Criteria: As a condition of receiving federal awards, the awardee organization must comply with filing the required reports timely, specifically, submission of an audit report within nine months after the end of the audit period. Condition: The entity submitted their audit report eleven months after the end of their audit period September 30, 2023. Cause: The entity has not been able to close their books in a timely manner due to the late submission of vendor invoices. At times their closing has conflicted with the auditor’s availability and therefore, the audit was unable to be completed within the nine month period. Effect: The entity was not in compliance with the deadline for the audit report under 2 CFR 200.516 (a). Questioned costs: None Reported Context/Sampling: None Reported Repeat Finding from Prior Year: Yes 2023-001 Recommendation: We recommend that management communicate with their vendors to assure that timely invoices are submitted and that a strict timeline for completion of the audit is adhered to. Views of Responsible Officials: The entity has implemented wording in their vendor contracts that they will not honor invoices that are more than 90 days out.
Criteria: As a condition of receiving federal awards, the awardee organization must comply with filing the required reports timely, specifically, submission of an audit report within nine months after the end of the audit period. Condition: The entity submitted their audit report eleven months after the end of their audit period September 30, 2023. Cause: The entity has not been able to close their books in a timely manner due to the late submission of vendor invoices. At times their closing has conflicted with the auditor’s availability and therefore, the audit was unable to be completed within the nine month period. Effect: The entity was not in compliance with the deadline for the audit report under 2 CFR 200.516 (a). Questioned costs: None Reported Context/Sampling: None Reported Repeat Finding from Prior Year: Yes 2023-001 Recommendation: We recommend that management communicate with their vendors to assure that timely invoices are submitted and that a strict timeline for completion of the audit is adhered to. Views of Responsible Officials: The entity has implemented wording in their vendor contracts that they will not honor invoices that are more than 90 days out.
Criteria: As a condition of receiving federal awards, the awardee organization must comply with filing the required reports timely, specifically, submission of an audit report within nine months after the end of the audit period. Condition: The entity submitted their audit report eleven months after the end of their audit period September 30, 2023. Cause: The entity has not been able to close their books in a timely manner due to the late submission of vendor invoices. At times their closing has conflicted with the auditor’s availability and therefore, the audit was unable to be completed within the nine month period. Effect: The entity was not in compliance with the deadline for the audit report under 2 CFR 200.516 (a). Questioned costs: None Reported Context/Sampling: None Reported Repeat Finding from Prior Year: Yes 2023-001 Recommendation: We recommend that management communicate with their vendors to assure that timely invoices are submitted and that a strict timeline for completion of the audit is adhered to. Views of Responsible Officials: The entity has implemented wording in their vendor contracts that they will not honor invoices that are more than 90 days out.
Criteria: As a condition of receiving federal awards, the awardee organization must comply with filing the required reports timely, specifically, submission of an audit report within nine months after the end of the audit period. Condition: The entity submitted their audit report eleven months after the end of their audit period September 30, 2023. Cause: The entity has not been able to close their books in a timely manner due to the late submission of vendor invoices. At times their closing has conflicted with the auditor’s availability and therefore, the audit was unable to be completed within the nine month period. Effect: The entity was not in compliance with the deadline for the audit report under 2 CFR 200.516 (a). Questioned costs: None Reported Context/Sampling: None Reported Repeat Finding from Prior Year: Yes 2023-001 Recommendation: We recommend that management communicate with their vendors to assure that timely invoices are submitted and that a strict timeline for completion of the audit is adhered to. Views of Responsible Officials: The entity has implemented wording in their vendor contracts that they will not honor invoices that are more than 90 days out.
Criteria: As a condition of receiving federal awards, the awardee organization must comply with filing the required reports timely, specifically, submission of an audit report within nine months after the end of the audit period. Condition: The entity submitted their audit report eleven months after the end of their audit period September 30, 2023. Cause: The entity has not been able to close their books in a timely manner due to the late submission of vendor invoices. At times their closing has conflicted with the auditor’s availability and therefore, the audit was unable to be completed within the nine month period. Effect: The entity was not in compliance with the deadline for the audit report under 2 CFR 200.516 (a). Questioned costs: None Reported Context/Sampling: None Reported Repeat Finding from Prior Year: Yes 2023-001 Recommendation: We recommend that management communicate with their vendors to assure that timely invoices are submitted and that a strict timeline for completion of the audit is adhered to. Views of Responsible Officials: The entity has implemented wording in their vendor contracts that they will not honor invoices that are more than 90 days out.
Finding 2024-002: Overdrawn Federal Funding Compliance Requirements: Cash Management; Reporting Type: Material Weakness in Internal Control over Compliance and Material Noncompliance Federal Agency: Corporation for National and Community Service AL Numbers and Titles: 94.006 – AmeriCorps National Federal Award Number: 22NDHGA003 Questioned Costs: $748,053 Repeat Finding: No Criteria: Under 2 CFR § 200.305(b), federal funds must be drawn only as needed to meet the immediate cash requirements of the program. Recipients must minimize the time between the transfer of funds and disbursement. Per 2 CFR § 200.516(c), the auditor must report known questioned costs greater than $25,000 for a federal program, even if the program is not audited as a major program. Condition: As of September 30, 2024, NACDD has overdrawn a total of $748,053 in excess of expenditures to date in federal funds under the AmeriCorps grant. The overdrawn amount remained outstanding at year-end and had not been repaid or offset by additional allowable expenditures as of the date of this report. Cause: The overdrawn funds were caused by a failure in internal processes for reconciling drawdowns to actual expenditures. The drawdown analysis file used to request funds was corrupted, and no compensating control was in place to detect or prevent overdraws. Furthermore, NACDD did not implement timely corrective action after identifying the issue, and their internal control processes did not ensure compliance with federal cash management regulations. Additionally, Federal Financial Reports (FFRs) submitted by the organization did not accurately reflect actual allowable expenditures, and overstated cumulative grant activity. There was no timely reconciliation between the organization’s accounting records and amounts reported to the granting agency, as required. Effect: NACDD is in violation of federal cash management requirements, having drawn down $748,053 more in federal funds than expended as of year-end. This represents questioned costs and could result in a requirement to return funds to the granting agency. This issue exposes the organization to noncompliance risk and potential findings by federal oversight agencies. Additionally, incorrect reporting on the FFRs may have misled the grantor regarding the organization’s use of federal funds and the timing of expenditures. This constitutes a noncompliance with the Reporting requirement under 2 CFR 200.327–328, and calls into question the accuracy and completeness of required grantor submissions. Recommendation: We recommend that NACDD take immediate steps to address the overdrawn federal funds of $748,053 related to AmeriCorps grant by either remitting the excess to the granting agency or applying eligible FY25 expenditures, if allowable. To prevent recurrence, NACDD should implement formal monthly reconciliation procedures to ensure that all federal drawdowns are fully supported by actual expenditures recorded in the general ledger. Additionally, internal controls over financial reporting should be strengthened to ensure that amounts reported on the Federal Financial Reports (FFRs) and AmeriCorps’ eGrants system are accurate and agree to supporting records. Staff responsible for grant compliance should receive training on Uniform Guidance requirements, particularly those related to allowable costs, cash management, and reporting. Finally, NACDD should conduct a retrospective review of prior reports submitted to AmeriCorps for this project to assess whether corrections or disclosures are necessary and notify the grantor as appropriate. Views of Responsible Officials Corrective Actions: Management agrees with this finding. Please refer to the Corrective Action Plan.
Finding Number: 2024-002 Repeat Finding: Yes; 2023-002, 2022-002, 2021-002 Federal Program Name/Assistance Listing Title: Federal Transit Cluster Federal Assistance Listing Number: 20.507, 20.526 Federal Agency: U.S. Department of Transportation Federal Award Number: 5339-R-2022-GCTD-00039 Federal Pass-Through Agency: Texas Department of Transportation State Program Name: State Urbanized Area Formula Program, State Formula Grants For Rural Areas State Agency: Texas Department of Transportation Type of Finding: Noncompliance Material to Financial Statements and Federal/State Major Programs, Material Weakness in Internal Control Over Compliance Compliance Requirement: Procurement, Suspension and Debarment Questioned Costs: N/A; In accordance with 2 CFR 200.516(b)(7), when there are known questioned costs but the dollar amount is undetermined or not reported, the audit findings must include a description of why the dollar amount was undetermined or otherwise could not be reported. Based on our description of the finding below, the District was unable to provide evidence that the federal guidelines were followed for purchases exceeding the small purchases threshold. Due to inadequate records being maintained by the District, we were unable to determine if proper procured occurred for each purchase, and could not be located, or proper procurement never occurred. Therefore, we were unable to differentiate transactions as questioned costs from transactions in question caused solely because of deficiencies in internal control. Criteria Non-federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR §§200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable State and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR part 200. Additionally, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR §180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System of Award Management (SAM) maintained by the General Services Administration (GSA) or (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity (2 CFR §180.300). Condition The District did not meet the requirement to verify that covered transactions were only made to an entity that was not suspended or debarred or otherwise excluded. Additionally, the District did was unable to provide evidence that the federal guidelines for purchases exceeding the small purchases threshold. Cause The District’s internal controls over procurement of goods and services were not adequate. Effect The District was not in compliance with Federal regulations and guidelines related to suspension and debarment or procurement. Context The sample was not intended to be, and was not, a statistically valid sample. During our review of purchasing, we noted the following: For 4 out of 5 procurements reviewed, documentation demonstrating a vendor check for suspension and debarment was not retained. For 2 out of 5 vendors reviewed with total expenditures below the Simplified Acquisition threshold, no documentation of quotes was maintained. For 1 out of 1 vendors reviewed with total expenditures that exceeded the Simplified Acquisition threshold, no documentation of a sealed procurement issued in accordance with federal guidelines was maintained. Recommendation The District should maintain documentation of procurement actions in the vendor file including sealed procurements issued, quotes and suspension and debarment checks. Review of procurement compliance should occur before the District’s funds are obligated. Views of Responsible Officials The District agrees with the finding and has taken steps to address this issue as detailed in the Corrective Action Plan.
