Information on the federal program: Subject: Special Education Cluster – Internal Controls Federal Agency: Department of Education Federal Program: Special Education Cluster Assistance Listing Number: 84.027X Federal Award Numbers and Years (or Other Identifying Numbers): 22611-122-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Period of Performance Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.309 states: "A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in § 200.461 Publication and printing costs) 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. Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the period of performance compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with the period of performance requirement. The School Corporation did not have a design control in place to ensure that service provider invoices were paid before the required liquidation date. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. Questioned Costs: There were no questioned costs identified. Context: The School Corporation pays one hundred percent of its Special Education Cluster funding to one service provider. From review of the expense population, we noted 2 payments to the service provider where the service provider was not paid until after liquidation date of December 29, 2023. The School Corporation did not pay the service provider until April 30, 2024 for $258,488 for the services provided. Identification as a repeat finding: No. Recommendation: We recommend the School Corporation implement procedures to ensure the invoices are paid before the required liquidation date. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
Information on the federal program: Subject: Special Education Cluster – Internal Controls Federal Agency: Department of Education Federal Program: Special Education Cluster Assistance Listing Number: 84.027X Federal Award Numbers and Years (or Other Identifying Numbers): 22611-122-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Period of Performance Audit Finding: Material Weakness Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.309 states: "A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in § 200.461 Publication and printing costs) 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. Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the period of performance compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with the period of performance requirement. The School Corporation did not have a design control in place to ensure that service provider invoices were paid before the required liquidation date. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. Questioned Costs: There were no questioned costs identified. Context: The School Corporation pays one hundred percent of its Special Education Cluster funding to one service provider. From review of the expense population, we noted 2 payments to the service provider where the service provider was not paid until after liquidation date of December 29, 2023. The School Corporation did not pay the service provider until April 30, 2024 for $258,488 for the services provided. Identification as a repeat finding: No. Recommendation: We recommend the School Corporation implement procedures to ensure the invoices are paid before the required liquidation date. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.
Department of Labor and Industry Finding 2023 – 018: ALN 84.126 – Rehabilitation Services – Vocational Rehabilitation Grants to States A Significant Deficiency and Noncompliance Exist in the Department of Labor and Industry’s Procedures Related to Period of Performance Requirements Federal Grant Number(s) and Year(s): H126A210056 (10/01/2020 – 9/30/2022) Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Compliance Requirement: Period of Performance Condition: During our audit of the Rehabilitation Services – Vocational Rehabilitation Grants to States (RS-VR) program, we tested internal control over and compliance with period of performance requirements for the grant awarded by the United States Department of Education that had a period of performance date ending during the fiscal year ended June 30, 2023 audit period. • Two of 55 expenditures tested that were charged to the federal fiscal year 2021 RS-VR grant that closed during the audit period, were incurred after the allowable period of performance. These expenditures included two rental payments totaling $8,763. Both payments were for November 2022 rental charges but were charged to the grant which had a period end date of September 30, 2022. Expenditures posted in the last month of the allowable period of performance and after (including the two rental payments) totaled $36,651,862. Management was unable to provide authorization from the federal awarding agency for allowance of the expenditures occurring outside of the period of performance. Criteria: 2 CFR Section 200.303(a), Internal controls, states: The 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 be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR Section 200.309, Period of performance, states: A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in §200.461 Publication and printing costs) and any costs incurred before the Federal awarding agency or pass-through entity made the award that were authorized by the Federal awarding agency or pass-through entity. Management Directive 325.12, Amended, Standards for Enterprise Risk Management in Commonwealth Agencies, adopted the internal control framework outlined in the United States Government Accountability Office’s Standards for Internal Control in the Federal Government (Green Book). The Green Book states in part: Management should establish and operate monitoring activities to monitor the internal control system and evaluate the results. Management should remediate identified internal control deficiencies on a timely basis. Finding 2023 – 018: (continued) Cause: Office of Vocational Rehabilitation (OVR), Pennsylvania Department of Labor and Industry personnel did not check service dates prior to submitting invoices for payment which were charged to the federal fiscal year 2021 grant. OVR personnel did not have adequate procedures in place to ensure that only costs incurred during the allowable period of performance were charged to the grant. Effect: Expenditures outside of the allowable period of performance were incorrectly charged to the grant without authorization by the federal awarding agency, resulting in noncompliance and questioned costs. Recommendation: We recommend that OVR personnel implement procedures to ensure that costs and adjustments being charged to a federal grant are incurred within the allowable period of performance of the grant to which they are being charged, or when necessary, obtain authorization from the federal awarding agency prior to charging costs that are outside the allowable period of performance. Agency Response: OVR agrees with this finding. Questioned Costs: Known questioned costs of $8,763 were determined, which represents the amount of transactions incurred and charged to the federal grant outside the allowable period of performance.
Finding 2023-002: Period of Performance Information on the Federal Program: 93.368 Criteria: 2 CFR §200.309 non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in §200.461 Publication and printing costs) 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. Condition: In testing the Foundation's compliance with the period of performance availability for Federal awards, we noted one instance in which an invoice for an expense incurred outside of both the award's period of performance and the Foundation's fiscal year-end was recorded and charged to the Federal award. Cause: The Foundation's controls are not adequately designed to detect an expense recorded outside of the award's period of performance or outside of the Foundation's fiscal year-end. Effect: Costs that are not incurred and recorded within the period of performance may be determined and considered an unallowable charge against a Federally funded program. Questioned Costs: $55,000 Context: Our audit procedures consisted of testwork completed on individual expenditures charged to the Federal awards that ended within the 2023 fiscal year-end. The report in which samples were selected was generated directly from the Foundation's general ledger (accounting system). We consider our sample to be representative of the population. Identification as a Repeat Finding: Not a repeat finding. Recommendation: We recommend that all invoices be reviewed to ensure that expenses are appropriately recorded in the period for which they are incurred.
Department of Labor and Industry Finding 2023 – 018: ALN 84.126 – Rehabilitation Services – Vocational Rehabilitation Grants to States A Significant Deficiency and Noncompliance Exist in the Department of Labor and Industry’s Procedures Related to Period of Performance Requirements Federal Grant Number(s) and Year(s): H126A210056 (10/01/2020 – 9/30/2022) Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Compliance Requirement: Period of Performance Condition: During our audit of the Rehabilitation Services – Vocational Rehabilitation Grants to States (RS-VR) program, we tested internal control over and compliance with period of performance requirements for the grant awarded by the United States Department of Education that had a period of performance date ending during the fiscal year ended June 30, 2023 audit period. • Two of 55 expenditures tested that were charged to the federal fiscal year 2021 RS-VR grant that closed during the audit period, were incurred after the allowable period of performance. These expenditures included two rental payments totaling $8,763. Both payments were for November 2022 rental charges but were charged to the grant which had a period end date of September 30, 2022. Expenditures posted in the last month of the allowable period of performance and after (including the two rental payments) totaled $36,651,862. Management was unable to provide authorization from the federal awarding agency for allowance of the expenditures occurring outside of the period of performance. Criteria: 2 CFR Section 200.303(a), Internal controls, states: The 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 be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR Section 200.309, Period of performance, states: A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in §200.461 Publication and printing costs) and any costs incurred before the Federal awarding agency or pass-through entity made the award that were authorized by the Federal awarding agency or pass-through entity. Management Directive 325.12, Amended, Standards for Enterprise Risk Management in Commonwealth Agencies, adopted the internal control framework outlined in the United States Government Accountability Office’s Standards for Internal Control in the Federal Government (Green Book). The Green Book states in part: Management should establish and operate monitoring activities to monitor the internal control system and evaluate the results. Management should remediate identified internal control deficiencies on a timely basis. Finding 2023 – 018: (continued) Cause: Office of Vocational Rehabilitation (OVR), Pennsylvania Department of Labor and Industry personnel did not check service dates prior to submitting invoices for payment which were charged to the federal fiscal year 2021 grant. OVR personnel did not have adequate procedures in place to ensure that only costs incurred during the allowable period of performance were charged to the grant. Effect: Expenditures outside of the allowable period of performance were incorrectly charged to the grant without authorization by the federal awarding agency, resulting in noncompliance and questioned costs. Recommendation: We recommend that OVR personnel implement procedures to ensure that costs and adjustments being charged to a federal grant are incurred within the allowable period of performance of the grant to which they are being charged, or when necessary, obtain authorization from the federal awarding agency prior to charging costs that are outside the allowable period of performance. Agency Response: OVR agrees with this finding. Questioned Costs: Known questioned costs of $8,763 were determined, which represents the amount of transactions incurred and charged to the federal grant outside the allowable period of performance.
Finding 2023-002: Period of Performance Information on the Federal Program: 93.368 Criteria: 2 CFR §200.309 non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in §200.461 Publication and printing costs) 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. Condition: In testing the Foundation's compliance with the period of performance availability for Federal awards, we noted one instance in which an invoice for an expense incurred outside of both the award's period of performance and the Foundation's fiscal year-end was recorded and charged to the Federal award. Cause: The Foundation's controls are not adequately designed to detect an expense recorded outside of the award's period of performance or outside of the Foundation's fiscal year-end. Effect: Costs that are not incurred and recorded within the period of performance may be determined and considered an unallowable charge against a Federally funded program. Questioned Costs: $55,000 Context: Our audit procedures consisted of testwork completed on individual expenditures charged to the Federal awards that ended within the 2023 fiscal year-end. The report in which samples were selected was generated directly from the Foundation's general ledger (accounting system). We consider our sample to be representative of the population. Identification as a Repeat Finding: Not a repeat finding. Recommendation: We recommend that all invoices be reviewed to ensure that expenses are appropriately recorded in the period for which they are incurred.
