information regarding the office’s planned corrective action see the Corrective Action Plan starting on page D-1.
Finding 2023-032: U.S. Department of Education ALN #84.425D and #84.425U, Education Stabilization Fund (ESF) (COVID-19) Grant #S425D200006, S425D210006, and S452U210006-21A Criteria: Federal regulation, 2CFR 200.332(d), requires pass through entities to "Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved." The Office of Management and Budget 2022 Compliance Supplement (compliance supplement), ESF Program (Section III, Part F-Equipment /Real Property Management) explains that construction projects using Elementary and Secondary School Emergency Relief Fund (ESSER funds) must meet Davis-Bacon prevailing wage requirements, meaning they must pay wages based on federal requirements. A memo from the Department of Education related to Davis-Bacon released April 2023 further clarified that states should be collecting and monitoring all Local Educational Agencies’ (LEA) wage certifications. The compliance supplement (Section III, Part A Activities Allowed or Unallowed) also requires costs to be consistent with the purpose of the ESF, “to prevent, prepare for, and respond to COVID-19”. Federal regulation, 2 CFR 200.403 (a) and (g), requires allowable costs to be “necessary and reasonable for the performance of the Federal award” and to be “adequately documented”. Federal regulation, 2 CFR 200.303, requires non-Federal entities to, among other things, establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: ESSER is part of the ESF. The Office of Public Instruction’s (office) controls were not sufficient to prevent, or detect and correct, noncompliance with federal requirements during the audit period. The office assessed subrecipients risk, reviewed audit reports for LEAs whose audits included ESSER as a major program, and required subrecipients to document their use of ESSER funds on cash requests. However, the office did not comply with federal allowable cost regulations. This is because they did not require documentation beyond the cash requests to ensure those expenditures followed ESSER program requirements. Examples include being related to the COVID-19 pandemic, being reasonable and necessary, and complying with equipment and construction requirements. In addition, the office did not complete any after the award monitoring, including collecting Davis-Bacon wage certifications related to subrecipients’ construction projects as required by federal regulations. Questioned Costs: We question costs of over $52 million. Specifically, $19,748,561 for 84.425D (ESSER I and II) and $32,288,058 for 84.425U (ESSER III). We calculated this amount by summing the payments from the cash draws we tested that lacked sufficient documentation. The potential questioned costs could be higher since our testing was limited to cash requests over $1 million. Context: During the audit period, over $257 million of ESSER grants were paid to LEAs. We tested 27 ESSER cash requests over $1 million each in fiscal years 2022 and 2023. Total payments made to subrecipients from these cash draws exceeded $77 million. We first considered support retained at the office. We also requested further support from LEAs in an attempt to consider all information available. Not all requested support was provided. We reviewed what was provided as part of our testing. This was not a sample as we tested all cash requests above $1 million. Each cash request contained a variety of items on the same request. We noted the following: • Documentation in 12 out of the 27 cash requests tested did not indicate how the expenses related to preventing, preparing for, and responding to COVID-19 pandemic. • 14 out of the 27 cash requests tested did not have enough detail to determine if the costs were reasonable and necessary. • 12 of the cash requests reviewed involved construction and the office did not review any wage certifications during the audit period. In addition, there was no monitoring of LEAs’ compliance related to equipment and real property management requirements beyond compliance certifications by the LEAs. • Descriptions on two cash requests indicated ESSER funds were spent on items we believe are unreasonable or have no clear connection to the pandemic. These costs include t-shirts for a new teacher event and massage chairs for a teacher’s lounge. Overall, the cash requests are more detailed than in the prior audit, but they still are not sufficient to meet the office’s obligation to ensure subrecipients’ compliance with federal regulations. In addition, fiscal year 2023 was the third year of ESSER spending, indicating there has been time to set up an after the award subrecipient monitoring program. Repeat Finding: This is a repeat finding and was reported as Single Audit finding 2021-036 in the audit for the two fiscal years ended June 30, 2021. Effect: The office is not in compliance with federal regulations and subrecipients may have spent