Finding 2024-043 - Use of Federal Funds to Satisfy Required Local Match Without Prior Approval Summary: The City of Batesville substituted federal Delta Regional Authority (ORA) and Appalachian Regional Commission (ARC) funds for required local match obligations under two federal grants-ARC (ALN 23.002) and CDBG (ALN 14.228)-without obtaining prior written approval from the awarding agencies. Although CDBG was not selected for audit testing, the questioned costs originally exceeded the $10,000 threshold and are reported in accordance with 2 CFR §200.516(a): Total questioned costs of $800,406 were initially allocated proportionally between the two programs; These costs have since been resolved through formal amendments to both grant agreements. Federal Programs 23.002 _; Appalachian Area Development (ARC) 14.228 - Community Development Block Grants/State's Program and Non-Entitlement Grants in Hawaii· (CDBG) Note: ALN 14.228 was not selected for audit testing under the Uniform Guidance compliance requirements. However, a finding is presented in accordance with 2 CFR §200.516(a) due to the materiality of the issue and its connection to ARC grant MS-20699. Award Numbers ARC: MS-20699 CDBG Subgrant: 1137 ~21-111-PF-01 Federal Agencies U.S. Department of the Treasury (via Appalachian Regional Commission) U.S. Department of Housing and Urban Development Compliance Requirements Matching - 2 CFR §200.306 Allowable Costs/Cost Principles - 2 CFR §200.403 Internal Controls -2 CFR §200.303 Audit Finding Threshold - 2 CFR §200.516(a) Type of Finding Internal Control over Compliance - Material Weakness Compliance - Noncompliance Questioned Costs Based on actual net expenditures and proportional match requirements: (TABLE) These questioned costs have been eliminated following receipt of amended contracts from ARC and CDBG approving the use of ORA and CDBG funds as match. Criteria The following federal regulations and grant conditions establish the requirements violated in this finding: 1. Matching Requirements - 2 CFR §200.306 Federal funds may not be used to meet a required cost share or match unless expressly authorized by the awarding agency. Matching contributions must: Be verifiable from the recipient's records Not be included as contributions for any other federal award Be necessary and reasonable for accomplishing program objectives Be allowable under the cost principles Not be paid by. the federal government under another award, unless authorized 2. Allowable Costs ... 2 CFR §200.403 Costs must be necessary, reasonable, allocable, and conform to limitations in the award terms. Costs must be adequately documented and consistent with policies that apply uniformly to both federally financed and other activities. 3. Internal Controls - 2 CFR §200.303 Recipients must establish and maintain effective internal controls to ensure compliance with feqeral statutes, regulations, and award terms. Controls should provide reasonable assurance that the organization is managing the award in compliance with applicable requirements. 4. Audit Finding Threshold-2 CFR §200.516(a) Auditors must report known questioned costs that exceed $10,000 for a federal program, even if the program was not selected for audit testing. Condition During the audit of ARC grant MS-20699 (ALN 23.002), we noted that the City of Batesville substituted $569,600 in federal ORA funds for the originally budgeted local match of $341,784. Additionally, for COBG grant ALN 14.228, the City substituted $569,600 in ORA funds and $553,000 in ARC grant funds for the originally budgeted local match of $901,784. These substitutions were made without prior written approval or executed amendments from the awarding agencies, as required under 2 CFR §200.306 and the respective grant agreements. Resolution Following the audit fieldwork, the City obtained formal amendments to both grant agreements: On October 24, 2025, ARC approved the substitution of ORA and COBG funds as match under ALN 23.002. On November 7, 2025, COBG approved the substitution of ORA and ARC funds as match under ALN 14.228. These approvals eliminate the previously identified questioned costs totaling $800,406. However, the lack of contemporaneous documentation and prior approval reflects a breakdown in internal controls and remains a material compliance issue. Cause The City lacked adequate internal controls to ensure changes to match sources were formally reviewed and approved by the awarding agencies prior to implementation. The substitution of federal funds for required local match was not documented or authorized at the time of expenditure. Effect Although questioned costs have been resolved, the City was in noncompliance with federal matching requirements and allowable cost principles at the time of expenditure. This reflects a broader control deficiency in the City's grant management process and increases the risk of future noncompliance. Recommendation We recommend the City strengthen its internal controls over grant compliance, including: Formal review and documentation of match sources prior to drawdown Written approval from awarding agencies before substituting federal funds for required match Staff training on federal match requirements and Uniform Guidance compliance Views of Responsible Officials Management concurs with the finding. The City acknowledges that federal ORA and ARC funds were applied toward required match obligations without prior approval or amendment to the respective grant agreements. ARC and CDBG representatives have since approved the substitutions through formal amendments. The City will implement procedures requiring written authorization for any future match substitutions and establish a formal review process to verify match sources prior to drawdown.
Finding 2024-001 – Unallowable Subrecipient Costs (Deficiency) Information on the Federal Programs: Continuum of Care – AL # 14.267 and Emergency Solutions Grant Program – AL # 14.231. Criteria: According to 2 CFR Part 200, Subpart F, 200.516, “the auditor must report the following as audit findings in a schedule of findings and questioned costs… Known or likely fraud affecting a Federal award, unless such fraud is otherwise reported as an audit finding in the schedule of findings and questioned costs for Federal awards.” Condition: During the current fiscal year the Corporation, based on monitoring procedures performed, determined that one of their subrecipients had been making payments to fictitious vendors and/or vendors with a significant conflict of interest resulting in resulting in questioned or unallowable costs from fiscal year 2023 and fiscal year 2024 across the federal programs listed above. Cause: There was an apparent lack of internal controls and/or segregation of duties within the subrecipient entity that did not prevent these unallowable costs from being incurred at the subrecipient level. Additionally, Corporation management did not perform subrecipient monitoring procedures in a timely manner which resulted in unallowed costs being incurred before ultimately being detected by the Corporation. Effect: Questioned or unallowable known costs of $242,398 (as identified by the Corporation) from fiscal year 2023 and fiscal year 2024 were incurred across the federal programs listed below. Questioned Costs: Federal Program FY2024 Amount FY2023 Amount AL # 14.231 $24,753 $54,737 AL # 14.231 – COVID $0 $46,176 AL # 14.267 $37,602 $2,928 Unknown $6,813 $69,389 Context: As part of subrecipient monitoring, the Corporation identified some questioned costs related to one specific subrecipient. Management of the Corporation performed testing of the disbursements made to the subrecipient while the Executive Director was employed there (from July 31, 2022 through January 4, 2024) and determined that there were $242,398 of disbursements that were either unallowable based on the supporting documentation, or were questioned costs due to lack of supporting documentation. Crowe tested a sample of the disbursements from the same time period and the results from that sample agreed to the results the Corporation found.
Finding 2024-001 – Unallowable Subrecipient Costs (Deficiency) Information on the Federal Programs: Continuum of Care – AL # 14.267 and Emergency Solutions Grant Program – AL # 14.231. Criteria: According to 2 CFR Part 200, Subpart F, 200.516, “the auditor must report the following as audit findings in a schedule of findings and questioned costs… Known or likely fraud affecting a Federal award, unless such fraud is otherwise reported as an audit finding in the schedule of findings and questioned costs for Federal awards.” Condition: During the current fiscal year the Corporation, based on monitoring procedures performed, determined that one of their subrecipients had been making payments to fictitious vendors and/or vendors with a significant conflict of interest resulting in resulting in questioned or unallowable costs from fiscal year 2023 and fiscal year 2024 across the federal programs listed above. Cause: There was an apparent lack of internal controls and/or segregation of duties within the subrecipient entity that did not prevent these unallowable costs from being incurred at the subrecipient level. Additionally, Corporation management did not perform subrecipient monitoring procedures in a timely manner which resulted in unallowed costs being incurred before ultimately being detected by the Corporation. Effect: Questioned or unallowable known costs of $242,398 (as identified by the Corporation) from fiscal year 2023 and fiscal year 2024 were incurred across the federal programs listed below. Questioned Costs: Federal Program FY2024 Amount FY2023 Amount AL # 14.231 $24,753 $54,737 AL # 14.231 – COVID $0 $46,176 AL # 14.267 $37,602 $2,928 Unknown $6,813 $69,389 Context: As part of subrecipient monitoring, the Corporation identified some questioned costs related to one specific subrecipient. Management of the Corporation performed testing of the disbursements made to the subrecipient while the Executive Director was employed there (from July 31, 2022 through January 4, 2024) and determined that there were $242,398 of disbursements that were either unallowable based on the supporting documentation, or were questioned costs due to lack of supporting documentation. Crowe tested a sample of the disbursements from the same time period and the results from that sample agreed to the results the Corporation found.
Finding 2024-001 – Unallowable Subrecipient Costs (Deficiency) Information on the Federal Programs: Continuum of Care – AL # 14.267 and Emergency Solutions Grant Program – AL # 14.231. Criteria: According to 2 CFR Part 200, Subpart F, 200.516, “the auditor must report the following as audit findings in a schedule of findings and questioned costs… Known or likely fraud affecting a Federal award, unless such fraud is otherwise reported as an audit finding in the schedule of findings and questioned costs for Federal awards.” Condition: During the current fiscal year the Corporation, based on monitoring procedures performed, determined that one of their subrecipients had been making payments to fictitious vendors and/or vendors with a significant conflict of interest resulting in resulting in questioned or unallowable costs from fiscal year 2023 and fiscal year 2024 across the federal programs listed above. Cause: There was an apparent lack of internal controls and/or segregation of duties within the subrecipient entity that did not prevent these unallowable costs from being incurred at the subrecipient level. Additionally, Corporation management did not perform subrecipient monitoring procedures in a timely manner which resulted in unallowed costs being incurred before ultimately being detected by the Corporation. Effect: Questioned or unallowable known costs of $242,398 (as identified by the Corporation) from fiscal year 2023 and fiscal year 2024 were incurred across the federal programs listed below. Questioned Costs: Federal Program FY2024 Amount FY2023 Amount AL # 14.231 $24,753 $54,737 AL # 14.231 – COVID $0 $46,176 AL # 14.267 $37,602 $2,928 Unknown $6,813 $69,389 Context: As part of subrecipient monitoring, the Corporation identified some questioned costs related to one specific subrecipient. Management of the Corporation performed testing of the disbursements made to the subrecipient while the Executive Director was employed there (from July 31, 2022 through January 4, 2024) and determined that there were $242,398 of disbursements that were either unallowable based on the supporting documentation, or were questioned costs due to lack of supporting documentation. Crowe tested a sample of the disbursements from the same time period and the results from that sample agreed to the results the Corporation found.