FINDING 2022-005 Subject: Special Education Cluster ? Period of Performance Federal Agency: Department of Education Federal Programs: Special Education_Grants to States, Special Education_Preschool Grants AL Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Period of Performance Audit Findings: Material Weakness Criteria: 2 CFR 200.303 states in part: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the `Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . .? 2 CFR 200.309 states: ?A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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 200.343(b) states: ?Unless the Federal awarding agency or pass-through entity authorizes an extension, a non-Federal entity must liquidate all obligations incurred under the Federal award not later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award.? Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the equipment requirements of the Period of Performance compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls that would have ensured that adequate records and documentation would be available to support compliance with the grant agreement and the period of performance requirements. Effect: The failure to establish an effective internal control system and failure to maintain and provide records and documentation of expenditures by grant award, program, and years prevented the determination of the School Corporation's compliance with the Period of Performance compliance requirement. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was a member of a joint service cooperative (Cooperative). The Cooperative operated the special education programs on behalf of the School Corporation and managed the special education grant funds. Because the grant agreements were between the Indiana Department of Education and the School Corporation, the School Corporation was ultimately responsible for compliance with the grant agreement and the Period of Performance compliance requirement. During fiscal year 2021, the School Corporation paid membership fees to the Cooperative out of federal Special Education funds. These membership fees made up approximately 48% of the total federal expenditures reimbursed during fiscal year 2021. The Cooperative accounted for state, local, and federal funds in a single fund. The fund did not separately account for each of the funding sources. This made it difficult to identify which expenditures were from federal funds, or to identify expenditures by federal program, award number, or years. Therefore, we could not test compliance with the period of performance requirements for approximately 48% of the expenditures. The School Corporation did not have adequate procedures in place to ensure that the Cooperative complied with the period of performance requirements. The Cooperative did not have adequate procedures in place to ensure that costs were charged to the programs only during the period of performance, or that all obligations were liquidated within 90 days of the end of the period of performance. The lack of internal controls and noncompliance were systemic issues, which occurred specifically during fiscal year 2021. No reportable findings were noted for fiscal year 2022. Identification as a repeat finding, if applicable: Yes, see Finding 2020-004. Recommendation: It was recommended that the School Corporation?s management establish internal controls to ensure that records and documentation will be maintained and made available for audit related to the Period of Performance compliance requirements. As recommended, management implemented internal control procedures for the year ended June 30, 2022. Views of Responsible Officials: Management agrees with the finding and has implemented their corrective action plan.
FINDING 2022-005 Subject: Special Education Cluster ? Period of Performance Federal Agency: Department of Education Federal Programs: Special Education_Grants to States, Special Education_Preschool Grants AL Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Period of Performance Audit Findings: Material Weakness Criteria: 2 CFR 200.303 states in part: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the `Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . .? 2 CFR 200.309 states: ?A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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 200.343(b) states: ?Unless the Federal awarding agency or pass-through entity authorizes an extension, a non-Federal entity must liquidate all obligations incurred under the Federal award not later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award.? Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the equipment requirements of the Period of Performance compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls that would have ensured that adequate records and documentation would be available to support compliance with the grant agreement and the period of performance requirements. Effect: The failure to establish an effective internal control system and failure to maintain and provide records and documentation of expenditures by grant award, program, and years prevented the determination of the School Corporation's compliance with the Period of Performance compliance requirement. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was a member of a joint service cooperative (Cooperative). The Cooperative operated the special education programs on behalf of the School Corporation and managed the special education grant funds. Because the grant agreements were between the Indiana Department of Education and the School Corporation, the School Corporation was ultimately responsible for compliance with the grant agreement and the Period of Performance compliance requirement. During fiscal year 2021, the School Corporation paid membership fees to the Cooperative out of federal Special Education funds. These membership fees made up approximately 48% of the total federal expenditures reimbursed during fiscal year 2021. The Cooperative accounted for state, local, and federal funds in a single fund. The fund did not separately account for each of the funding sources. This made it difficult to identify which expenditures were from federal funds, or to identify expenditures by federal program, award number, or years. Therefore, we could not test compliance with the period of performance requirements for approximately 48% of the expenditures. The School Corporation did not have adequate procedures in place to ensure that the Cooperative complied with the period of performance requirements. The Cooperative did not have adequate procedures in place to ensure that costs were charged to the programs only during the period of performance, or that all obligations were liquidated within 90 days of the end of the period of performance. The lack of internal controls and noncompliance were systemic issues, which occurred specifically during fiscal year 2021. No reportable findings were noted for fiscal year 2022. Identification as a repeat finding, if applicable: Yes, see Finding 2020-004. Recommendation: It was recommended that the School Corporation?s management establish internal controls to ensure that records and documentation will be maintained and made available for audit related to the Period of Performance compliance requirements. As recommended, management implemented internal control procedures for the year ended June 30, 2022. Views of Responsible Officials: Management agrees with the finding and has implemented their corrective action plan.
FINDING 2022-005 Subject: Special Education Cluster ? Period of Performance Federal Agency: Department of Education Federal Programs: Special Education_Grants to States, Special Education_Preschool Grants AL Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Period of Performance Audit Findings: Material Weakness Criteria: 2 CFR 200.303 states in part: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the `Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . .? 2 CFR 200.309 states: ?A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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 200.343(b) states: ?Unless the Federal awarding agency or pass-through entity authorizes an extension, a non-Federal entity must liquidate all obligations incurred under the Federal award not later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award.? Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the equipment requirements of the Period of Performance compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls that would have ensured that adequate records and documentation would be available to support compliance with the grant agreement and the period of performance requirements. Effect: The failure to establish an effective internal control system and failure to maintain and provide records and documentation of expenditures by grant award, program, and years prevented the determination of the School Corporation's compliance with the Period of Performance compliance requirement. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was a member of a joint service cooperative (Cooperative). The Cooperative operated the special education programs on behalf of the School Corporation and managed the special education grant funds. Because the grant agreements were between the Indiana Department of Education and the School Corporation, the School Corporation was ultimately responsible for compliance with the grant agreement and the Period of Performance compliance requirement. During fiscal year 2021, the School Corporation paid membership fees to the Cooperative out of federal Special Education funds. These membership fees made up approximately 48% of the total federal expenditures reimbursed during fiscal year 2021. The Cooperative accounted for state, local, and federal funds in a single fund. The fund did not separately account for each of the funding sources. This made it difficult to identify which expenditures were from federal funds, or to identify expenditures by federal program, award number, or years. Therefore, we could not test compliance with the period of performance requirements for approximately 48% of the expenditures. The School Corporation did not have adequate procedures in place to ensure that the Cooperative complied with the period of performance requirements. The Cooperative did not have adequate procedures in place to ensure that costs were charged to the programs only during the period of performance, or that all obligations were liquidated within 90 days of the end of the period of performance. The lack of internal controls and noncompliance were systemic issues, which occurred specifically during fiscal year 2021. No reportable findings were noted for fiscal year 2022. Identification as a repeat finding, if applicable: Yes, see Finding 2020-004. Recommendation: It was recommended that the School Corporation?s management establish internal controls to ensure that records and documentation will be maintained and made available for audit related to the Period of Performance compliance requirements. As recommended, management implemented internal control procedures for the year ended June 30, 2022. Views of Responsible Officials: Management agrees with the finding and has implemented their corrective action plan.
FINDING 2022-005 Subject: Special Education Cluster ? Period of Performance Federal Agency: Department of Education Federal Programs: Special Education_Grants to States, Special Education_Preschool Grants AL Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Period of Performance Audit Findings: Material Weakness Criteria: 2 CFR 200.303 states in part: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the `Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . .? 2 CFR 200.309 states: ?A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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 200.343(b) states: ?Unless the Federal awarding agency or pass-through entity authorizes an extension, a non-Federal entity must liquidate all obligations incurred under the Federal award not later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award.? Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the equipment requirements of the Period of Performance compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls that would have ensured that adequate records and documentation would be available to support compliance with the grant agreement and the period of performance requirements. Effect: The failure to establish an effective internal control system and failure to maintain and provide records and documentation of expenditures by grant award, program, and years prevented the determination of the School Corporation's compliance with the Period of Performance compliance requirement. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was a member of a joint service cooperative (Cooperative). The Cooperative operated the special education programs on behalf of the School Corporation and managed the special education grant funds. Because the grant agreements were between the Indiana Department of Education and the School Corporation, the School Corporation was ultimately responsible for compliance with the grant agreement and the Period of Performance compliance requirement. During fiscal year 2021, the School Corporation paid membership fees to the Cooperative out of federal Special Education funds. These membership fees made up approximately 48% of the total federal expenditures reimbursed during fiscal year 2021. The Cooperative accounted for state, local, and federal funds in a single fund. The fund did not separately account for each of the funding sources. This made it difficult to identify which expenditures were from federal funds, or to identify expenditures by federal program, award number, or years. Therefore, we could not test compliance with the period of performance requirements for approximately 48% of the expenditures. The School Corporation did not have adequate procedures in place to ensure that the Cooperative complied with the period of performance requirements. The Cooperative did not have adequate procedures in place to ensure that costs were charged to the programs only during the period of performance, or that all obligations were liquidated within 90 days of the end of the period of performance. The lack of internal controls and noncompliance were systemic issues, which occurred specifically during fiscal year 2021. No reportable findings were noted for fiscal year 2022. Identification as a repeat finding, if applicable: Yes, see Finding 2020-004. Recommendation: It was recommended that the School Corporation?s management establish internal controls to ensure that records and documentation will be maintained and made available for audit related to the Period of Performance compliance requirements. As recommended, management implemented internal control procedures for the year ended June 30, 2022. Views of Responsible Officials: Management agrees with the finding and has implemented their corrective action plan.