ESSER funds on activities not allowed by federal requirements, to prevent, prepare for, and respond to the coronavirus pandemic, or on items that are not necessary and reasonable for the performance of the federal award. Cause: The office believes there was sufficient detail on the cash requests for the office to decide on the reasonableness, necessity, and allowability under ESSER regulations. The office agrees that subrecipient monitoring was not sufficient during the audit period, but since there are three funding sources that all have the same allowable uses, personnel decided they would monitor all phases of the grant using one self-assessment. The office sent out a monitoring survey at the end of the audit period, but no responses had been received during fiscal year 2023. The office noted that they will conduct additional monitoring, particularly for unique activities like construction projects, to ensure ESSER compliance. ESSER is defined in the compliance supplement as a “higher risk” federal program, because of the additional risk associated with certain COVID-19 funding. We believe the office’s decision to monitor three years into the grant is not sufficient for the following reasons: • LEAs spent funds on unusual activity, like construction projects. These projects have different compliance requirements than the other federal grants most LEAs receive. • Less than 20 percent of LEA ESSER subrecipients will receive an audit that requires any federal compliance testing. • If the office finds issues this late in the grant process, it will be difficult to recover funds from LEAs. We believe federal requirements direct the office to use a combination of sufficient documentation at the time of disbursement and strong monitoring procedures to ensure LEAs properly comply with applicable allowable cost requirements. Recommendation: We recommend the Office of Public Instruction: A. Strengthen internal controls to ensure subrecipient grant expenditures comply with federal program requirements. B. Obtain sufficient documentation of subrecipient expenditures to ensure costs are related to the pandemic and are reasonable and necessary for performance of the federal award. C. Monitor subrecipients’ compliance with construction and equipment requirements, including reviewing wage certifications for construction projects. Views of Responsible Officials: The office concurs with the recommendation. For additional information regarding the office’s planned corrective action see the Corrective Action Plan starting on page D-1.
Finding 2023-032: U.S. Department of Education ALN #84.425D and #84.425U, Education Stabilization Fund (ESF) (COVID-19) Grant #S425D200006, S425D210006, and S452U210006-21A Criteria: Federal regulation, 2CFR 200.332(d), requires pass through entities to "Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved." The Office of Management and Budget 2022 Compliance Supplement (compliance supplement), ESF Program (Section III, Part F-Equipment /Real Property Management) explains that construction projects using Elementary and Secondary School Emergency Relief Fund (ESSER funds) must meet Davis-Bacon prevailing wage requirements, meaning they must pay wages based on federal requirements. A memo from the Department of Education related to Davis-Bacon released April 2023 further clarified that states should be collecting and monitoring all Local Educational Agencies’ (LEA) wage certifications. The compliance supplement (Section III, Part A Activities Allowed or Unallowed) also requires costs to be consistent with the purpose of the ESF, “to prevent, prepare for, and respond to COVID-19”. Federal regulation, 2 CFR 200.403 (a) and (g), requires allowable costs to be “necessary and reasonable for the performance of the Federal award” and to be “adequately documented”. Federal regulation, 2 CFR 200.303, requires non-Federal entities to, among other things, establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: ESSER is part of the ESF. The Office of Public Instruction’s (office) controls were not sufficient to prevent, or detect and correct, noncompliance with federal requirements during the audit period. The office assessed subrecipients risk, reviewed audit reports for LEAs whose audits included ESSER as a major program, and required subrecipients to document their use of ESSER funds on cash requests. However, the office did not comply with federal allowable cost regulations. This is because they did not require documentation beyond the cash requests to ensure those expenditures followed ESSER program requirements. Examples include being related to the COVID-19 pandemic, being reasonable and necessary, and complying with equipment and construction requirements. In addition, the office did not complete any after the award monitoring, including collecting Davis-Bacon wage certifications related to subrecipients’ construction projects as required by federal regulations. Questioned Costs: We question costs of