Federal Agency: U.S. Department of Justice Federal Program Title: Postconviction Testing of DNA Evidence; Capital Case Litigation Initiative Assistance Listing Number: 16.820; 16.746 Federal Award Identification Number and Year: Multiple Award Period: July 1, 2023 to June 30, 2024 Type of Finding: Other Matters Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: Per 2 CFR 200.516(4): Known questioned costs that are greater than $25,000 for a Federal program which is not audited as a major program should be reported as finding. Except for audit follow-up, the auditor is not required under this part to perform audit procedures for such a Federal program; therefore, the auditor will normally not find questioned costs for a program that is not audited as a major program. However, if the auditor does become aware of questioned costs for a Federal program that is not audited as a major program (e.g., as part of audit follow-up or other audit procedures) and the known questioned costs are greater than $25,000, then the auditor must report this as an audit finding. Additionally, per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. CFR 200.403(a) requires costs incurred on federal awards to be necessary and reasonable for the performance of the Federal award and be allocable thereto. Condition: CLA was notified by the Post-Award Office of Sponsored Programs that they were informed about several irregularities and potentially unallowable costs related to certain Department of Justice Awards. Context: The University conducted an internal investigation in conjunction with the Idaho State Board of Education Internal Audit and Advisory Services, the investigation identified unallowable costs/activities that were charged to Department of Justice Awards. The University notified the Department of Justice of this situation through a Disclosure Letter to the Department. The disallowed costs were related to time and effort that was not allocable to the affected grants as well as lobbying efforts and related indirect cost recoveries. Questioned costs: $65,750.67. Effect: The University was out of compliance as it relates to charging disallowable costs/activities to federal programs. Cause: An employee was found to have intentionally overridden the system of internal controls in violation of University policy. Repeat finding: No Recommendation: We recommend the University continue to foster a research and creative activity environment that stresses the importance of compliance and prompt disclosure and resolution of any self-identified issues. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
Federal Agency: U.S. Department of Justice Federal Program Title: Postconviction Testing of DNA Evidence; Capital Case Litigation Initiative Assistance Listing Number: 16.820; 16.746 Federal Award Identification Number and Year: Multiple Award Period: July 1, 2023 to June 30, 2024 Type of Finding: Other Matters Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: Per 2 CFR 200.516(4): Known questioned costs that are greater than $25,000 for a Federal program which is not audited as a major program should be reported as finding. Except for audit follow-up, the auditor is not required under this part to perform audit procedures for such a Federal program; therefore, the auditor will normally not find questioned costs for a program that is not audited as a major program. However, if the auditor does become aware of questioned costs for a Federal program that is not audited as a major program (e.g., as part of audit follow-up or other audit procedures) and the known questioned costs are greater than $25,000, then the auditor must report this as an audit finding. Additionally, per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. CFR 200.403(a) requires costs incurred on federal awards to be necessary and reasonable for the performance of the Federal award and be allocable thereto. Condition: CLA was notified by the Post-Award Office of Sponsored Programs that they were informed about several irregularities and potentially unallowable costs related to certain Department of Justice Awards. Context: The University conducted an internal investigation in conjunction with the Idaho State Board of Education Internal Audit and Advisory Services, the investigation identified unallowable costs/activities that were charged to Department of Justice Awards. The University notified the Department of Justice of this situation through a Disclosure Letter to the Department. The disallowed costs were related to time and effort that was not allocable to the affected grants as well as lobbying efforts and related indirect cost recoveries. Questioned costs: $65,750.67. Effect: The University was out of compliance as it relates to charging disallowable costs/activities to federal programs. Cause: An employee was found to have intentionally overridden the system of internal controls in violation of University policy. Repeat finding: No Recommendation: We recommend the University continue to foster a research and creative activity environment that stresses the importance of compliance and prompt disclosure and resolution of any self-identified issues. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.
U.S. Department of Labor Employment and Training Administration Passed through the N.C. Dept. of Commerce Program Name: WIOA Cluster AL# 17.258, 17.259, 17.278 Grant Number: 23A55AY000007-01-00 / AA-38547-22-55-A-37 Significant Deficiency, Nonmaterial Non-Compliance Earmarking Finding 2024-002 Criteria: In accordance with 20 CFR 681.590, local youth programs must expend not less than 20 percent of the funds allocated to them, except for the local area expenditures for administration, to provide paid and unpaid work experiences. Condition: The County Department of Social Services failed to meet the required earmark percentage for paid and unpaid work experiences for Youth Activities. Context: While performing tests over compliance related to the WIOA Cluster, we noted the above condition. Questioned Costs: In accordance with 2 CFR 200.516(a)(3), auditors are required to report known questioned costs when likely questioned costs are greater than $25,000. The results of our compliance testing noted $34,440 in known questioned costs. Effect: Program expenditures could be disproportionately paid across programs. Cause: The County failed to monitor required earmarking for program specific requirements. Recommendation: Require the County Program Directors to implement procedures to ensure that earmarking requirements are met. Name of Contact Person: Michael Coone, Social Services Assistant Director Views of Responsible Officials and Planned Corrective Actions: Management concurs with this finding and will adhere to the Corrective Action Plan in this audit report.
U.S. Department of Labor Employment and Training Administration Passed through the N.C. Dept. of Commerce Program Name: WIOA Cluster AL# 17.258, 17.259, 17.278 Grant Number: 23A55AY000007-01-00 / AA-38547-22-55-A-37 Significant Deficiency, Nonmaterial Non-Compliance Earmarking Finding 2024-002 Criteria: In accordance with 20 CFR 681.590, local youth programs must expend not less than 20 percent of the funds allocated to them, except for the local area expenditures for administration, to provide paid and unpaid work experiences. Condition: The County Department of Social Services failed to meet the required earmark percentage for paid and unpaid work experiences for Youth Activities. Context: While performing tests over compliance related to the WIOA Cluster, we noted the above condition. Questioned Costs: In accordance with 2 CFR 200.516(a)(3), auditors are required to report known questioned costs when likely questioned costs are greater than $25,000. The results of our compliance testing noted $34,440 in known questioned costs. Effect: Program expenditures could be disproportionately paid across programs. Cause: The County failed to monitor required earmarking for program specific requirements. Recommendation: Require the County Program Directors to implement procedures to ensure that earmarking requirements are met. Name of Contact Person: Michael Coone, Social Services Assistant Director Views of Responsible Officials and Planned Corrective Actions: Management concurs with this finding and will adhere to the Corrective Action Plan in this audit report.
U.S. Department of Labor Employment and Training Administration Passed through the N.C. Dept. of Commerce Program Name: WIOA Cluster AL# 17.258, 17.259, 17.278 Grant Number: 23A55AY000007-01-00 / AA-38547-22-55-A-37 Significant Deficiency, Nonmaterial Non-Compliance Earmarking Finding 2024-002 Criteria: In accordance with 20 CFR 681.590, local youth programs must expend not less than 20 percent of the funds allocated to them, except for the local area expenditures for administration, to provide paid and unpaid work experiences. Condition: The County Department of Social Services failed to meet the required earmark percentage for paid and unpaid work experiences for Youth Activities. Context: While performing tests over compliance related to the WIOA Cluster, we noted the above condition. Questioned Costs: In accordance with 2 CFR 200.516(a)(3), auditors are required to report known questioned costs when likely questioned costs are greater than $25,000. The results of our compliance testing noted $34,440 in known questioned costs. Effect: Program expenditures could be disproportionately paid across programs. Cause: The County failed to monitor required earmarking for program specific requirements. Recommendation: Require the County Program Directors to implement procedures to ensure that earmarking requirements are met. Name of Contact Person: Michael Coone, Social Services Assistant Director Views of Responsible Officials and Planned Corrective Actions: Management concurs with this finding and will adhere to the Corrective Action Plan in this audit report.
U.S. Department of Labor Employment and Training Administration Passed through the N.C. Dept. of Commerce Program Name: WIOA Cluster AL# 17.258, 17.259, 17.278 Grant Number: 23A55AY000007-01-00 / AA-38547-22-55-A-37 Significant Deficiency, Nonmaterial Non-Compliance Earmarking Finding 2024-002 Criteria: In accordance with 20 CFR 681.590, local youth programs must expend not less than 20 percent of the funds allocated to them, except for the local area expenditures for administration, to provide paid and unpaid work experiences. Condition: The County Department of Social Services failed to meet the required earmark percentage for paid and unpaid work experiences for Youth Activities. Context: While performing tests over compliance related to the WIOA Cluster, we noted the above condition. Questioned Costs: In accordance with 2 CFR 200.516(a)(3), auditors are required to report known questioned costs when likely questioned costs are greater than $25,000. The results of our compliance testing noted $34,440 in known questioned costs. Effect: Program expenditures could be disproportionately paid across programs. Cause: The County failed to monitor required earmarking for program specific requirements. Recommendation: Require the County Program Directors to implement procedures to ensure that earmarking requirements are met. Name of Contact Person: Michael Coone, Social Services Assistant Director Views of Responsible Officials and Planned Corrective Actions: Management concurs with this finding and will adhere to the Corrective Action Plan in this audit report.
U.S. Department of Labor Employment and Training Administration Passed through the N.C. Dept. of Commerce Program Name: WIOA Cluster AL# 17.258, 17.259, 17.278 Grant Number: 23A55AY000007-01-00 / AA-38547-22-55-A-37 Significant Deficiency, Nonmaterial Non-Compliance Earmarking Finding 2024-002 Criteria: In accordance with 20 CFR 681.590, local youth programs must expend not less than 20 percent of the funds allocated to them, except for the local area expenditures for administration, to provide paid and unpaid work experiences. Condition: The County Department of Social Services failed to meet the required earmark percentage for paid and unpaid work experiences for Youth Activities. Context: While performing tests over compliance related to the WIOA Cluster, we noted the above condition. Questioned Costs: In accordance with 2 CFR 200.516(a)(3), auditors are required to report known questioned costs when likely questioned costs are greater than $25,000. The results of our compliance testing noted $34,440 in known questioned costs. Effect: Program expenditures could be disproportionately paid across programs. Cause: The County failed to monitor required earmarking for program specific requirements. Recommendation: Require the County Program Directors to implement procedures to ensure that earmarking requirements are met. Name of Contact Person: Michael Coone, Social Services Assistant Director Views of Responsible Officials and Planned Corrective Actions: Management concurs with this finding and will adhere to the Corrective Action Plan in this audit report.
U.S. Department of Labor Employment and Training Administration Passed through the N.C. Dept. of Commerce Program Name: WIOA Cluster AL# 17.258, 17.259, 17.278 Grant Number: 23A55AY000007-01-00 / AA-38547-22-55-A-37 Significant Deficiency, Nonmaterial Non-Compliance Earmarking Finding 2024-002 Criteria: In accordance with 20 CFR 681.590, local youth programs must expend not less than 20 percent of the funds allocated to them, except for the local area expenditures for administration, to provide paid and unpaid work experiences. Condition: The County Department of Social Services failed to meet the required earmark percentage for paid and unpaid work experiences for Youth Activities. Context: While performing tests over compliance related to the WIOA Cluster, we noted the above condition. Questioned Costs: In accordance with 2 CFR 200.516(a)(3), auditors are required to report known questioned costs when likely questioned costs are greater than $25,000. The results of our compliance testing noted $34,440 in known questioned costs. Effect: Program expenditures could be disproportionately paid across programs. Cause: The County failed to monitor required earmarking for program specific requirements. Recommendation: Require the County Program Directors to implement procedures to ensure that earmarking requirements are met. Name of Contact Person: Michael Coone, Social Services Assistant Director Views of Responsible Officials and Planned Corrective Actions: Management concurs with this finding and will adhere to the Corrective Action Plan in this audit report.