FINDING 2022-005 Subject: Special Education Cluster ? Period of Performance Federal Agency: Department of Education Federal Programs: Special Education_Grants to States, Special Education_Preschool Grants AL Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Period of Performance Audit Findings: Material Weakness Criteria: 2 CFR 200.303 states in part: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the `Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . .? 2 CFR 200.309 states: ?A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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 200.343(b) states: ?Unless the Federal awarding agency or pass-through entity authorizes an extension, a non-Federal entity must liquidate all obligations incurred under the Federal award not later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award.? Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the equipment requirements of the Period of Performance compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls that would have ensured that adequate records and documentation would be available to support compliance with the grant agreement and the period of performance requirements. Effect: The failure to establish an effective internal control system and failure to maintain and provide records and documentation of expenditures by grant award, program, and years prevented the determination of the School Corporation's compliance with the Period of Performance compliance requirement. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was a member of a joint service cooperative (Cooperative). The Cooperative operated the special education programs on behalf of the School Corporation and managed the special education grant funds. Because the grant agreements were between the Indiana Department of Education and the School Corporation, the School Corporation was ultimately responsible for compliance with the grant agreement and the Period of Performance compliance requirement. During fiscal year 2021, the School Corporation paid membership fees to the Cooperative out of federal Special Education funds. These membership fees made up approximately 48% of the total federal expenditures reimbursed during fiscal year 2021. The Cooperative accounted for state, local, and federal funds in a single fund. The fund did not separately account for each of the funding sources. This made it difficult to identify which expenditures were from federal funds, or to identify expenditures by federal program, award number, or years. Therefore, we could not test compliance with the period of performance requirements for approximately 48% of the expenditures. The School Corporation did not have adequate procedures in place to ensure that the Cooperative complied with the period of performance requirements. The Cooperative did not have adequate procedures in place to ensure that costs were charged to the programs only during the period of performance, or that all obligations were liquidated within 90 days of the end of the period of performance. The lack of internal controls and noncompliance were systemic issues, which occurred specifically during fiscal year 2021. No reportable findings were noted for fiscal year 2022. Identification as a repeat finding, if applicable: Yes, see Finding 2020-004. Recommendation: It was recommended that the School Corporation?s management establish internal controls to ensure that records and documentation will be maintained and made available for audit related to the Period of Performance compliance requirements. As recommended, management implemented internal control procedures for the year ended June 30, 2022. Views of Responsible Officials: Management agrees with the finding and has implemented their corrective action plan.
FINDING 2022-005 Subject: Special Education Cluster ? Period of Performance Federal Agency: Department of Education Federal Programs: Special Education_Grants to States, Special Education_Preschool Grants AL Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Period of Performance Audit Findings: Material Weakness Criteria: 2 CFR 200.303 states in part: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the `Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . .? 2 CFR 200.309 states: ?A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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 200.343(b) states: ?Unless the Federal awarding agency or pass-through entity authorizes an extension, a non-Federal entity must liquidate all obligations incurred under the Federal award not later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award.? Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the equipment requirements of the Period of Performance compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls that would have ensured that adequate records and documentation would be available to support compliance with the grant agreement and the period of performance requirements. Effect: The failure to establish an effective internal control system and failure to maintain and provide records and documentation of expenditures by grant award, program, and years prevented the determination of the School Corporation's compliance with the Period of Performance compliance requirement. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was a member of a joint service cooperative (Cooperative). The Cooperative operated the special education programs on behalf of the School Corporation and managed the special education grant funds. Because the grant agreements were between the Indiana Department of Education and the School Corporation, the School Corporation was ultimately responsible for compliance with the grant agreement and the Period of Performance compliance requirement. During fiscal year 2021, the School Corporation paid membership fees to the Cooperative out of federal Special Education funds. These membership fees made up approximately 48% of the total federal expenditures reimbursed during fiscal year 2021. The Cooperative accounted for state, local, and federal funds in a single fund. The fund did not separately account for each of the funding sources. This made it difficult to identify which expenditures were from federal funds, or to identify expenditures by federal program, award number, or years. Therefore, we could not test compliance with the period of performance requirements for approximately 48% of the expenditures. The School Corporation did not have adequate procedures in place to ensure that the Cooperative complied with the period of performance requirements. The Cooperative did not have adequate procedures in place to ensure that costs were charged to the programs only during the period of performance, or that all obligations were liquidated within 90 days of the end of the period of performance. The lack of internal controls and noncompliance were systemic issues, which occurred specifically during fiscal year 2021. No reportable findings were noted for fiscal year 2022. Identification as a repeat finding, if applicable: Yes, see Finding 2020-004. Recommendation: It was recommended that the School Corporation?s management establish internal controls to ensure that records and documentation will be maintained and made available for audit related to the Period of Performance compliance requirements. As recommended, management implemented internal control procedures for the year ended June 30, 2022. Views of Responsible Officials: Management agrees with the finding and has implemented their corrective action plan.
FINDING 2022-005 Subject: Special Education Cluster ? Period of Performance Federal Agency: Department of Education Federal Programs: Special Education_Grants to States, Special Education_Preschool Grants AL Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Period of Performance Audit Findings: Material Weakness Criteria: 2 CFR 200.303 states in part: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the `Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . .? 2 CFR 200.309 states: ?A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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 200.343(b) states: ?Unless the Federal awarding agency or pass-through entity authorizes an extension, a non-Federal entity must liquidate all obligations incurred under the Federal award not later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award.? Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the equipment requirements of the Period of Performance compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls that would have ensured that adequate records and documentation would be available to support compliance with the grant agreement and the period of performance requirements. Effect: The failure to establish an effective internal control system and failure to maintain and provide records and documentation of expenditures by grant award, program, and years prevented the determination of the School Corporation's compliance with the Period of Performance compliance requirement. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was a member of a joint service cooperative (Cooperative). The Cooperative operated the special education programs on behalf of the School Corporation and managed the special education grant funds. Because the grant agreements were between the Indiana Department of Education and the School Corporation, the School Corporation was ultimately responsible for compliance with the grant agreement and the Period of Performance compliance requirement. During fiscal year 2021, the School Corporation paid membership fees to the Cooperative out of federal Special Education funds. These membership fees made up approximately 48% of the total federal expenditures reimbursed during fiscal year 2021. The Cooperative accounted for state, local, and federal funds in a single fund. The fund did not separately account for each of the funding sources. This made it difficult to identify which expenditures were from federal funds, or to identify expenditures by federal program, award number, or years. Therefore, we could not test compliance with the period of performance requirements for approximately 48% of the expenditures. The School Corporation did not have adequate procedures in place to ensure that the Cooperative complied with the period of performance requirements. The Cooperative did not have adequate procedures in place to ensure that costs were charged to the programs only during the period of performance, or that all obligations were liquidated within 90 days of the end of the period of performance. The lack of internal controls and noncompliance were systemic issues, which occurred specifically during fiscal year 2021. No reportable findings were noted for fiscal year 2022. Identification as a repeat finding, if applicable: Yes, see Finding 2020-004. Recommendation: It was recommended that the School Corporation?s management establish internal controls to ensure that records and documentation will be maintained and made available for audit related to the Period of Performance compliance requirements. As recommended, management implemented internal control procedures for the year ended June 30, 2022. Views of Responsible Officials: Management agrees with the finding and has implemented their corrective action plan.
FINDING 2022-010 Subject: Title I Grants to Local Educational Agencies - Activities Allowed or Unallowed, Allowable Costs/Cost Principles Federal Agency: Department of Education Federal Program: Title I Grants to Local Educational Agencies Assistance Listings Number: 84.010 Federal Award Numbers and Years (or Other Identifying Numbers): S010A190014, S010A200014, S010A190014SIG Pass-Through Entity: Indiana Department of Education Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls to ensure that proper documentation was retained for audit. A sample of forty transactions charged to the Title I grants during the audit period was selected for testing. The following errors were noted: 1. The School Corporation was unable to provide supporting documentation for three transactions, totaling $6,272. As such, these transactions were unable to be verified as allowable activities or costs for the Title I program. 2. Seven transactions, totaling $887, were for fringe benefit claims; however, the supporting documentation provided did not include details to identify the employees for which the benefits were paid. As a result, we were unable to determine if the payments were on behalf of allowable staff related to the Title I program. 3. Four transactions selected were for a Title I employee's payroll who did not have an approved hourly rate. The total amount of the four transactions paid to that employee was $4,261. 4. For two transactions tested, the payroll check register reported the employee was paid for more hours than was reported on their approved timecard. The additional amount paid to the employee was $1,374. Due to the number and magnitude of exceptions identified, per auditor judgment, we concluded it would not be appropriate to examine the remaining twenty-four transactions. The errors noted above were considered questioned costs. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal controls over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.334 states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass through entity in the case of a subrecipient. . . ." 2 CFR 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items . . . (g) Be adequately documented. . . ." 2 CFR 200.430(i) states in part: "Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities (for IHE, this per the IHE's definition of IBS); . . . (vii) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. . . ." 2 CFR 200.309 states: "A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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." Cause Management had not established an effective system of internal controls that would have ensured compliance, or that supporting documentation would have been maintained and made available for audit, with the grant agreement and the Activities Allowed or Unallowed and the Allowable Costs/Cost Principles compliance requirements. Effect The failure to establish an effective system of internal controls and to retain and provide appropriate supporting documentation prevented the determination of the School Corporation's compliance with the compliance requirements listed above. Questioned Costs Known questioned costs of $12,794 were identified, as detailed in Condition and Context. Recommendation We recommended that the School Corporation's management establish an effective system of internal controls to ensure documentation be maintained and made available for audit related to the grant agreement and the Activities Allowed or Unallowed and the Allowable Costs/Cost Principles compliance requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-010 Subject: Title I Grants to Local Educational Agencies - Activities Allowed or Unallowed, Allowable Costs/Cost Principles Federal Agency: Department of Education Federal Program: Title I Grants to Local Educational Agencies Assistance Listings Number: 84.010 Federal Award Numbers and Years (or Other Identifying Numbers): S010A190014, S010A200014, S010A190014SIG Pass-Through Entity: Indiana Department of Education Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls to ensure that proper documentation was retained for audit. A sample of forty transactions charged to the Title I grants during the audit period was selected for testing. The following errors were noted: 1. The School Corporation was unable to provide supporting documentation for three transactions, totaling $6,272. As such, these transactions were unable to be verified as allowable activities or costs for the Title I program. 