Finding Text
Federal Agency: U.S. Department of Treasury
Award Name: Coronavirus State and Local Fiscal Recovery Funds
Program Year: 2023
Assistance Listing Number: 21.027
Compliance: Activities Allowed and Unallowed and Allowable Costs/Costs Principles
Finding Type: Material weakness in internal controls over compliance.Criteria: Management is responsible for maintaining its accounting records in accordance with generally
accepted accounting principles (GAAP).
Condition: During compliance testing, it was noted that expenditures were recorded in the incorrect
period.
Context: There were 17 transactions noted from 2022 that were included in the 2023 Schedule of
Expenditures of Federal Awards. The 17 transactions totaled approximately $165,000 which had
previously been included in the 2022 audited SEFA. The costs were appropriately not included in final
reporting to the State.
Cause of condition: Accrued expenditures from 2022 were not identified when preparing the 2023
Schedule of Expenditures of Federal Awards.
Effect of Condition: As a result of this condition, the District had internal controls over compliance issues
and the 2023 SEFA were initially misstated by amounts that were material to the financial statements.
Recommendation: It is recommended that the District establish additional policies and procedures to
ensure that all Federal awards are identified and reported accurately on the SEFA and are recorded in
the correct period. There should be additional review after the preparation of the SEFA.
View of Responsible Officials and Planned Corrective Action: The SEFA was modified several times as a
result of receiving vendor invoices up to May, 2024 for work completed in the audit period. In
addition, vendors refunded make-ready costs which had been invoiced to a closed grant. We sought
guidance from the grantor regarding proper accounting treatment of those refunds and, receiving
none, recognized those refunds as revenue to be tracked against grant expenses.
Corrective action includes approving invoices through the audit period and submitting the SEFA based
on this information.
Planned Implementation Date of Corrective Action: Ongoing
Person Responsible for Corrective Action: Jennille Smith, Executive Director.