U.S. Department of Labor Employment and Training Administration Passed through the N.C. Dept. of Commerce Program Name: WIOA Cluster AL# 17.258, 17.259, 17.278 Grant Number: 23A55AY000007-01-00 / AA-38547-22-55-A-37 Significant Deficiency, Nonmaterial Non-Compliance Earmarking Finding 2024-002 Criteria: In accordance with 20 CFR 681.590, local youth programs must expend not less than 20 percent of the funds allocated to them, except for the local area expenditures for administration, to provide paid and unpaid work experiences. Condition: The County Department of Social Services failed to meet the required earmark percentage for paid and unpaid work experiences for Youth Activities. Context: While performing tests over compliance related to the WIOA Cluster, we noted the above condition. Questioned Costs: In accordance with 2 CFR 200.516(a)(3), auditors are required to report known questioned costs when likely questioned costs are greater than $25,000. The results of our compliance testing noted $34,440 in known questioned costs. Effect: Program expenditures could be disproportionately paid across programs. Cause: The County failed to monitor required earmarking for program specific requirements. Recommendation: Require the County Program Directors to implement procedures to ensure that earmarking requirements are met. Name of Contact Person: Michael Coone, Social Services Assistant Director Views of Responsible Officials and Planned Corrective Actions: Management concurs with this finding and will adhere to the Corrective Action Plan in this audit report.
U.S. Department of Labor Employment and Training Administration Passed through the N.C. Dept. of Commerce Program Name: WIOA Cluster AL# 17.258, 17.259, 17.278 Grant Number: 23A55AY000007-01-00 / AA-38547-22-55-A-37 Significant Deficiency, Nonmaterial Non-Compliance Earmarking Finding 2024-002 Criteria: In accordance with 20 CFR 681.590, local youth programs must expend not less than 20 percent of the funds allocated to them, except for the local area expenditures for administration, to provide paid and unpaid work experiences. Condition: The County Department of Social Services failed to meet the required earmark percentage for paid and unpaid work experiences for Youth Activities. Context: While performing tests over compliance related to the WIOA Cluster, we noted the above condition. Questioned Costs: In accordance with 2 CFR 200.516(a)(3), auditors are required to report known questioned costs when likely questioned costs are greater than $25,000. The results of our compliance testing noted $34,440 in known questioned costs. Effect: Program expenditures could be disproportionately paid across programs. Cause: The County failed to monitor required earmarking for program specific requirements. Recommendation: Require the County Program Directors to implement procedures to ensure that earmarking requirements are met. Name of Contact Person: Michael Coone, Social Services Assistant Director Views of Responsible Officials and Planned Corrective Actions: Management concurs with this finding and will adhere to the Corrective Action Plan in this audit report.
U.S. Department of Labor Employment and Training Administration Passed through the N.C. Dept. of Commerce Program Name: WIOA Cluster AL# 17.258, 17.259, 17.278 Grant Number: 23A55AY000007-01-00 / AA-38547-22-55-A-37 Significant Deficiency, Nonmaterial Non-Compliance Earmarking Finding 2024-002 Criteria: In accordance with 20 CFR 681.590, local youth programs must expend not less than 20 percent of the funds allocated to them, except for the local area expenditures for administration, to provide paid and unpaid work experiences. Condition: The County Department of Social Services failed to meet the required earmark percentage for paid and unpaid work experiences for Youth Activities. Context: While performing tests over compliance related to the WIOA Cluster, we noted the above condition. Questioned Costs: In accordance with 2 CFR 200.516(a)(3), auditors are required to report known questioned costs when likely questioned costs are greater than $25,000. The results of our compliance testing noted $34,440 in known questioned costs. Effect: Program expenditures could be disproportionately paid across programs. Cause: The County failed to monitor required earmarking for program specific requirements. Recommendation: Require the County Program Directors to implement procedures to ensure that earmarking requirements are met. Name of Contact Person: Michael Coone, Social Services Assistant Director Views of Responsible Officials and Planned Corrective Actions: Management concurs with this finding and will adhere to the Corrective Action Plan in this audit report.
U.S. Department of Labor Employment and Training Administration Passed through the N.C. Dept. of Commerce Program Name: WIOA Cluster AL# 17.258, 17.259, 17.278 Grant Number: 23A55AY000007-01-00 / AA-38547-22-55-A-37 Significant Deficiency, Nonmaterial Non-Compliance Earmarking Finding 2024-002 Criteria: In accordance with 20 CFR 681.590, local youth programs must expend not less than 20 percent of the funds allocated to them, except for the local area expenditures for administration, to provide paid and unpaid work experiences. Condition: The County Department of Social Services failed to meet the required earmark percentage for paid and unpaid work experiences for Youth Activities. Context: While performing tests over compliance related to the WIOA Cluster, we noted the above condition. Questioned Costs: In accordance with 2 CFR 200.516(a)(3), auditors are required to report known questioned costs when likely questioned costs are greater than $25,000. The results of our compliance testing noted $34,440 in known questioned costs. Effect: Program expenditures could be disproportionately paid across programs. Cause: The County failed to monitor required earmarking for program specific requirements. Recommendation: Require the County Program Directors to implement procedures to ensure that earmarking requirements are met. Name of Contact Person: Michael Coone, Social Services Assistant Director Views of Responsible Officials and Planned Corrective Actions: Management concurs with this finding and will adhere to the Corrective Action Plan in this audit report.
U.S. Department of Labor Employment and Training Administration Passed through the N.C. Dept. of Commerce Program Name: WIOA Cluster AL# 17.258, 17.259, 17.278 Grant Number: 23A55AY000007-01-00 / AA-38547-22-55-A-37 Significant Deficiency, Nonmaterial Non-Compliance Earmarking Finding 2024-002 Criteria: In accordance with 20 CFR 681.590, local youth programs must expend not less than 20 percent of the funds allocated to them, except for the local area expenditures for administration, to provide paid and unpaid work experiences. Condition: The County Department of Social Services failed to meet the required earmark percentage for paid and unpaid work experiences for Youth Activities. Context: While performing tests over compliance related to the WIOA Cluster, we noted the above condition. Questioned Costs: In accordance with 2 CFR 200.516(a)(3), auditors are required to report known questioned costs when likely questioned costs are greater than $25,000. The results of our compliance testing noted $34,440 in known questioned costs. Effect: Program expenditures could be disproportionately paid across programs. Cause: The County failed to monitor required earmarking for program specific requirements. Recommendation: Require the County Program Directors to implement procedures to ensure that earmarking requirements are met. Name of Contact Person: Michael Coone, Social Services Assistant Director Views of Responsible Officials and Planned Corrective Actions: Management concurs with this finding and will adhere to the Corrective Action Plan in this audit report.
U.S. Department of Labor Employment and Training Administration Passed through the N.C. Dept. of Commerce Program Name: WIOA Cluster AL# 17.258, 17.259, 17.278 Grant Number: 23A55AY000007-01-00 / AA-38547-22-55-A-37 Significant Deficiency, Nonmaterial Non-Compliance Earmarking Finding 2024-002 Criteria: In accordance with 20 CFR 681.590, local youth programs must expend not less than 20 percent of the funds allocated to them, except for the local area expenditures for administration, to provide paid and unpaid work experiences. Condition: The County Department of Social Services failed to meet the required earmark percentage for paid and unpaid work experiences for Youth Activities. Context: While performing tests over compliance related to the WIOA Cluster, we noted the above condition. Questioned Costs: In accordance with 2 CFR 200.516(a)(3), auditors are required to report known questioned costs when likely questioned costs are greater than $25,000. The results of our compliance testing noted $34,440 in known questioned costs. Effect: Program expenditures could be disproportionately paid across programs. Cause: The County failed to monitor required earmarking for program specific requirements. Recommendation: Require the County Program Directors to implement procedures to ensure that earmarking requirements are met. Name of Contact Person: Michael Coone, Social Services Assistant Director Views of Responsible Officials and Planned Corrective Actions: Management concurs with this finding and will adhere to the Corrective Action Plan in this audit report.
Statement of condition: The Organization expended federal funds during its fiscal years ended June 30, 2023 and 2022 totaling $876,797 and $807,292, respectively. These amounts were in excess of $750,000 and an audit of major federal program compliance (hereinafter “Single Audit”) was not performed within the required nine (9) months after year-end. Criteria: The audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (hereinafter “Uniform Guidance”) require a Single Audit to be performed when expenditures of federal awards exceed $750,000 for the fiscal years ended June 30, 2023 and 2022. Cause of condition: Failure by the Organization to properly prepare its Schedule of Federal Expenditures and its predecessor audit firm to properly identify federal funds included in the Organization’s routine funding. Effect of condition and context: Specifically, this is not in compliance with 2 CFR 200.516 of the Uniform Guidance. Recommendation: We strongly recommend the Organization engage an audit firm to complete the required Single Audits for its fiscal 2023 and 2022 year-ends. Management’s response: Management has engaged its current auditing firm to complete the required Single Audits for its fiscal 2023 and 2022 year-ends.
Statement of condition: The Organization expended federal funds during its fiscal years ended June 30, 2023 and 2022 totaling $876,797 and $807,292, respectively. These amounts were in excess of $750,000 and an audit of major federal program compliance (hereinafter “Single Audit”) was not performed within the required nine (9) months after year-end. Criteria: The audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (hereinafter “Uniform Guidance”) require a Single Audit to be performed when expenditures of federal awards exceed $750,000 for the fiscal years ended June 30, 2023 and 2022. Cause of condition: Failure by the Organization to properly prepare its Schedule of Federal Expenditures and its predecessor audit firm to properly identify federal funds included in the Organization’s routine funding. Effect of condition and context: Specifically, this is not in compliance with 2 CFR 200.516 of the Uniform Guidance. Recommendation: We strongly recommend the Organization engage an audit firm to complete the required Single Audits for its fiscal 2023 and 2022 year-ends. Management’s response: Management has engaged its current auditing firm to complete the required Single Audits for its fiscal 2023 and 2022 year-ends.