over $52 million. Specifically, $19,748,561 for 84.425D (ESSER I and II) and $32,288,058 for 84.425U (ESSER III). We calculated this amount by summing the payments from the cash draws we tested that lacked sufficient documentation. The potential questioned costs could be higher since our testing was limited to cash requests over $1 million. Context: During the audit period, over $257 million of ESSER grants were paid to LEAs. We tested 27 ESSER cash requests over $1 million each in fiscal years 2022 and 2023. Total payments made to subrecipients from these cash draws exceeded $77 million. We first considered support retained at the office. We also requested further support from LEAs in an attempt to consider all information available. Not all requested support was provided. We reviewed what was provided as part of our testing. This was not a sample as we tested all cash requests above $1 million. Each cash request contained a variety of items on the same request. We noted the following: • Documentation in 12 out of the 27 cash requests tested did not indicate how the expenses related to preventing, preparing for, and responding to COVID-19 pandemic. • 14 out of the 27 cash requests tested did not have enough detail to determine if the costs were reasonable and necessary. • 12 of the cash requests reviewed involved construction and the office did not review any wage certifications during the audit period. In addition, there was no monitoring of LEAs’ compliance related to equipment and real property management requirements beyond compliance certifications by the LEAs. • Descriptions on two cash requests indicated ESSER funds were spent on items we believe are unreasonable or have no clear connection to the pandemic. These costs include t-shirts for a new teacher event and massage chairs for a teacher’s lounge. Overall, the cash requests are more detailed than in the prior audit, but they still are not sufficient to meet the office’s obligation to ensure subrecipients’ compliance with federal regulations. In addition, fiscal year 2023 was the third year of ESSER spending, indicating there has been time to set up an after the award subrecipient monitoring program. Repeat Finding: This is a repeat finding and was reported as Single Audit finding 2021-036 in the audit for the two fiscal years ended June 30, 2021. Effect: The office is not in compliance with federal regulations and subrecipients may have spent ESSER funds on activities not allowed by federal requirements, to prevent, prepare for, and respond to the coronavirus pandemic, or on items that are not necessary and reasonable for the performance of the federal award. Cause: The office believes there was sufficient detail on the cash requests for the office to decide on the reasonableness, necessity, and allowability under ESSER regulations. The office agrees that subrecipient monitoring was not sufficient during the audit period, but since there are three funding sources that all have the same allowable uses, personnel decided they would monitor all phases of the grant using one self-assessment. The office sent out a monitoring survey at the end of the audit period, but no responses had been received during fiscal year 2023. The office noted that they will conduct additional monitoring, particularly for unique activities like construction projects, to ensure ESSER compliance. ESSER is defined in the compliance supplement as a “higher risk” federal program, because of the additional risk associated with certain COVID-19 funding. We believe the office’s decision to monitor three years into the grant is not sufficient for the following reasons: • LEAs spent funds on unusual activity, like construction projects. These projects have different compliance requirements than the other federal grants most LEAs receive. • Less than 20 percent of LEA ESSER subrecipients will receive an audit that requires any federal compliance testing. • If the office finds issues this late in the grant process, it will be difficult to recover funds from LEAs. We believe federal requirements direct the office to use a combination of sufficient documentation at the time of disbursement and strong monitoring procedures to ensure LEAs properly comply with applicable allowable cost requirements. Recommendation: We recommend the Office of Public Instruction: A. Strengthen internal controls to ensure subrecipient grant expenditures comply with federal program requirements. B. Obtain sufficient documentation of subrecipient expenditures to ensure costs are related to the pandemic and are reasonable and necessary for performance of the federal award. C. Monitor subrecipients’ compliance with construction and equipment requirements, including reviewing wage certifications for construction projects. Views of Responsible Officials: The office concurs with the recommendation. For additional information regarding the office’s planned corrective action see the Corrective Action Plan starting on page D-1.