2. Seven transactions, totaling $887, were for fringe benefit claims; however, the supporting documentation provided did not include details to identify the employees for which the benefits were paid. As a result, we were unable to determine if the payments were on behalf of allowable staff related to the Title I program. 3. Four transactions selected were for a Title I employee's payroll who did not have an approved hourly rate. The total amount of the four transactions paid to that employee was $4,261. 4. For two transactions tested, the payroll check register reported the employee was paid for more hours than was reported on their approved timecard. The additional amount paid to the employee was $1,374. Due to the number and magnitude of exceptions identified, per auditor judgment, we concluded it would not be appropriate to examine the remaining twenty-four transactions. The errors noted above were considered questioned costs. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal controls over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.334 states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass through entity in the case of a subrecipient. . . ." 2 CFR 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items . . . (g) Be adequately documented. . . ." 2 CFR 200.430(i) states in part: "Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities (for IHE, this per the IHE's definition of IBS); . . . (vii) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. . . ." 2 CFR 200.309 states: "A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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." Cause Management had not established an effective system of internal controls that would have ensured compliance, or that supporting documentation would have been maintained and made available for audit, with the grant agreement and the Activities Allowed or Unallowed and the Allowable Costs/Cost Principles compliance requirements. Effect The failure to establish an effective system of internal controls and to retain and provide appropriate supporting documentation prevented the determination of the School Corporation's compliance with the compliance requirements listed above. Questioned Costs Known questioned costs of $12,794 were identified, as detailed in Condition and Context. Recommendation We recommended that the School Corporation's management establish an effective system of internal controls to ensure documentation be maintained and made available for audit related to the grant agreement and the Activities Allowed or Unallowed and the Allowable Costs/Cost Principles compliance requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-010 Subject: Special Education Cluster (IDEA) - Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Period of Performance Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-138-PN01, 21619-138-PN01, 22611-138-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Period of Performance Audit Findings: Material Weakness, Modified Opinion Condition and Context An effective internal control system was not designed nor implemented at the School Corporation to ensure compliance with requirements related to the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. The School Corporation had not established an effective system of internal controls to ensure that proper documentation was retained for audit. The School Corporation was unable to provide supporting documentation for one of the two journal entries tested. For the one journal entry, we were unable to determine if the Special Education fund transfers in, totaling $619,180, and transfers out, totaling $554,684, were for allowable activities and costs for the program. In addition, we were unable to determine if the transfers were for transactions that occurred within the period of performance. The lack of internal controls and the failure to retain supporting documentation was isolated to the transfers noted above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal controls over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 40 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.333 (Uniform Guidance) states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass through entity in the case of a subrecipient. . . ." 2 CFR 200.334 (Revised Uniform Guidance) states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 34 CFR 300.202(a) states: "General. Amounts provided to the LEA under Part B of the Act - (1) Must be expended in accordance with the applicable provisions of this part; (2) Must be used only to pay the excess costs of providing special education and related services to children with disabilities, consistent with paragraph (b) of this section; and (3) Must be used to supplement State, local, and other Federal funds and not to supplant those funds." 34 CFR 300.208 states: "(a) Uses. Notwithstanding ?? 300.202, 300.203(b), and 300.162(b), funds provided to an LEA under Part B of the Act may be used for the following activities: (1) Services and aids that also benefit nondisabled children. For the costs of special education and related services, and supplementary aids and services, provided in a regular class or other education-related setting to a child with a disability in accordance with the IEP of the child, even if one or more nondisabled children benefit from these services. (2) Early intervening services. To develop and implement coordinated, early intervening educational services in accordance with ? 300.226. (3) High cost special education and related services. To establish and implement cost or risk sharing funds, consortia, or cooperatives for the LEA itself, or for LEAs working in a consortium of which the LEA is a part, to pay for high cost special education and related services. (b) Administrative case management. An LEA may use funds received under Part B of the Act to purchase appropriate technology for recordkeeping, data collection, and related case management activities of teachers and related services personnel providing services described in the IEP of children with disabilities, that is needed for the implementation of those case management activities." INDIANA STATE BOARD OF ACCOUNTS 41 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 34 CFR 300.800 states: "The Secretary provides grants under section 619 of the Act to assist States to provide special education and related services in accordance with Part B of the Act ? (a) To children with disabilities aged three through five years; and (b) At a State's discretion, to two-year-old children with disabilities who will turn three during the school year." 2 CFR 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. . . (g) Be adequately documented. . . ." 2 CFR 200.77 (Uniform Guidance) states: "Period of performance means the time during which the non-Federal entity may incur new obligations to carry out the work authorized under the Federal award. The Federal awarding agency or pass-through entity must include start and end dates of the period of performance in the Federal award (see ?? 200.210 Information contained in a Federal award paragraph (a)(5) and 200.331 Requirements for pass-through entities, paragraph (a)(1)(iv))." 2 CFR 200.1 (Revised Uniform Guidance) states in part: ". . . Period of performance means the total estimated time interval between the start of an initial Federal award and the planned end date, which may include one or more funded portions, or budget periods. Identification of the period of performance in the Federal award per ? 200.211(b)(5) does not commit the awarding agency to fund the award beyond the currently approved budget period. . . ." 2 CFR 200.309 (Uniform Guidance) states: "A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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." 2CFR 200.309 (Revised Uniform Guidance) states: "If a Federal awarding agency or pass-through entity approves an extension, or if a recipient extends under ? 200.308(e)(2), the Period of Performance will be amended to end at the completion of the extension. If a termination occurs, the Period of Performance will be amended to end upon the effective date of termination. If a renewal award is issued, a distinct Period of Performance will begin." INDIANA STATE BOARD OF ACCOUNTS 42 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause Management had not developed nor implemented a system of internal controls that would have ensured compliance, or that supporting documentation would have been maintained and made available for audit, related to the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. Effect The failure to establish an effective system of internal controls and to retain and provide appropriate supporting documentation prevented the determination of the School Corporation's compliance with compliance requirements listed above. Questioned Costs Known questioned costs of $1,173,864 were identified, as detailed in Condition and Context. Recommendation We recommended that the School Corporation's management establish a system of internal controls to ensure documentation will be maintained and made available for audit and comply with the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-010 Subject: Special Education Cluster (IDEA) - Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Period of Performance Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-138-PN01, 21619-138-PN01, 22611-138-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Period of Performance Audit Findings: Material Weakness, Modified Opinion Condition and Context An effective internal control system was not designed nor implemented at the School Corporation to ensure compliance with requirements related to the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. The School Corporation had not established an effective system of internal controls to ensure that proper documentation was retained for audit. The School Corporation was unable to provide supporting documentation for one of the two journal entries tested. For the one journal entry, we were unable to determine if the Special Education fund transfers in, totaling $619,180, and transfers out, totaling $554,684, were for allowable activities and costs for the program. In addition, we were unable to determine if the transfers were for transactions that occurred within the period of performance. The lack of internal controls and the failure to retain supporting documentation was isolated to the transfers noted above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal controls over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 40 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.333 (Uniform Guidance) states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass through entity in the case of a subrecipient. . . ." 2 CFR 200.334 (Revised Uniform Guidance) states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 34 CFR 300.202(a) states: "General. Amounts provided to the LEA under Part B of the Act - (1) Must be expended in accordance with the applicable provisions of this part; (2) Must be used only to pay the excess costs of providing special education and related services to children with disabilities, consistent with paragraph (b) of this section; and (3) Must be used to supplement State, local, and other Federal funds and not to supplant those funds." 34 CFR 300.208 states: "(a) Uses. Notwithstanding ?? 300.202, 300.203(b), and 300.162(b), funds provided to an LEA under Part B of the Act may be used for the following activities: (1) Services and aids that also benefit nondisabled children. For the costs of special education and related services, and supplementary aids and services, provided in a regular class or other education-related setting to a child with a disability in accordance with the IEP of the child, even if one or more nondisabled children benefit from these services. (2) Early intervening services. To develop and implement coordinated, early intervening educational services in accordance with ? 300.226. (3) High cost special education and related services. To establish and implement cost or risk sharing funds, consortia, or cooperatives for the LEA itself, or for LEAs working in a consortium of which the LEA is a part, to pay for high cost special education and related services. (b) Administrative case management. An LEA may use funds received under Part B of the Act to purchase appropriate technology for recordkeeping, data collection, and related case management activities of teachers and related services personnel providing services described in the IEP of children with disabilities, that is needed for the implementation of those case management activities." INDIANA STATE BOARD OF ACCOUNTS 41 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 34 CFR 300.800 states: "The Secretary provides grants under section 619 of the Act to assist States to provide special education and related services in accordance with Part B of the Act ? (a) To children with disabilities aged three through five years; and (b) At a State's discretion, to two-year-old children with disabilities who will turn three during the school year." 2 CFR 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. . . (g) Be adequately documented. . . ." 2 CFR 200.77 (Uniform Guidance) states: "Period of performance means the time during which the non-Federal entity may incur new obligations to carry out the work authorized under the Federal award. The Federal awarding agency or pass-through entity must include start and end dates of the period of performance in the Federal award (see ?? 200.210 Information contained in a Federal award paragraph (a)(5) and 200.331 Requirements for pass-through entities, paragraph (a)(1)(iv))." 2 CFR 200.1 (Revised Uniform Guidance) states in part: ". . . Period of performance means the total estimated time interval between the start of an initial Federal award and the planned end date, which may include one or more funded portions, or budget periods. Identification of the period of performance in the Federal award per ? 200.211(b)(5) does not commit the awarding agency to fund the award beyond the currently approved budget period. . . ." 2 CFR 200.309 (Uniform Guidance) states: "A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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." 2CFR 200.309 (Revised Uniform Guidance) states: "If a Federal awarding agency or pass-through entity approves an extension, or if a recipient extends under ? 