Statement of condition: The Organization expended federal funds during its fiscal years ended June 30, 2023 and 2022 totaling $876,797 and $807,292, respectively. These amounts were in excess of $750,000 and an audit of major federal program compliance (hereinafter “Single Audit”) was not performed within the required nine (9) months after year-end. Criteria: The audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (hereinafter “Uniform Guidance”) require a Single Audit to be performed when expenditures of federal awards exceed $750,000 for the fiscal years ended June 30, 2023 and 2022. Cause of condition: Failure by the Organization to properly prepare its Schedule of Federal Expenditures and its predecessor audit firm to properly identify federal funds included in the Organization’s routine funding. Effect of condition and context: Specifically, this is not in compliance with 2 CFR 200.516 of the Uniform Guidance. Recommendation: We strongly recommend the Organization engage an audit firm to complete the required Single Audits for its fiscal 2023 and 2022 year-ends. Management’s response: Management has engaged its current auditing firm to complete the required Single Audits for its fiscal 2023 and 2022 year-ends.
Statement of condition: The Organization expended federal funds during its fiscal years ended June 30, 2023 and 2022 totaling $876,797 and $807,292, respectively. These amounts were in excess of $750,000 and an audit of major federal program compliance (hereinafter “Single Audit”) was not performed within the required nine (9) months after year-end. Criteria: The audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (hereinafter “Uniform Guidance”) require a Single Audit to be performed when expenditures of federal awards exceed $750,000 for the fiscal years ended June 30, 2023 and 2022. Cause of condition: Failure by the Organization to properly prepare its Schedule of Federal Expenditures and its predecessor audit firm to properly identify federal funds included in the Organization’s routine funding. Effect of condition and context: Specifically, this is not in compliance with 2 CFR 200.516 of the Uniform Guidance. Recommendation: We strongly recommend the Organization engage an audit firm to complete the required Single Audits for its fiscal 2023 and 2022 year-ends. Management’s response: Management has engaged its current auditing firm to complete the required Single Audits for its fiscal 2023 and 2022 year-ends.
Statement of condition: The Organization expended federal funds during its fiscal years ended June 30, 2023 and 2022 totaling $876,797 and $807,292, respectively. These amounts were in excess of $750,000 and an audit of major federal program compliance (hereinafter “Single Audit”) was not performed within the required nine (9) months after year-end. Criteria: The audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (hereinafter “Uniform Guidance”) require a Single Audit to be performed when expenditures of federal awards exceed $750,000 for the fiscal years ended June 30, 2023 and 2022. Cause of condition: Failure by the Organization to properly prepare its Schedule of Federal Expenditures and its predecessor audit firm to properly identify federal funds included in the Organization’s routine funding. Effect of condition and context: Specifically, this is not in compliance with 2 CFR 200.516 of the Uniform Guidance. Recommendation: We strongly recommend the Organization engage an audit firm to complete the required Single Audits for its fiscal 2023 and 2022 year-ends. Management’s response: Management has engaged its current auditing firm to complete the required Single Audits for its fiscal 2023 and 2022 year-ends.
Statement of condition: The Organization expended federal funds during its fiscal years ended June 30, 2023 and 2022 totaling $876,797 and $807,292, respectively. These amounts were in excess of $750,000 and an audit of major federal program compliance (hereinafter “Single Audit”) was not performed within the required nine (9) months after year-end. Criteria: The audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (hereinafter “Uniform Guidance”) require a Single Audit to be performed when expenditures of federal awards exceed $750,000 for the fiscal years ended June 30, 2023 and 2022. Cause of condition: Failure by the Organization to properly prepare its Schedule of Federal Expenditures and its predecessor audit firm to properly identify federal funds included in the Organization’s routine funding. Effect of condition and context: Specifically, this is not in compliance with 2 CFR 200.516 of the Uniform Guidance. Recommendation: We strongly recommend the Organization engage an audit firm to complete the required Single Audits for its fiscal 2023 and 2022 year-ends. Management’s response: Management has engaged its current auditing firm to complete the required Single Audits for its fiscal 2023 and 2022 year-ends.
Statement of condition: The Organization expended federal funds during its fiscal years ended June 30, 2023 and 2022 totaling $876,797 and $807,292, respectively. These amounts were in excess of $750,000 and an audit of major federal program compliance (hereinafter “Single Audit”) was not performed within the required nine (9) months after year-end. Criteria: The audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (hereinafter “Uniform Guidance”) require a Single Audit to be performed when expenditures of federal awards exceed $750,000 for the fiscal years ended June 30, 2023 and 2022. Cause of condition: Failure by the Organization to properly prepare its Schedule of Federal Expenditures and its predecessor audit firm to properly identify federal funds included in the Organization’s routine funding. Effect of condition and context: Specifically, this is not in compliance with 2 CFR 200.516 of the Uniform Guidance. Recommendation: We strongly recommend the Organization engage an audit firm to complete the required Single Audits for its fiscal 2023 and 2022 year-ends. Management’s response: Management has engaged its current auditing firm to complete the required Single Audits for its fiscal 2023 and 2022 year-ends.
Statement of condition: The Organization expended federal funds during its fiscal years ended June 30, 2023 and 2022 totaling $876,797 and $807,292, respectively. These amounts were in excess of $750,000 and an audit of major federal program compliance (hereinafter “Single Audit”) was not performed within the required nine (9) months after year-end. Criteria: The audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (hereinafter “Uniform Guidance”) require a Single Audit to be performed when expenditures of federal awards exceed $750,000 for the fiscal years ended June 30, 2023 and 2022. Cause of condition: Failure by the Organization to properly prepare its Schedule of Federal Expenditures and its predecessor audit firm to properly identify federal funds included in the Organization’s routine funding. Effect of condition and context: Specifically, this is not in compliance with 2 CFR 200.516 of the Uniform Guidance. Recommendation: We strongly recommend the Organization engage an audit firm to complete the required Single Audits for its fiscal 2023 and 2022 year-ends. Management’s response: Management has engaged its current auditing firm to complete the required Single Audits for its fiscal 2023 and 2022 year-ends.
OAK PARK ELEMENTARY SCHOOL DISTRICT 97 06-016-0970-02 SCHEDULE OF FINDINGS AND QUESTIONED COSTS Year Ending June 30, 2024 SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS 1. FINDING NUMBER:14 2024 - 004 2. THIS FINDING IS: X New Repeat from Prior year? Year originally reported? 3. Federal Program Name and Year: SPECIAL EDUCATION CLUSTER (IDEA) 4. Project No.: 024-4620-00, 024-4625-00, 024-4998-ID, 024-4998-PS, 024-4600-00, 023-4600-00 5. AL No.: 84.173 & 84.027 6. Passed Through: Illinois State Board of Education 7. Federal Agency: U.S. Department of Education 8. Criteria or specific requirement (including statutory, regulatory, or other citation) "IDEA, Part B funds received by an LEA cannot be used, except under certain limited circumstances, to reduce the level of expenditures for the education of children with disabilities made by the LEA from local funds, or a combination of State and local funds, below the level of those expenditures for the preceding fiscal year. To meet this requirement, LEAs must meet (1) the eligibility standard of 34 CFR section 300.203(a)) and (2) the compliance standard of 34 CFR section 300.203(b)." 9. Condition15 The District did not meet its maintenance of effort on either the aggregate or the per capita basis for fiscal year 2024. The shortfall in maintenance of effort was $401,982. 10. Questioned Costs16 The District's maintenance of effort calculation identified a decrease in non-federally funded special education related expenditures from the prior year of $401,982 in addition to a per capita decrease of $2,591 from fiscal year 2023 amounts. 11. Context17 N/A- there is only one MOE requirement. The grant was out of compliance. This is not a transactional level requirement. 12. Effect As the District is out of compliance with the maintenance of effort requirements, it is at risk of having to return federal funds. 13. Cause The finding was caused by a lack of monitoring over the maintenance of effort requirement. 14. Recommendation It is recommended that the District monitor compliance with maintenance of effort throughout the fiscal year to ensure it is met at year end. 15. Management's response18 See corrective action plan. 14 See footnote 11. 15 Include facts that support the deficiency identified on the audit finding (§200.516 (b)(3)). 16 Identify questioned costs as required by §200.516 (a)(3 - 4). 17 See footnote 12. 18 To the extent practical, indicate when management does not agree with the finding, questioned cost, or both.
OAK PARK ELEMENTARY SCHOOL DISTRICT 97 06-016-0970-02 SCHEDULE OF FINDINGS AND QUESTIONED COSTS Year Ending June 30, 2024 SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS 1. FINDING NUMBER:14 2024 - 004 2. THIS FINDING IS: X New Repeat from Prior year? Year originally reported? 3. Federal Program Name and Year: SPECIAL EDUCATION CLUSTER (IDEA) 4. Project No.: 024-4620-00, 024-4625-00, 024-4998-ID, 024-4998-PS, 024-4600-00, 023-4600-00 5. AL No.: 84.173 & 84.027 6. Passed Through: Illinois State Board of Education 7. Federal Agency: U.S. Department of Education 8. Criteria or specific requirement (including statutory, regulatory, or other citation) "IDEA, Part B funds received by an LEA cannot be used, except under certain limited circumstances, to reduce the level of expenditures for the education of children with disabilities made by the LEA from local funds, or a combination of State and local funds, below the level of those expenditures for the preceding fiscal year. To meet this requirement, LEAs must meet (1) the eligibility standard of 34 CFR section 300.203(a)) and (2) the compliance standard of 34 CFR section 300.203(b)." 9. Condition15 The District did not meet its maintenance of effort on either the aggregate or the per capita basis for fiscal year 2024. The shortfall in maintenance of effort was $401,982. 10. Questioned Costs16 The District's maintenance of effort calculation identified a decrease in non-federally funded special education related expenditures from the prior year of $401,982 in addition to a per capita decrease of $2,591 from fiscal year 2023 amounts. 11. Context17 N/A- there is only one MOE requirement. The grant was out of compliance. This is not a transactional level requirement. 12. Effect As the District is out of compliance with the maintenance of effort requirements, it is at risk of having to return federal funds. 13. Cause The finding was caused by a lack of monitoring over the maintenance of effort requirement. 14. Recommendation It is recommended that the District monitor compliance with maintenance of effort throughout the fiscal year to ensure it is met at year end. 15. Management's response18 See corrective action plan. 14 See footnote 11. 15 Include facts that support the deficiency identified on the audit finding (§200.516 (b)(3)). 16 Identify questioned costs as required by §200.516 (a)(3 - 4). 17 See footnote 12. 18 To the extent practical, indicate when management does not agree with the finding, questioned cost, or both.
OAK PARK ELEMENTARY SCHOOL DISTRICT 97 06-016-0970-02 SCHEDULE OF FINDINGS AND QUESTIONED COSTS Year Ending June 30, 2024 SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS 1. FINDING NUMBER:14 2024 - 004 2. THIS FINDING IS: X New Repeat from Prior year? Year originally reported? 3. Federal Program Name and Year: SPECIAL EDUCATION CLUSTER (IDEA) 4. Project No.: 024-4620-00, 024-4625-00, 024-4998-ID, 024-4998-PS, 024-4600-00, 023-4600-00 5. AL No.: 84.173 & 84.027 6. Passed Through: Illinois State Board of Education 7. Federal Agency: U.S. Department of Education 8. Criteria or specific requirement (including statutory, regulatory, or other citation) "IDEA, Part B funds received by an LEA cannot be used, except under certain limited circumstances, to reduce the level of expenditures for the education of children with disabilities made by the LEA from local funds, or a combination of State and local funds, below the level of those expenditures for the preceding fiscal year. To meet this requirement, LEAs must meet (1) the eligibility standard of 34 CFR section 300.203(a)) and (2) the compliance standard of 34 CFR section 300.203(b)." 9. Condition15 The District did not meet its maintenance of effort on either the aggregate or the per capita basis for fiscal year 2024. The shortfall in maintenance of effort was $401,982. 10. Questioned Costs16 The District's maintenance of effort calculation identified a decrease in non-federally funded special education related expenditures from the prior year of $401,982 in addition to a per capita decrease of $2,591 from fiscal year 2023 amounts. 11. Context17 N/A- there is only one MOE requirement. The grant was out of compliance. This is not a transactional level requirement. 12. Effect As the District is out of compliance with the maintenance of effort requirements, it is at risk of having to return federal funds. 13. Cause The finding was caused by a lack of monitoring over the maintenance of effort requirement. 14. Recommendation It is recommended that the District monitor compliance with maintenance of effort throughout the fiscal year to ensure it is met at year end. 15. Management's response18 See corrective action plan. 14 See footnote 11. 15 Include facts that support the deficiency identified on the audit finding (§200.516 (b)(3)). 16 Identify questioned costs as required by §200.516 (a)(3 - 4). 17 See footnote 12. 18 To the extent practical, indicate when management does not agree with the finding, questioned cost, or both.
OAK PARK ELEMENTARY SCHOOL DISTRICT 97 06-016-0970-02 SCHEDULE OF FINDINGS AND QUESTIONED COSTS Year Ending June 30, 2024 SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS 1. FINDING NUMBER:14 2024 - 004 2. THIS FINDING IS: X New Repeat from Prior year? Year originally reported? 3. Federal Program Name and Year: SPECIAL EDUCATION CLUSTER (IDEA) 4. Project No.: 024-4620-00, 024-4625-00, 024-4998-ID, 024-4998-PS, 024-4600-00, 023-4600-00 5. AL No.: 84.173 & 84.027 6. Passed Through: Illinois State Board of Education 7. Federal Agency: U.S. Department of Education 8. Criteria or specific requirement (including statutory, regulatory, or other citation) "IDEA, Part B funds received by an LEA cannot be used, except under certain limited circumstances, to reduce the level of expenditures for the education of children with disabilities made by the LEA from local funds, or a combination of State and local funds, below the level of those expenditures for the preceding fiscal year. To meet this requirement, LEAs must meet (1) the eligibility standard of 34 CFR section 300.203(a)) and (2) the compliance standard of 34 CFR section 300.203(b)." 9. Condition15 The District did not meet its maintenance of effort on either the aggregate or the per capita basis for fiscal year 2024. The shortfall in maintenance of effort was $401,982. 10. Questioned Costs16 The District's maintenance of effort calculation identified a decrease in non-federally funded special education related expenditures from the prior year of $401,982 in addition to a per capita decrease of $2,591 from fiscal year 2023 amounts. 11. Context17 N/A- there is only one MOE requirement. The grant was out of compliance. This is not a transactional level requirement. 12. Effect As the District is out of compliance with the maintenance of effort requirements, it is at risk of having to return federal funds. 13. Cause The finding was caused by a lack of monitoring over the maintenance of effort requirement. 14. Recommendation It is recommended that the District monitor compliance with maintenance of effort throughout the fiscal year to ensure it is met at year end. 15. Management's response18 See corrective action plan. 14 See footnote 11. 15 Include facts that support the deficiency identified on the audit finding (§200.516 (b)(3)). 16 Identify questioned costs as required by §200.516 (a)(3 - 4). 17 See footnote 12. 18 To the extent practical, indicate when management does not agree with the finding, questioned cost, or both.
Criteria: 2 CFR 200.319 states that all procurement transactions under the Federal award must be conducted in a manner that provides full and open competition and is consistent with Federal procurement standards. 2 CFR 200.214 states in part that recipients and subrecipients are subject to the nonprocurement debarment and suspension regulations. In addition, 2 CFR 200.303 in part states that a recipient of a Federal award must establish, document, and maintain effective internal control over the Federal award. Condition: We have selected and tested three of the largest vendors from the Child Nutrition Cluster for compliance with procurement and suspension and debarment. We identified that one vendor was not properly procured, in accordance with 2 CFR 200.319–2 CFR 200.324. As a result, the District incurred questioned costs in the amount of $31,401.63, which was in excess of $25,000 Federal requirement, based on 2 CFR 200.516. Also, the District did not perform procedures to verify suspension and debarment on the same vendor. Cause: District’s internal controls over procurement in the Child Nutrition Cluster were properly designed but not operating effectively to verify that all vendors are properly procured and verified for suspension and debarment. The District did not properly procure one vendor within the Child Nutrition Cluster that incurred questioned costs in excess of the $25,000 threshold, based on 2 CFR 200.516. Effect: The District did not properly procure one vendor within the Child Nutrition Cluster that incurred questioned costs in excess of the $25,000 threshold, based on 2 CFR 200.516, and, as a result, revealed a significant deficiency in internal controls over procurement in the Child Nutrition Cluster. Repeat Finding: No. Recommendation: We recommend that the District re-evaluate the procurement processes in the Child Nutrition Services program and re-evaluate the design of internal controls over procurement and suspension and debarment to be in compliance with the Federal requirements and the District’s procurement policy.
2024-002 Finding in accordance with 2 CFR section 200.516(a) Program Titles: COVID-19 Education Stabilization Fund Assistance Listing Number: 84.425 Pass-through Entity: Virginia Department of Education Compliance Requirement: Special Tests and Provisions Finding Type: Noncompliance Criteria: Construction contracts, in excess of $2,000 financed by federal assistance funds, shall include a provision that the contractor or subcontractor pay prevailing wage rates established by the Department of Labor (DOL). In addition, the contractor or subcontractor must submit to the nonfederal entity a copy of the payroll and a statement of compliance weekly. Condition: A Federally funded construction contract did not include the provision that the contractor or subcontractor must pay prevailing wage rates established by the DOL nor did the School Board receive certified payrolls from the contractor. Questioned Costs: Unknown Context: The contracts with this vendor in total were in the amount of $165,720 for renovations at Blue Ridge Elementary. The School Board had program expenditures totaling $1,042,347 and it appears there were only two vendors that were required to comply with these Special Tests and Provisions. The other contractor complied with these requirements. Effect: Unable to determine if prevailing wage rates were paid on the construction contract. Cause: The federal program is fairly new and the compliance requirement was not known by School Board personnel. In addition, guidance from the federal government was not provided by the State Funding Agency. Recommendation: Management should implement a process to review compliance requirements for all federal assistance funds grants to ensure that all compliance requirements have been met. Management's Response: Management will review its process for reviewing compliance requirements for all federal assistance funds.
2024-002 Finding in accordance with 2 CFR section 200.516(a) Program Titles: COVID-19 Education Stabilization Fund Assistance Listing Number: 84.425 Pass-through Entity: Virginia Department of Education Compliance Requirement: Special Tests and Provisions Finding Type: Noncompliance Criteria: Construction contracts, in excess of $2,000 financed by federal assistance funds, shall include a provision that the contractor or subcontractor pay prevailing wage rates established by the Department of Labor (DOL). In addition, the contractor or subcontractor must submit to the nonfederal entity a copy of the payroll and a statement of compliance weekly. Condition: A Federally funded construction contract did not include the provision that the contractor or subcontractor must pay prevailing wage rates established by the DOL nor did the School Board receive certified payrolls from the contractor. Questioned Costs: Unknown Context: The contracts with this vendor in total were in the amount of $165,720 for renovations at Blue Ridge Elementary. The School Board had program expenditures totaling $1,042,347 and it appears there were only two vendors that were required to comply with these Special Tests and Provisions. The other contractor complied with these requirements. Effect: Unable to determine if prevailing wage rates were paid on the construction contract. Cause: The federal program is fairly new and the compliance requirement was not known by School Board personnel. In addition, guidance from the federal government was not provided by the State Funding Agency. Recommendation: Management should implement a process to review compliance requirements for all federal assistance funds grants to ensure that all compliance requirements have been met. Management's Response: Management will review its process for reviewing compliance requirements for all federal assistance funds.
2024-002 – MATERIAL WEAKNESS - FEDERAL COMPLIANCE – CHILD NUTRITION CLUSTER (50000) FEDERAL PROGRAM: Child Nutrition Cluster FEDERAL AGENCY: U.S. Department of Agriculture AWARD YEAR: 2023-2024 ASSISTANCE LISTING NUMBER: 10.555 NAME OF PASS-THROUGH ENTITY: California Department of Education Criteria: The Uniform Guidance Department of Agriculture section under the compliance requirements Activities Allowed or Unallowed, and Allowable Costs state that costs charged be supported by appropriate documentation, and correctly charged as to account, amount and period. Condition: As a result of our audit procedures, accounts receivable was not recorded for the March 2024, April 2024 and June 2024 funds once the monthly reimbursement was submitted to CNIPS. There were no instances noted of unallowable costs but rather not recording the revenue in the proper period. Cause: The District does not have proper controls in place to track accounts receivable and detect when funds have not been received for an extended period of time. Context: 10.555 Child Nutrition Cluster was audited as a major program in fiscal year 2022-23. Procedures were performed as a follow up to the finding noted at 2023-002 in accordance with 2CFR 200.516(a). Effect: Child Nutrition revenue related to the March, April and June 2024 reimbursements was not recorded and the Cafeteria Fund Revenue and Accounts Receivable was understated by $47,404. Fiscal Impact/Questioned Costs: The net questioned costs totaled $47,404. Recommendation: This is a repeat finding. We recommend the District implement controls to properly record accounts receivable for all federal programs and monitor funds to ensure the District is receiving federal awards timely. Views of Responsible Officials and Planned Corrective Actions: The District agrees and has already implemented processed to ensure receivables are created with each claim created in CNIP.