200.308(e)(2), the Period of Performance will be amended to end at the completion of the extension. If a termination occurs, the Period of Performance will be amended to end upon the effective date of termination. If a renewal award is issued, a distinct Period of Performance will begin." INDIANA STATE BOARD OF ACCOUNTS 42 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause Management had not developed nor implemented a system of internal controls that would have ensured compliance, or that supporting documentation would have been maintained and made available for audit, related to the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. Effect The failure to establish an effective system of internal controls and to retain and provide appropriate supporting documentation prevented the determination of the School Corporation's compliance with compliance requirements listed above. Questioned Costs Known questioned costs of $1,173,864 were identified, as detailed in Condition and Context. Recommendation We recommended that the School Corporation's management establish a system of internal controls to ensure documentation will be maintained and made available for audit and comply with the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-010 Subject: Special Education Cluster (IDEA) - Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Period of Performance Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-138-PN01, 21619-138-PN01, 22611-138-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Period of Performance Audit Findings: Material Weakness, Modified Opinion Condition and Context An effective internal control system was not designed nor implemented at the School Corporation to ensure compliance with requirements related to the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. The School Corporation had not established an effective system of internal controls to ensure that proper documentation was retained for audit. The School Corporation was unable to provide supporting documentation for one of the two journal entries tested. For the one journal entry, we were unable to determine if the Special Education fund transfers in, totaling $619,180, and transfers out, totaling $554,684, were for allowable activities and costs for the program. In addition, we were unable to determine if the transfers were for transactions that occurred within the period of performance. The lack of internal controls and the failure to retain supporting documentation was isolated to the transfers noted above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal controls over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 40 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.333 (Uniform Guidance) states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass through entity in the case of a subrecipient. . . ." 2 CFR 200.334 (Revised Uniform Guidance) states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 34 CFR 300.202(a) states: "General. Amounts provided to the LEA under Part B of the Act - (1) Must be expended in accordance with the applicable provisions of this part; (2) Must be used only to pay the excess costs of providing special education and related services to children with disabilities, consistent with paragraph (b) of this section; and (3) Must be used to supplement State, local, and other Federal funds and not to supplant those funds." 34 CFR 300.208 states: "(a) Uses. Notwithstanding ?? 300.202, 300.203(b), and 300.162(b), funds provided to an LEA under Part B of the Act may be used for the following activities: (1) Services and aids that also benefit nondisabled children. For the costs of special education and related services, and supplementary aids and services, provided in a regular class or other education-related setting to a child with a disability in accordance with the IEP of the child, even if one or more nondisabled children benefit from these services. (2) Early intervening services. To develop and implement coordinated, early intervening educational services in accordance with ? 300.226. (3) High cost special education and related services. To establish and implement cost or risk sharing funds, consortia, or cooperatives for the LEA itself, or for LEAs working in a consortium of which the LEA is a part, to pay for high cost special education and related services. (b) Administrative case management. An LEA may use funds received under Part B of the Act to purchase appropriate technology for recordkeeping, data collection, and related case management activities of teachers and related services personnel providing services described in the IEP of children with disabilities, that is needed for the implementation of those case management activities." INDIANA STATE BOARD OF ACCOUNTS 41 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 34 CFR 300.800 states: "The Secretary provides grants under section 619 of the Act to assist States to provide special education and related services in accordance with Part B of the Act ? (a) To children with disabilities aged three through five years; and (b) At a State's discretion, to two-year-old children with disabilities who will turn three during the school year." 2 CFR 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. . . (g) Be adequately documented. . . ." 2 CFR 200.77 (Uniform Guidance) states: "Period of performance means the time during which the non-Federal entity may incur new obligations to carry out the work authorized under the Federal award. The Federal awarding agency or pass-through entity must include start and end dates of the period of performance in the Federal award (see ?? 200.210 Information contained in a Federal award paragraph (a)(5) and 200.331 Requirements for pass-through entities, paragraph (a)(1)(iv))." 2 CFR 200.1 (Revised Uniform Guidance) states in part: ". . . Period of performance means the total estimated time interval between the start of an initial Federal award and the planned end date, which may include one or more funded portions, or budget periods. Identification of the period of performance in the Federal award per ? 200.211(b)(5) does not commit the awarding agency to fund the award beyond the currently approved budget period. . . ." 2 CFR 200.309 (Uniform Guidance) states: "A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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." 2CFR 200.309 (Revised Uniform Guidance) states: "If a Federal awarding agency or pass-through entity approves an extension, or if a recipient extends under ? 200.308(e)(2), the Period of Performance will be amended to end at the completion of the extension. If a termination occurs, the Period of Performance will be amended to end upon the effective date of termination. If a renewal award is issued, a distinct Period of Performance will begin." INDIANA STATE BOARD OF ACCOUNTS 42 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause Management had not developed nor implemented a system of internal controls that would have ensured compliance, or that supporting documentation would have been maintained and made available for audit, related to the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. Effect The failure to establish an effective system of internal controls and to retain and provide appropriate supporting documentation prevented the determination of the School Corporation's compliance with compliance requirements listed above. Questioned Costs Known questioned costs of $1,173,864 were identified, as detailed in Condition and Context. Recommendation We recommended that the School Corporation's management establish a system of internal controls to ensure documentation will be maintained and made available for audit and comply with the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-005 Subject: Special Education Cluster ? Period of Performance Federal Agency: Department of Education Federal Programs: Special Education_Grants to States, Special Education_Preschool Grants AL Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Period of Performance Audit Findings: Material Weakness Criteria: 2 CFR 200.303 states in part: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the `Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . .? 2 CFR 200.309 states: ?A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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 200.343(b) states: ?Unless the Federal awarding agency or pass-through entity authorizes an extension, a non-Federal entity must liquidate all obligations incurred under the Federal award not later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award.? Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the equipment requirements of the Period of Performance compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls that would have ensured that adequate records and documentation would be available to support compliance with the grant agreement and the period of performance requirements. Effect: The failure to establish an effective internal control system and failure to maintain and provide records and documentation of expenditures by grant award, program, and years prevented the determination of the School Corporation's compliance with the Period of Performance compliance requirement. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was a member of a joint service cooperative (Cooperative). The Cooperative operated the special education programs on behalf of the School Corporation and managed the special education grant funds. Because the grant agreements were between the Indiana Department of Education and the School Corporation, the School Corporation was ultimately responsible for compliance with the grant agreement and the Period of Performance compliance requirement. During fiscal year 2021, the School Corporation paid membership fees to the Cooperative out of federal Special Education funds. These membership fees made up approximately 48% of the total federal expenditures reimbursed during fiscal year 2021. The Cooperative accounted for state, local, and federal funds in a single fund. The fund did not separately account for each of the funding sources. This made it difficult to identify which expenditures were from federal funds, or to identify expenditures by federal program, award number, or years. Therefore, we could not test compliance with the period of performance requirements for approximately 48% of the expenditures. The School Corporation did not have adequate procedures in place to ensure that the Cooperative complied with the period of performance requirements. The Cooperative did not have adequate procedures in place to ensure that costs were charged to the programs only during the period of performance, or that all obligations were liquidated within 90 days of the end of the period of performance. The lack of internal controls and noncompliance were systemic issues, which occurred specifically during fiscal year 2021. No reportable findings were noted for fiscal year 2022. Identification as a repeat finding, if applicable: Yes, see Finding 2020-004. Recommendation: It was recommended that the School Corporation?s management establish internal controls to ensure that records and documentation will be maintained and made available for audit related to the Period of Performance compliance requirements. As recommended, management implemented internal control procedures for the year ended June 30, 2022. Views of Responsible Officials: Management agrees with the finding and has implemented their corrective action plan.
FINDING 2022-005 Subject: Special Education Cluster ? Period of Performance Federal Agency: Department of Education Federal Programs: Special Education_Grants to States, Special Education_Preschool Grants AL Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Period of Performance Audit Findings: Material Weakness Criteria: 2 CFR 200.303 states in part: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the `Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . .? 2 CFR 200.309 states: ?A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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 200.343(b) states: ?Unless the Federal awarding agency or pass-through entity authorizes an extension, a non-Federal entity must liquidate all obligations incurred under the Federal award not later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award.? Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the equipment requirements of the Period of Performance compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls that would have ensured that adequate records and documentation would be available to support compliance with the grant agreement and the period of performance requirements. Effect: The failure to establish an effective internal control system and failure to maintain and provide records and documentation of expenditures by grant award, program, and years prevented the determination of the School Corporation's compliance with the Period of Performance compliance requirement. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was a member of a joint service cooperative (Cooperative). The Cooperative operated the special education programs on behalf of the School Corporation and managed the special education grant funds. Because the grant agreements were between the Indiana Department of Education and the School Corporation, the School Corporation was ultimately responsible for compliance with the grant agreement and the Period of Performance compliance requirement. During fiscal year 2021, the School Corporation paid membership fees to the Cooperative out of federal Special Education funds. These membership fees made up approximately 48% of the total federal expenditures reimbursed during fiscal year 2021. The Cooperative accounted for state, local, and federal funds in a single fund. The fund did not separately account for each of the funding sources. This made it difficult to identify which expenditures were from federal funds, or to identify expenditures by federal program, award number, or years. Therefore, we could not test compliance with the period of performance requirements for approximately 48% of the expenditures. The School Corporation did not have adequate procedures in place to ensure that the Cooperative complied with the period of performance requirements. The Cooperative did not have adequate procedures in place to ensure that costs were charged to the programs only during the period of performance, or that all obligations were liquidated within 90 days of the end of the period of performance. The lack of internal controls and noncompliance were systemic issues, which occurred specifically during fiscal year 2021. No reportable findings were noted for fiscal year 2022. Identification as a repeat finding, if applicable: Yes, see Finding 2020-004. Recommendation: It was recommended that the School Corporation?s management establish internal controls to ensure that records and documentation will be maintained and made available for audit related to the Period of Performance compliance requirements. As recommended, management implemented internal control procedures for the year ended June 30, 2022. Views of Responsible Officials: Management agrees with the finding and has implemented their corrective action plan.
FINDING 2022-005 Subject: Special Education Cluster ? Period of Performance Federal Agency: Department of Education Federal Programs: Special Education_Grants to States, Special Education_Preschool Grants AL Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Period of Performance Audit Findings: Material Weakness Criteria: 2 CFR 200.303 states in part: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the `Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . .? 2 CFR 200.309 states: ?A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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 200.343(b) states: ?Unless the Federal awarding agency or pass-through entity authorizes an extension, a non-Federal entity must liquidate all obligations incurred under the Federal award not later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award.? Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the equipment requirements of the Period of Performance compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls that would have ensured that adequate records and documentation would be available to support compliance with the grant agreement and the period of performance requirements. Effect: The failure to establish an effective internal control system and failure to maintain and provide records and documentation of expenditures by grant award, program, and years prevented the determination of the School Corporation's compliance with the Period of Performance compliance requirement. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was a member of a joint service cooperative (Cooperative). The Cooperative operated the special education programs on behalf of the School Corporation and managed the special education grant funds. Because the grant agreements were between the Indiana Department of Education and the School Corporation, the School Corporation was ultimately responsible for compliance with the grant agreement and the Period of Performance compliance requirement. During fiscal year 2021, the School Corporation paid membership fees to the Cooperative out of federal Special Education funds. These membership fees made up approximately 48% of the total federal expenditures reimbursed during fiscal year 2021. The Cooperative accounted for state, local, and federal funds in a single fund. The fund did not separately account for each of the funding sources. This made it difficult to identify which expenditures were from federal funds, or to identify expenditures by federal program, award number, or years. Therefore, we could not test compliance with the period of performance requirements for approximately 48% of the expenditures. The School Corporation did not have adequate procedures in place to ensure that the Cooperative complied with the period of performance requirements. The Cooperative did not have adequate procedures in place to ensure that costs were charged to the programs only during the period of performance, or that all obligations were liquidated within 90 days of the end of the period of performance. The lack of internal controls and noncompliance were systemic issues, which occurred specifically during fiscal year 2021. No reportable findings were noted for fiscal year 2022. Identification as a repeat finding, if applicable: Yes, see Finding 2020-004. Recommendation: It was recommended that the School Corporation?s management establish internal controls to ensure that records and documentation will be maintained and made available for audit related to the Period of Performance compliance requirements. As recommended, management implemented internal control procedures for the year ended June 30, 2022. Views of Responsible Officials: Management agrees with the finding and has implemented their corrective action plan.
FINDING 2022-005 Subject: Special Education Cluster ? Period of Performance Federal Agency: Department of Education Federal Programs: Special Education_Grants to States, Special Education_Preschool Grants AL Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Period of Performance Audit Findings: Material Weakness Criteria: 2 CFR 200.303 states in part: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the `Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . .? 2 CFR 200.309 states: ?A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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 200.343(b) states: ?Unless the Federal awarding agency or pass-through entity authorizes an extension, a non-Federal entity must liquidate all obligations incurred under the Federal award not later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award.? Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the equipment requirements of the Period of Performance compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls that would have ensured that adequate records and documentation would be available to support compliance with the grant agreement and the period of performance requirements. Effect: The failure to establish an effective internal control system and failure to maintain and provide records and documentation of expenditures by grant award, program, and years prevented the determination of the School Corporation's compliance with the Period of Performance compliance requirement. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was a member of a joint service cooperative (Cooperative). The Cooperative operated the special education programs on behalf of the School Corporation and managed the special education grant funds. Because the grant agreements were between the Indiana Department of Education and the School Corporation, the School Corporation was ultimately responsible for compliance with the grant agreement and the Period of Performance compliance requirement. During fiscal year 2021, the School Corporation paid membership fees to the Cooperative out of federal Special Education funds. These membership fees made up approximately 48% of the total federal expenditures reimbursed during fiscal year 2021. The Cooperative accounted for state, local, and federal funds in a single fund. The fund did not separately account for each of the funding sources. This made it difficult to identify which expenditures were from federal funds, or to identify expenditures by federal program, award number, or years. Therefore, we could not test compliance with the period of performance requirements for approximately 48% of the expenditures. The School Corporation did not have adequate procedures in place to ensure that the Cooperative complied with the period of performance requirements. The Cooperative did not have adequate procedures in place to ensure that costs were charged to the programs only during the period of performance, or that all obligations were liquidated within 90 days of the end of the period of performance. The lack of internal controls and noncompliance were systemic issues, which occurred specifically during fiscal year 2021. No reportable findings were noted for fiscal year 2022. Identification as a repeat finding, if applicable: Yes, see Finding 2020-004. Recommendation: It was recommended that the School Corporation?s management establish internal controls to ensure that records and documentation will be maintained and made available for audit related to the Period of Performance compliance requirements. As recommended, management implemented internal control procedures for the year ended June 30, 2022. Views of Responsible Officials: Management agrees with the finding and has implemented their corrective action plan.
FINDING 2022-005 Subject: Special Education Cluster ? Period of Performance Federal Agency: Department of Education Federal Programs: Special Education_Grants to States, Special Education_Preschool Grants AL Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Period of Performance Audit Findings: Material Weakness Criteria: 2 CFR 200.303 states in part: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the `Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . .? 2 CFR 200.309 states: ?A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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 200.343(b) states: ?Unless the Federal awarding agency or pass-through entity authorizes an extension, a non-Federal entity must liquidate all obligations incurred under the Federal award not later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award.? Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the equipment requirements of the Period of Performance compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls that would have ensured that adequate records and documentation would be available to support compliance with the grant agreement and the period of performance requirements. Effect: The failure to establish an effective internal control system and failure to maintain and provide records and documentation of expenditures by grant award, program, and years prevented the determination of the School Corporation's compliance with the Period of Performance compliance requirement. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was a member of a joint service cooperative (Cooperative). The Cooperative operated the special education programs on behalf of the School Corporation and managed the special education grant funds. Because the grant agreements were between the Indiana Department of Education and the School Corporation, the School Corporation was ultimately responsible for compliance with the grant agreement and the Period of Performance compliance requirement. During fiscal year 2021, the School Corporation paid membership fees to the Cooperative out of federal Special Education funds. These membership fees made up approximately 48% of the total federal expenditures reimbursed during fiscal year 2021. The Cooperative accounted for state, local, and federal funds in a single fund. The fund did not separately account for each of the funding sources. This made it difficult to identify which expenditures were from federal funds, or to identify expenditures by federal program, award number, or years. Therefore, we could not test compliance with the period of performance requirements for approximately 48% of the expenditures. The School Corporation did not have adequate procedures in place to ensure that the Cooperative complied with the period of performance requirements. The Cooperative did not have adequate procedures in place to ensure that costs were charged to the programs only during the period of performance, or that all obligations were liquidated within 90 days of the end of the period of performance. The lack of internal controls and noncompliance were systemic issues, which occurred specifically during fiscal year 2021. No reportable findings were noted for fiscal year 2022. Identification as a repeat finding, if applicable: Yes, see Finding 2020-004. Recommendation: It was recommended that the School Corporation?s management establish internal controls to ensure that records and documentation will be maintained and made available for audit related to the Period of Performance compliance requirements. As recommended, management implemented internal control procedures for the year ended June 30, 2022. Views of Responsible Officials: Management agrees with the finding and has implemented their corrective action plan.
FINDING 2022-005 Subject: Special Education Cluster ? Period of Performance Federal Agency: Department of Education Federal Programs: Special Education_Grants to States, Special Education_Preschool Grants AL Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Period of Performance Audit Findings: Material Weakness Criteria: 2 CFR 200.303 states in part: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the `Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . .? 2 CFR 200.309 states: ?A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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 200.343(b) states: ?Unless the Federal awarding agency or pass-through entity authorizes an extension, a non-Federal entity must liquidate all obligations incurred under the Federal award not later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award.? Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the equipment requirements of the Period of Performance compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls that would have ensured that adequate records and documentation would be available to support compliance with the grant agreement and the period of performance requirements. Effect: The failure to establish an effective internal control system and failure to maintain and provide records and documentation of expenditures by grant award, program, and years prevented the determination of the School Corporation's compliance with the Period of Performance compliance requirement. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was a member of a joint service cooperative (Cooperative). The Cooperative operated the special education programs on behalf of the School Corporation and managed the special education grant funds. Because the grant agreements were between the Indiana Department of Education and the School Corporation, the School Corporation was ultimately responsible for compliance with the grant agreement and the Period of Performance compliance requirement. During fiscal year 2021, the School Corporation paid membership fees to the Cooperative out of federal Special Education funds. These membership fees made up approximately 48% of the total federal expenditures reimbursed during fiscal year 2021. The Cooperative accounted for state, local, and federal funds in a single fund. The fund did not separately account for each of the funding sources. This made it difficult to identify which expenditures were from federal funds, or to identify expenditures by federal program, award number, or years. Therefore, we could not test compliance with the period of performance requirements for approximately 48% of the expenditures. The School Corporation did not have adequate procedures in place to ensure that the Cooperative complied with the period of performance requirements. The Cooperative did not have adequate procedures in place to ensure that costs were charged to the programs only during the period of performance, or that all obligations were liquidated within 90 days of the end of the period of performance. The lack of internal controls and noncompliance were systemic issues, which occurred specifically during fiscal year 2021. No reportable findings were noted for fiscal year 2022. Identification as a repeat finding, if applicable: Yes, see Finding 2020-004. Recommendation: It was recommended that the School Corporation?s management establish internal controls to ensure that records and documentation will be maintained and made available for audit related to the Period of Performance compliance requirements. As recommended, management implemented internal control procedures for the year ended June 30, 2022. Views of Responsible Officials: Management agrees with the finding and has implemented their corrective action plan.