2024-002 – MATERIAL WEAKNESS - FEDERAL COMPLIANCE – CHILD NUTRITION CLUSTER (50000) FEDERAL PROGRAM: Child Nutrition Cluster FEDERAL AGENCY: U.S. Department of Agriculture AWARD YEAR: 2023-2024 ASSISTANCE LISTING NUMBER: 10.555 NAME OF PASS-THROUGH ENTITY: California Department of Education Criteria: The Uniform Guidance Department of Agriculture section under the compliance requirements Activities Allowed or Unallowed, and Allowable Costs state that costs charged be supported by appropriate documentation, and correctly charged as to account, amount and period. Condition: As a result of our audit procedures, accounts receivable was not recorded for the March 2024, April 2024 and June 2024 funds once the monthly reimbursement was submitted to CNIPS. There were no instances noted of unallowable costs but rather not recording the revenue in the proper period. Cause: The District does not have proper controls in place to track accounts receivable and detect when funds have not been received for an extended period of time. Context: 10.555 Child Nutrition Cluster was audited as a major program in fiscal year 2022-23. Procedures were performed as a follow up to the finding noted at 2023-002 in accordance with 2CFR 200.516(a). Effect: Child Nutrition revenue related to the March, April and June 2024 reimbursements was not recorded and the Cafeteria Fund Revenue and Accounts Receivable was understated by $47,404. Fiscal Impact/Questioned Costs: The net questioned costs totaled $47,404. Recommendation: This is a repeat finding. We recommend the District implement controls to properly record accounts receivable for all federal programs and monitor funds to ensure the District is receiving federal awards timely. Views of Responsible Officials and Planned Corrective Actions: The District agrees and has already implemented processed to ensure receivables are created with each claim created in CNIP.
Finding 2024-001 Payment to fraudulent subrecipient account - cyber incident Repeat Finding No Federal Program Title U.S. Department of Health and Human Services 93.600 Head Start Award # 05CH012065-02-00 Award Year 9/1/2022 – 8/31/2023 Finding In connection with a cyber incident at a subrecipient, Chicago Commons Association (Commons) sent two federal fund payments to a fraudulent party acting as the subrecipient. Criteria 2 CFR 200.305 (b) describes federal payments for recipients and subrecipients other than states, whether the payment is made by electronic funds transfer or by other means. Per 2 CFR 200.516(a), the auditor must report as an audit finding various items including known or likely fraud affecting a federal award. Audit finding detail and clarity is described in the next section, 2 CFR 200.516(b), which requires specific information to be included such as “(3) The condition found, including facts that support the deficiency found in the audit finding.” Condition The design and execution of certain internal controls were not successful in preventing or detecting Commons’ payments to a bank account controlled by a fraudulent party posing as a subrecipient. This resulted from a scheme related to a cyber incident at the subrecipient. Gads Hill Center (GHC), a nonprofit after-school program located in Chicago and a subrecipient/delegate agency of Commons, was victim to a cyber incident whereby a fraudulent party was able to take control of GHC’s email and telephone systems. This fraudulent party then contacted Commons AP manager via email on August 7, 2023, posing as the GHC Chief Financial Officer. Through email communications with the Commons AP manager and VP of Finance, this fraudulent party submitted updated banking/ACH information for GHC to change their ACH information from Fifth Third Bank (the valid GHC bank account) to Truist Bank (the fraudulent party’s bank account). An email was sent from the Commons AP manager to the Commons VP of Finance to have the information updated in the system. Commons’ policies require that a request received for this type of change to be substantiated through a direct phone call to the subrecipient. The Commons AP manager called the GHC CFO (the number used was Pilsen location shown on the GHC website) but the call went unanswered (and voicemail was full). The AP manager and GHC CFO scheduled a call for the next week and the AP manager received a phone call from an identical phone number from an individual who identified himself as the GHC CFO, and completed the verification process. New banking information was then entered and approved in Commons’ primary banking partner’s system (US Bank). These emails and calls happened between August 7 and August 15, 2023. Commons received a voucher from GHC and made a $70,121.99 payment to Truist Bank on August 17, using the updated ACH information. The primary banking partner of Commons flagged this payment as potentially fraudulent because the name on the ACH payment did not match the name listed on the bank account, and contacted Commons. Commons communicated that the banking information was correct, and the payment was then released on August 22. Another GHC-submitted voucher was received, and $640,318.83 was also paid to Truist Bank on August 24, 2023. The payments were not received by GHC. GHC subsequently contacted Commons to follow up about the status of the payments due and through the ensuing discussion the payments to the fraudulent Truist Bank account were ultimately discovered. The two submitted vouchers for expenses incurred by GHC were valid, in connection with program services performed by GHC. Commons reviewed, approved and submitted the two vouchers to the U.S. Department of Health and Human Services (the funder) for reimbursement. The funder approved the expenses, funds were released to Commons and then disbursed by Commons to the Truist Bank account which management believed belonged to GHC. Commons recorded and reported revenue and expense (payment to subrecipient) for the amounts of the vouchers received and paid. Because GHC incurred the expenses but never received the reimbursement funds, GHC absorbed the loss. Cause Commons personnel had followed established processes and internal controls as intended. However, the design and execution of the controls were not successful in preventing or detecting payments to a fraudulent account. Management believes the sophistication of the fraud scheme exceeded the effectiveness of the controls. Effect The change in ACH information resulted in two Commons’ payments of federal funds totaling $710,440.82 made to a bank account controlled by the fraudulent party acting as the subrecipient. Context Chicago Commons made us aware of this matter which appears to be an isolated incident for the year ended June 30, 2024. Questioned Costs There were no known questioned costs. Recommendation We recommend that Commons strengthens its internal controls in verifying a requested bank account change. For example, the procedure can include a requirement for the phone call to be made by an individual at Commons with personal knowledge and familiarity with a specific individual at the organization requesting the change. Views of Responsible Officials Management is in agreement with this finding. See corrective action plan.
Federal Program – Student Financial Assistance Cluster – Assistance Listing Numbers 84.063, 84.007 and 84.268 – U.S. Department of Education Program Year 2023-2024 Criteria or Specific Requirement – 2 CFR 200.516(a), Paragraph 13.39(e) – Known or Likely Fraud Affecting a Federal Award Condition – Financial aid funds were provided to six fraudulent student accounts; the issue was identified by the school and reported to the U.S. Department of Education. Questioned Costs – $54,112 Context – During a review of the awards population for fiscal year 2024, the University identified six accounts that had duplicate contact and bank information. After further investigation, these accounts were determined to be fraudulently created. In total, $54,112 in funds were paid out. The school worked with the U.S. Department of Education’s CyberIncident Division to inform the Department of the fraudulent activity. Effect – The University allowed refunds to be made from financial aid awarded to fraudulent student accounts resulting in questioned costs. Cause – The University had detective rather than preventative controls in place regarding distributions of financial aid funds to repeating accounts or individuals. Identification as a Repeat Finding, if Applicable – N/A Recommendation – The University should implement procedures to identify duplicate contact and bank information across student accounts automatically or a process to check for duplicates prior to financial aid distribution. Views of Responsible Officials and Planned Corrective Actions – Management agrees with the findings and has put the following in place. The Bursar will work with ITS to perform a scan of all students’ accounts for duplicate contact and banking information. If duplicates are found, students will be notified and accounts frozen until students are identified. This will be critical before refund checks are dispersed to students every semester. The amount of $54,112 will be paid back with the next draw down before February 28, 2025.
Federal Program – Student Financial Assistance Cluster – Assistance Listing Numbers 84.063, 84.007 and 84.268 – U.S. Department of Education Program Year 2023-2024 Criteria or Specific Requirement – 2 CFR 200.516(a), Paragraph 13.39(e) – Known or Likely Fraud Affecting a Federal Award Condition – Financial aid funds were provided to six fraudulent student accounts; the issue was identified by the school and reported to the U.S. Department of Education. Questioned Costs – $54,112 Context – During a review of the awards population for fiscal year 2024, the University identified six accounts that had duplicate contact and bank information. After further investigation, these accounts were determined to be fraudulently created. In total, $54,112 in funds were paid out. The school worked with the U.S. Department of Education’s CyberIncident Division to inform the Department of the fraudulent activity. Effect – The University allowed refunds to be made from financial aid awarded to fraudulent student accounts resulting in questioned costs. Cause – The University had detective rather than preventative controls in place regarding distributions of financial aid funds to repeating accounts or individuals. Identification as a Repeat Finding, if Applicable – N/A Recommendation – The University should implement procedures to identify duplicate contact and bank information across student accounts automatically or a process to check for duplicates prior to financial aid distribution. Views of Responsible Officials and Planned Corrective Actions – Management agrees with the findings and has put the following in place. The Bursar will work with ITS to perform a scan of all students’ accounts for duplicate contact and banking information. If duplicates are found, students will be notified and accounts frozen until students are identified. This will be critical before refund checks are dispersed to students every semester. The amount of $54,112 will be paid back with the next draw down before February 28, 2025.
Federal Program – Student Financial Assistance Cluster – Assistance Listing Numbers 84.063, 84.007 and 84.268 – U.S. Department of Education Program Year 2023-2024 Criteria or Specific Requirement – 2 CFR 200.516(a), Paragraph 13.39(e) – Known or Likely Fraud Affecting a Federal Award Condition – Financial aid funds were provided to six fraudulent student accounts; the issue was identified by the school and reported to the U.S. Department of Education. Questioned Costs – $54,112 Context – During a review of the awards population for fiscal year 2024, the University identified six accounts that had duplicate contact and bank information. After further investigation, these accounts were determined to be fraudulently created. In total, $54,112 in funds were paid out. The school worked with the U.S. Department of Education’s CyberIncident Division to inform the Department of the fraudulent activity. Effect – The University allowed refunds to be made from financial aid awarded to fraudulent student accounts resulting in questioned costs. Cause – The University had detective rather than preventative controls in place regarding distributions of financial aid funds to repeating accounts or individuals. Identification as a Repeat Finding, if Applicable – N/A Recommendation – The University should implement procedures to identify duplicate contact and bank information across student accounts automatically or a process to check for duplicates prior to financial aid distribution. Views of Responsible Officials and Planned Corrective Actions – Management agrees with the findings and has put the following in place. The Bursar will work with ITS to perform a scan of all students’ accounts for duplicate contact and banking information. If duplicates are found, students will be notified and accounts frozen until students are identified. This will be critical before refund checks are dispersed to students every semester. The amount of $54,112 will be paid back with the next draw down before February 28, 2025.
Criteria: Per federal regulation 2 CFR section 200.516(b)(1), the School District is required to develop and maintain procedures regarding equipment acquired with federal funds. Condition: The School District has not developed procedures to implement its policies with regard to the inventory and safeguarding of equipment purchased with federal funds. Cause: The School District has not completed the adoption of the required policies. Effect: The School District is not in compliance with the equipment management requirements. Recommendation: We recommend that the School District adopt and implement procedures in accordance with its policies to maintain property records on federally acquired equipment consistent with the required components identified in 2 CFR section 200.516; the safeguarding of such equipment; and perform an inventory of such equipment no less than once every two years. Management’s Response: Management agrees with this finding. The school policy committee will create/review policy.
Reference Number: 2024-001 Finding: Finding Type: Immaterial noncompliance with major program requirements Title and CFDA Number of Federal Program: 59.046 – Small Business Administration Microloan Program Finding Resolution Status: In review. Information on Universe and Population Size: Salaries and wages pursuant to approved budget for the period July 1, 2023 to June 30, 2024. Salaries and wages per approved budget is $1,885,028. Sample Size Information: A sample of 20 allocations of salaries and wages allocated to the program during the budget period were selected for testing compliance, including to approved time allocations within the payroll processor and as compared to the Executive Level II Salary max amounts in effect during the budget period. Identification of Repeat Finding and Finding Reference Number: N/A Criteria: The Organization is required to submit an award budget for approval, including direct costs to be allocated to the award. The Organization is then required to submit a schedule of actual allocated costs incurred for reimbursement. Statement of Condition: During our testing of allocated salaries and wages, we identified errors in how employee time was allocated to the program, and salaries and wages allocated to the program in excess of the Executive Level II Salary maximum. Specifically, one employee had salaries and wages allocated to the program in excess of hours tracked to the program for a selected month. Another employee had an inappropriate wage rate applied to allocated time to the program. Last, two employees had compensation levels allocated to the program in excess of the Executive Level II Salary max amount in effect for the respective period. Cause: The Organization did not have adequate procedures in place to ensure that payroll costs were supported by accurate time and rates reporting. Certain allocations were made subsequent to the approved budget amounts, however support was not substantiated for those allocations. Effect or Potential Effect: Salaries and wages charged to the program included unsupported amounts, resulting in projected questioned costs of $63,740. When the actual errors in the sample tested were projected across the population, the potential error exceeds $25,000, which requires reporting under 2 CFR 200.516(a). However, the total projected questioned costs were not material to the program. Auditor Noncompliance Code: A – Activities allowed or unallowed Reporting Views of Responsible Officials: Management agrees with the noncompliance with no sanctions imposed conclusion. Context: No additional context identified by the Organization which is not otherwise presented herein. Recommendation: The Organization should strengthen internal controls over payroll cost allocations, including regular reconciliation of payroll charges to actual time records and rates. Time and rate documentation should be properly reviewed and approved. Auditor’s Summary of the Auditee’s Comments on the Findings and Recommendations: Management should complete regular reconciliations of payroll charges to actual time records and rates. Time and rate documentation should be properly reviewed and approved. Response Indicator: Agree Completion Date: In process. Response: Management acknowledges noncompliance in the current fiscal year and is reviewing its internal controls over payroll cost allocations. Questioned Costs: $63,740
Reference Number: 2024-001 Finding: Finding Type: Immaterial noncompliance with major program requirements Title and CFDA Number of Federal Program: 59.046 – Small Business Administration Microloan Program Finding Resolution Status: In review. Information on Universe and Population Size: Salaries and wages pursuant to approved budget for the period July 1, 2023 to June 30, 2024. Salaries and wages per approved budget is $1,885,028. Sample Size Information: A sample of 20 allocations of salaries and wages allocated to the program during the budget period were selected for testing compliance, including to approved time allocations within the payroll processor and as compared to the Executive Level II Salary max amounts in effect during the budget period. Identification of Repeat Finding and Finding Reference Number: N/A Criteria: The Organization is required to submit an award budget for approval, including direct costs to be allocated to the award. The Organization is then required to submit a schedule of actual allocated costs incurred for reimbursement. Statement of Condition: During our testing of allocated salaries and wages, we identified errors in how employee time was allocated to the program, and salaries and wages allocated to the program in excess of the Executive Level II Salary maximum. Specifically, one employee had salaries and wages allocated to the program in excess of hours tracked to the program for a selected month. Another employee had an inappropriate wage rate applied to allocated time to the program. Last, two employees had compensation levels allocated to the program in excess of the Executive Level II Salary max amount in effect for the respective period. Cause: The Organization did not have adequate procedures in place to ensure that payroll costs were supported by accurate time and rates reporting. Certain allocations were made subsequent to the approved budget amounts, however support was not substantiated for those allocations. Effect or Potential Effect: Salaries and wages charged to the program included unsupported amounts, resulting in projected questioned costs of $63,740. When the actual errors in the sample tested were projected across the population, the potential error exceeds $25,000, which requires reporting under 2 CFR 200.516(a). However, the total projected questioned costs were not material to the program. Auditor Noncompliance Code: A – Activities allowed or unallowed Reporting Views of Responsible Officials: Management agrees with the noncompliance with no sanctions imposed conclusion. Context: No additional context identified by the Organization which is not otherwise presented herein. Recommendation: The Organization should strengthen internal controls over payroll cost allocations, including regular reconciliation of payroll charges to actual time records and rates. Time and rate documentation should be properly reviewed and approved. Auditor’s Summary of the Auditee’s Comments on the Findings and Recommendations: Management should complete regular reconciliations of payroll charges to actual time records and rates. Time and rate documentation should be properly reviewed and approved. Response Indicator: Agree Completion Date: In process. Response: Management acknowledges noncompliance in the current fiscal year and is reviewing its internal controls over payroll cost allocations. Questioned Costs: $63,740
(1) Summary of Auditors’ Results Financial Statements a. Type of report issued on whether the financial statements were prepared in accordance with generally accepted accounting principles: Unmodified b. Internal control deficiencies over financial reporting disclosed by the audit of the financial statements: • Material weaknesses: No • Significant deficiencies: No c. Noncompliance material to the financial statements: No Federal Awards d. Internal control deficiencies over major programs disclosed by the audit: • Material weaknesses: Yes • Significant deficiencies: No e. Type of report issued on compliance for major programs: Qualified f. Audit findings that are required to be reported in accordance with 2 CFR 200.516(a): Yes g. Major programs: • Student Financial Assistance Cluster – Various ALNs h. Dollar threshold used to distinguish between Type A and Type B programs: $750,000 i. Auditee qualified as a low-risk auditee: Yes (2) Findings Relating to the Financial Statements Reported in Accordance with Government Auditing Standards None (3) Findings and Questioned Costs Relating to Federal Awards Finding Number: 2024-001 Program: Student Financial Assistance Cluster ALN #: 84.063 and 84.268 Federal Award #’s: P063P235372, P268K225372 Federal Award Years: July 1, 2023 to June 30, 2024 Federal Agencies: U.S. Department of Education Pass-Through Entity: N/A – Direct Award Compliance Requirement: Enrollment Reporting Finding Type: Material Weakness and Material Noncompliance Criteria: Under the Pell grant and the Direct and Federal Family Education Loan programs, institutions are required to report enrollment information via the National Student Loan Data System (NSLDS) (OMB No. 845-0035). The administration of the Title IV programs depends heavily on the accuracy and timeliness of the enrollment information reported by institutions. Institutions must review, update and verify student enrollment statuses, program information and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Financial Aid Professionals (NSLDSFAP) website. The data on the institution’s Enrollment Reporting Roster, or Enrollment Maintenance page, is what NSLDS has as the most recently certified enrollment information. There are two categories of enrollment information, “Campus Level” and “Program Level,” both of which need to be reported accurately and have separate record types. The NSLDS Enrollment Reporting Guide provides the requirements and guidance for reporting enrollment details using the NSLDS Enrollment Reporting Process. Institutions are responsible for timely reporting, whether they report directly or via a third-party servicer. Institutions must complete and return the Enrollment Reporting roster file placed in their Student Aid Internet Gateway (SAIG) (OMB No. 1845-0002) mailboxes sent by ED via NSLDS within 15 days. An institution determines how often it receives the Enrollment Reporting roster file with the default set at a minimum of every 60 days. Once received, the institution must update for changes in the data elements for the Campus Record and the Program Record identified above, and submit the changes electronically through the batch method, spreadsheet submittal or the NSLDS website. Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition found: During our testwork over student enrollment reporting, we noted Regent did not report all changes to students’ status within the required 60 days. For a sample of 40 students who were recipients of Direct Loans or Pell Grants between July 1, 2023 and June 30, 2024 and that had been identified as having withdrawn, graduated, or modified their enrollment status as defined by Regent’s Satisfactory Academic Progress Policy through a change in course load, the following was noted: For 33 students out of the 40 selected for compliance testing, Regent did not transmit the students’ status change to NSLDS within 60 days. Additionally, based on management’s further investigation, it was determined that there were multiple submissions during the year that were delayed and resulted in enrollment reporting being outside of the 60- day window. Additionally, while Regent has controls in place to ensure that enrollment changes are reported timely to the National Student Clearinghouse (NSC), the control does not ensure that any required correspondence with NSC to resolve data matters is happening timely. Cause: For the students noted above, management communicated that there were delays in the data transmission from the NSC and the NSLDS. While the data was provided to the NSC in a timely manner, there were issues with the data that needed to be resolved between Regent and the NSC in order to proceed with the submission to NSLDS. For the reasons noted above, we determined the related control in place at Regent, which is designed to address the timeliness of the transmission reports, is not designed at a level to verify the timeliness of the data transmission to the NSC nor ensure that any subsequent issues are resolved timely and that the data is ultimately submitted to the NSLDS timely. Proper perspective: Regent’s policy is to submit enrollment data to the NSC on a predetermined schedule that allows Regent to comply with the enrollment reporting requirements. For our sample of 40 students with status changes, we identified 33 students where the status change was not reported within 60 days. Upon further review by management, there were a total of 13 submissions for which the delay in the resolution of issues between Regent and the NSC resulted in the enrollment information being reported outside of the 60-day reporting requirement. As a result of these delays, there were a significant number of changes that were not reporting timely. Possible asserted effect: Untimely submission of student enrollment information affects the determinations that lenders and servicers of students’ loans make related to in-school status, deferments, graces periods, and repayment schedules, as well as the federal government’s payment and interest schedules. Questioned costs: None noted. Statistical sampling: The sample was not intended to be, and was not, a statistically valid sample. Repeat finding: A similar finding was not reported in the prior year. Recommendation: We recommend that Regent implement additional controls to ensure that the transmission reports are received by NSLDS timely. Additionally, we recommend Regent evaluate its processes and procedures when submitting data to the NSC to ensure that any data issues impacting the timeliness of the transmissions are resolved. Views of responsible officials: Regent agrees with this finding. Regent intends to strengthen its controls and quality assurance measures over the timeliness of enrollment information to NSLDS.