FINDING 2022-005 Subject: Special Education Cluster ? Period of Performance Federal Agency: Department of Education Federal Programs: Special Education_Grants to States, Special Education_Preschool Grants AL Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): FY21, FY22 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Period of Performance Audit Findings: Material Weakness Criteria: 2 CFR 200.303 states in part: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in `Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the `Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . .? 2 CFR 200.309 states: ?A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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 200.343(b) states: ?Unless the Federal awarding agency or pass-through entity authorizes an extension, a non-Federal entity must liquidate all obligations incurred under the Federal award not later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award.? Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the equipment requirements of the Period of Performance compliance requirement. Cause: The School Corporation's management had not developed a system of internal controls that would have ensured that adequate records and documentation would be available to support compliance with the grant agreement and the period of performance requirements. Effect: The failure to establish an effective internal control system and failure to maintain and provide records and documentation of expenditures by grant award, program, and years prevented the determination of the School Corporation's compliance with the Period of Performance compliance requirement. Questioned Costs: There were no questioned costs identified. Context: The School Corporation was a member of a joint service cooperative (Cooperative). The Cooperative operated the special education programs on behalf of the School Corporation and managed the special education grant funds. Because the grant agreements were between the Indiana Department of Education and the School Corporation, the School Corporation was ultimately responsible for compliance with the grant agreement and the Period of Performance compliance requirement. During fiscal year 2021, the School Corporation paid membership fees to the Cooperative out of federal Special Education funds. These membership fees made up approximately 48% of the total federal expenditures reimbursed during fiscal year 2021. The Cooperative accounted for state, local, and federal funds in a single fund. The fund did not separately account for each of the funding sources. This made it difficult to identify which expenditures were from federal funds, or to identify expenditures by federal program, award number, or years. Therefore, we could not test compliance with the period of performance requirements for approximately 48% of the expenditures. The School Corporation did not have adequate procedures in place to ensure that the Cooperative complied with the period of performance requirements. The Cooperative did not have adequate procedures in place to ensure that costs were charged to the programs only during the period of performance, or that all obligations were liquidated within 90 days of the end of the period of performance. The lack of internal controls and noncompliance were systemic issues, which occurred specifically during fiscal year 2021. No reportable findings were noted for fiscal year 2022. Identification as a repeat finding, if applicable: Yes, see Finding 2020-004. Recommendation: It was recommended that the School Corporation?s management establish internal controls to ensure that records and documentation will be maintained and made available for audit related to the Period of Performance compliance requirements. As recommended, management implemented internal control procedures for the year ended June 30, 2022. Views of Responsible Officials: Management agrees with the finding and has implemented their corrective action plan.
FINDING 2022-010 Subject: Title I Grants to Local Educational Agencies - Activities Allowed or Unallowed, Allowable Costs/Cost Principles Federal Agency: Department of Education Federal Program: Title I Grants to Local Educational Agencies Assistance Listings Number: 84.010 Federal Award Numbers and Years (or Other Identifying Numbers): S010A190014, S010A200014, S010A190014SIG Pass-Through Entity: Indiana Department of Education Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls to ensure that proper documentation was retained for audit. A sample of forty transactions charged to the Title I grants during the audit period was selected for testing. The following errors were noted: 1. The School Corporation was unable to provide supporting documentation for three transactions, totaling $6,272. As such, these transactions were unable to be verified as allowable activities or costs for the Title I program. 2. Seven transactions, totaling $887, were for fringe benefit claims; however, the supporting documentation provided did not include details to identify the employees for which the benefits were paid. As a result, we were unable to determine if the payments were on behalf of allowable staff related to the Title I program. 3. Four transactions selected were for a Title I employee's payroll who did not have an approved hourly rate. The total amount of the four transactions paid to that employee was $4,261. 4. For two transactions tested, the payroll check register reported the employee was paid for more hours than was reported on their approved timecard. The additional amount paid to the employee was $1,374. Due to the number and magnitude of exceptions identified, per auditor judgment, we concluded it would not be appropriate to examine the remaining twenty-four transactions. The errors noted above were considered questioned costs. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal controls over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.334 states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass through entity in the case of a subrecipient. . . ." 2 CFR 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items . . . (g) Be adequately documented. . . ." 2 CFR 200.430(i) states in part: "Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities (for IHE, this per the IHE's definition of IBS); . . . (vii) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. . . ." 2 CFR 200.309 states: "A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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." Cause Management had not established an effective system of internal controls that would have ensured compliance, or that supporting documentation would have been maintained and made available for audit, with the grant agreement and the Activities Allowed or Unallowed and the Allowable Costs/Cost Principles compliance requirements. Effect The failure to establish an effective system of internal controls and to retain and provide appropriate supporting documentation prevented the determination of the School Corporation's compliance with the compliance requirements listed above. Questioned Costs Known questioned costs of $12,794 were identified, as detailed in Condition and Context. Recommendation We recommended that the School Corporation's management establish an effective system of internal controls to ensure documentation be maintained and made available for audit related to the grant agreement and the Activities Allowed or Unallowed and the Allowable Costs/Cost Principles compliance requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-010 Subject: Title I Grants to Local Educational Agencies - Activities Allowed or Unallowed, Allowable Costs/Cost Principles Federal Agency: Department of Education Federal Program: Title I Grants to Local Educational Agencies Assistance Listings Number: 84.010 Federal Award Numbers and Years (or Other Identifying Numbers): S010A190014, S010A200014, S010A190014SIG Pass-Through Entity: Indiana Department of Education Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls to ensure that proper documentation was retained for audit. A sample of forty transactions charged to the Title I grants during the audit period was selected for testing. The following errors were noted: 1. The School Corporation was unable to provide supporting documentation for three transactions, totaling $6,272. As such, these transactions were unable to be verified as allowable activities or costs for the Title I program. 2. Seven transactions, totaling $887, were for fringe benefit claims; however, the supporting documentation provided did not include details to identify the employees for which the benefits were paid. As a result, we were unable to determine if the payments were on behalf of allowable staff related to the Title I program. 3. Four transactions selected were for a Title I employee's payroll who did not have an approved hourly rate. The total amount of the four transactions paid to that employee was $4,261. 4. For two transactions tested, the payroll check register reported the employee was paid for more hours than was reported on their approved timecard. The additional amount paid to the employee was $1,374. Due to the number and magnitude of exceptions identified, per auditor judgment, we concluded it would not be appropriate to examine the remaining twenty-four transactions. The errors noted above were considered questioned costs. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal controls over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.334 states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass through entity in the case of a subrecipient. . . ." 2 CFR 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items . . . (g) Be adequately documented. . . ." 2 CFR 200.430(i) states in part: "Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities (for IHE, this per the IHE's definition of IBS); . . . (vii) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. . . ." 2 CFR 200.309 states: "A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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." Cause Management had not established an effective system of internal controls that would have ensured compliance, or that supporting documentation would have been maintained and made available for audit, with the grant agreement and the Activities Allowed or Unallowed and the Allowable Costs/Cost Principles compliance requirements. Effect The failure to establish an effective system of internal controls and to retain and provide appropriate supporting documentation prevented the determination of the School Corporation's compliance with the compliance requirements listed above. Questioned Costs Known questioned costs of $12,794 were identified, as detailed in Condition and Context. Recommendation We recommended that the School Corporation's management establish an effective system of internal controls to ensure documentation be maintained and made available for audit related to the grant agreement and the Activities Allowed or Unallowed and the Allowable Costs/Cost Principles compliance requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-010 Subject: Special Education Cluster (IDEA) - Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Period of Performance Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-138-PN01, 21619-138-PN01, 22611-138-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Period of Performance Audit Findings: Material Weakness, Modified Opinion Condition and Context An effective internal control system was not designed nor implemented at the School Corporation to ensure compliance with requirements related to the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. The School Corporation had not established an effective system of internal controls to ensure that proper documentation was retained for audit. The School Corporation was unable to provide supporting documentation for one of the two journal entries tested. For the one journal entry, we were unable to determine if the Special Education fund transfers in, totaling $619,180, and transfers out, totaling $554,684, were for allowable activities and costs for the program. In addition, we were unable to determine if the transfers were for transactions that occurred within the period of performance. The lack of internal controls and the failure to retain supporting documentation was isolated to the transfers noted above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal controls over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 40 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.333 (Uniform Guidance) states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass through entity in the case of a subrecipient. . . ." 2 CFR 200.334 (Revised Uniform Guidance) states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 34 CFR 300.202(a) states: "General. Amounts provided to the LEA under Part B of the Act - (1) Must be expended in accordance with the applicable provisions of this part; (2) Must be used only to pay the excess costs of providing special education and related services to children with disabilities, consistent with paragraph (b) of this section; and (3) Must be used to supplement State, local, and other Federal funds and not to supplant those funds." 34 CFR 300.208 states: "(a) Uses. Notwithstanding ?? 300.202, 300.203(b), and 300.162(b), funds provided to an LEA under Part B of the Act may be used for the following activities: (1) Services and aids that also benefit nondisabled children. For the costs of special education and related services, and supplementary aids and services, provided in a regular class or other education-related setting to a child with a disability in accordance with the IEP of the child, even if one or more nondisabled children benefit from these services. (2) Early intervening services. To develop and implement coordinated, early intervening educational services in accordance with ? 300.226. (3) High cost special education and related services. To establish and implement cost or risk sharing funds, consortia, or cooperatives for the LEA itself, or for LEAs working in a consortium of which the LEA is a part, to pay for high cost special education and related services. (b) Administrative case management. An LEA may use funds received under Part B of the Act to purchase appropriate technology for recordkeeping, data collection, and related case management activities of teachers and related services personnel providing services described in the IEP of children with disabilities, that is needed for the implementation of those case management activities." INDIANA STATE BOARD OF ACCOUNTS 41 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 34 CFR 300.800 states: "The Secretary provides grants under section 619 of the Act to assist States to provide special education and related services in accordance with Part B of the Act ? (a) To children with disabilities aged three through five years; and (b) At a State's discretion, to two-year-old children with disabilities who will turn three during the school year." 2 CFR 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. . . (g) Be adequately documented. . . ." 2 CFR 200.77 (Uniform Guidance) states: "Period of performance means the time during which the non-Federal entity may incur new obligations to carry out the work authorized under the Federal award. The Federal awarding agency or pass-through entity must include start and end dates of the period of performance in the Federal award (see ?? 200.210 Information contained in a Federal award paragraph (a)(5) and 200.331 Requirements for pass-through entities, paragraph (a)(1)(iv))." 2 CFR 200.1 (Revised Uniform Guidance) states in part: ". . . Period of performance means the total estimated time interval between the start of an initial Federal award and the planned end date, which may include one or more funded portions, or budget periods. Identification of the period of performance in the Federal award per ? 200.211(b)(5) does not commit the awarding agency to fund the award beyond the currently approved budget period. . . ." 2 CFR 200.309 (Uniform Guidance) states: "A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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." 2CFR 200.309 (Revised Uniform Guidance) states: "If a Federal awarding agency or pass-through entity approves an extension, or if a recipient extends under ? 200.308(e)(2), the Period of Performance will be amended to end at the completion of the extension. If a termination occurs, the Period of Performance will be amended to end upon the effective date of termination. If a renewal award is issued, a distinct Period of Performance will begin." INDIANA STATE BOARD OF ACCOUNTS 42 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause Management had not developed nor implemented a system of internal controls that would have ensured compliance, or that supporting documentation would have been maintained and made available for audit, related to the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. Effect The failure to establish an effective system of internal controls and to retain and provide appropriate supporting documentation prevented the determination of the School Corporation's compliance with compliance requirements listed above. Questioned Costs Known questioned costs of $1,173,864 were identified, as detailed in Condition and Context. Recommendation We recommended that the School Corporation's management establish a system of internal controls to ensure documentation will be maintained and made available for audit and comply with the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-010 Subject: Special Education Cluster (IDEA) - Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Period of Performance Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-138-PN01, 21619-138-PN01, 22611-138-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Period of Performance Audit Findings: Material Weakness, Modified Opinion Condition and Context An effective internal control system was not designed nor implemented at the School Corporation to ensure compliance with requirements related to the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. The School Corporation had not established an effective system of internal controls to ensure that proper documentation was retained for audit. The School Corporation was unable to provide supporting documentation for one of the two journal entries tested. For the one journal entry, we were unable to determine if the Special Education fund transfers in, totaling $619,180, and transfers out, totaling $554,684, were for allowable activities and costs for the program. In addition, we were unable to determine if the transfers were for transactions that occurred within the period of performance. The lack of internal controls and the failure to retain supporting documentation was isolated to the transfers noted above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal controls over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 40 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.333 (Uniform Guidance) states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass through entity in the case of a subrecipient. . . ." 2 CFR 200.334 (Revised Uniform Guidance) states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 34 CFR 300.202(a) states: "General. Amounts provided to the LEA under Part B of the Act - (1) Must be expended in accordance with the applicable provisions of this part; (2) Must be used only to pay the excess costs of providing special education and related services to children with disabilities, consistent with paragraph (b) of this section; and (3) Must be used to supplement State, local, and other Federal funds and not to supplant those funds." 34 CFR 300.208 states: "(a) Uses. Notwithstanding ?? 300.202, 300.203(b), and 300.162(b), funds provided to an LEA under Part B of the Act may be used for the following activities: (1) Services and aids that also benefit nondisabled children. For the costs of special education and related services, and supplementary aids and services, provided in a regular class or other education-related setting to a child with a disability in accordance with the IEP of the child, even if one or more nondisabled children benefit from these services. (2) Early intervening services. To develop and implement coordinated, early intervening educational services in accordance with ? 300.226. (3) High cost special education and related services. To establish and implement cost or risk sharing funds, consortia, or cooperatives for the LEA itself, or for LEAs working in a consortium of which the LEA is a part, to pay for high cost special education and related services. (b) Administrative case management. An LEA may use funds received under Part B of the Act to purchase appropriate technology for recordkeeping, data collection, and related case management activities of teachers and related services personnel providing services described in the IEP of children with disabilities, that is needed for the implementation of those case management activities." INDIANA STATE BOARD OF ACCOUNTS 41 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 34 CFR 300.800 states: "The Secretary provides grants under section 619 of the Act to assist States to provide special education and related services in accordance with Part B of the Act ? (a) To children with disabilities aged three through five years; and (b) At a State's discretion, to two-year-old children with disabilities who will turn three during the school year." 2 CFR 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. . . (g) Be adequately documented. . . ." 2 CFR 200.77 (Uniform Guidance) states: "Period of performance means the time during which the non-Federal entity may incur new obligations to carry out the work authorized under the Federal award. The Federal awarding agency or pass-through entity must include start and end dates of the period of performance in the Federal award (see ?? 200.210 Information contained in a Federal award paragraph (a)(5) and 200.331 Requirements for pass-through entities, paragraph (a)(1)(iv))." 2 CFR 200.1 (Revised Uniform Guidance) states in part: ". . . Period of performance means the total estimated time interval between the start of an initial Federal award and the planned end date, which may include one or more funded portions, or budget periods. Identification of the period of performance in the Federal award per ? 200.211(b)(5) does not commit the awarding agency to fund the award beyond the currently approved budget period. . . ." 2 CFR 200.309 (Uniform Guidance) states: "A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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." 2CFR 200.309 (Revised Uniform Guidance) states: "If a Federal awarding agency or pass-through entity approves an extension, or if a recipient extends under ? 200.308(e)(2), the Period of Performance will be amended to end at the completion of the extension. If a termination occurs, the Period of Performance will be amended to end upon the effective date of termination. If a renewal award is issued, a distinct Period of Performance will begin." INDIANA STATE BOARD OF ACCOUNTS 42 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause Management had not developed nor implemented a system of internal controls that would have ensured compliance, or that supporting documentation would have been maintained and made available for audit, related to the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. Effect The failure to establish an effective system of internal controls and to retain and provide appropriate supporting documentation prevented the determination of the School Corporation's compliance with compliance requirements listed above. Questioned Costs Known questioned costs of $1,173,864 were identified, as detailed in Condition and Context. Recommendation We recommended that the School Corporation's management establish a system of internal controls to ensure documentation will be maintained and made available for audit and comply with the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-010 Subject: Special Education Cluster (IDEA) - Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Period of Performance Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 21611-138-PN01, 21619-138-PN01, 22611-138-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Period of Performance Audit Findings: Material Weakness, Modified Opinion Condition and Context An effective internal control system was not designed nor implemented at the School Corporation to ensure compliance with requirements related to the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. The School Corporation had not established an effective system of internal controls to ensure that proper documentation was retained for audit. The School Corporation was unable to provide supporting documentation for one of the two journal entries tested. For the one journal entry, we were unable to determine if the Special Education fund transfers in, totaling $619,180, and transfers out, totaling $554,684, were for allowable activities and costs for the program. In addition, we were unable to determine if the transfers were for transactions that occurred within the period of performance. The lack of internal controls and the failure to retain supporting documentation was isolated to the transfers noted above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal controls over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 40 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.333 (Uniform Guidance) states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass through entity in the case of a subrecipient. . . ." 2 CFR 200.334 (Revised Uniform Guidance) states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 34 CFR 300.202(a) states: "General. Amounts provided to the LEA under Part B of the Act - (1) Must be expended in accordance with the applicable provisions of this part; (2) Must be used only to pay the excess costs of providing special education and related services to children with disabilities, consistent with paragraph (b) of this section; and (3) Must be used to supplement State, local, and other Federal funds and not to supplant those funds." 34 CFR 300.208 states: "(a) Uses. Notwithstanding ?? 300.202, 300.203(b), and 300.162(b), funds provided to an LEA under Part B of the Act may be used for the following activities: (1) Services and aids that also benefit nondisabled children. For the costs of special education and related services, and supplementary aids and services, provided in a regular class or other education-related setting to a child with a disability in accordance with the IEP of the child, even if one or more nondisabled children benefit from these services. (2) Early intervening services. To develop and implement coordinated, early intervening educational services in accordance with ? 300.226. (3) High cost special education and related services. To establish and implement cost or risk sharing funds, consortia, or cooperatives for the LEA itself, or for LEAs working in a consortium of which the LEA is a part, to pay for high cost special education and related services. (b) Administrative case management. An LEA may use funds received under Part B of the Act to purchase appropriate technology for recordkeeping, data collection, and related case management activities of teachers and related services personnel providing services described in the IEP of children with disabilities, that is needed for the implementation of those case management activities." INDIANA STATE BOARD OF ACCOUNTS 41 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 34 CFR 300.800 states: "The Secretary provides grants under section 619 of the Act to assist States to provide special education and related services in accordance with Part B of the Act ? (a) To children with disabilities aged three through five years; and (b) At a State's discretion, to two-year-old children with disabilities who will turn three during the school year." 2 CFR 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. . . (g) Be adequately documented. . . ." 2 CFR 200.77 (Uniform Guidance) states: "Period of performance means the time during which the non-Federal entity may incur new obligations to carry out the work authorized under the Federal award. The Federal awarding agency or pass-through entity must include start and end dates of the period of performance in the Federal award (see ?? 200.210 Information contained in a Federal award paragraph (a)(5) and 200.331 Requirements for pass-through entities, paragraph (a)(1)(iv))." 2 CFR 200.1 (Revised Uniform Guidance) states in part: ". . . Period of performance means the total estimated time interval between the start of an initial Federal award and the planned end date, which may include one or more funded portions, or budget periods. Identification of the period of performance in the Federal award per ? 200.211(b)(5) does not commit the awarding agency to fund the award beyond the currently approved budget period. . . ." 2 CFR 200.309 (Uniform Guidance) states: "A non-Federal entity may charge to the Federal award only allowable costs incurred during the period of performance (except as described in ? 200.461 Publication and printing costs) 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." 2CFR 200.309 (Revised Uniform Guidance) states: "If a Federal awarding agency or pass-through entity approves an extension, or if a recipient extends under ? 200.308(e)(2), the Period of Performance will be amended to end at the completion of the extension. If a termination occurs, the Period of Performance will be amended to end upon the effective date of termination. If a renewal award is issued, a distinct Period of Performance will begin." INDIANA STATE BOARD OF ACCOUNTS 42 SCOTT COUNTY SCHOOL DISTRICT 2 SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause Management had not developed nor implemented a system of internal controls that would have ensured compliance, or that supporting documentation would have been maintained and made available for audit, related to the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. Effect The failure to establish an effective system of internal controls and to retain and provide appropriate supporting documentation prevented the determination of the School Corporation's compliance with compliance requirements listed above. Questioned Costs Known questioned costs of $1,173,864 were identified, as detailed in Condition and Context. Recommendation We recommended that the School Corporation's management establish a system of internal controls to ensure documentation will be maintained and made available for audit and comply with the grant agreement and the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.