Finding 1062430 (2023-002)

Material Weakness Repeat Finding
Requirement
F
Questioned Costs
-
Year
2023
Accepted
2024-09-06

AI Summary

  • Core Issue: Aurora Charter School failed to obtain necessary approvals for equipment purchases using federal funds, leading to material noncompliance.
  • Impacted Requirements: Compliance with 2 CFR § 200.313 (c)(1) and (d)(1) regarding federal equipment and real property management was not met.
  • Recommended Follow-Up: The School should enhance internal controls and revise its capitalization threshold to ensure future compliance with federal requirements.

Finding Text

MATERIAL WEAKNESS IN INTERNAL CONTROL OVER COMPLIANCE AND MATERIAL NONCOMPLIANCE – U.S. DEPARTMENT OF EDUCATION – PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, COVID-19 – EDUCATION STABILIZATION FUND, FEDERAL ALN 84.425 2023-002 Internal Control Over Compliance and Material Noncompliance With Equipment and Real Property Management Requirements Criteria – 2 CFR § 200.313 (c)(1) and (d)(1) requires that Aurora Charter School (the School) obtain approval from the federal funding agency or pass-through agency prior to the purchase of equipment with federal funding. Condition – During our audit, we noted the School did not have sufficient controls in place within the Education Stabilization Fund federal program to assure compliance with federal equipment and real property management requirements, resulting in material noncompliance. Questioned Costs – None. Context – The School did not obtain approval from the federal funding agency or pass through agency prior to purchasing equipment with a total value of $44,005 using federal funds. Repeat Finding – This is a current year and prior year finding. Cause – This condition was due to a misunderstanding of the individual item value for which federally funded equipment purchases were required to be preapproved and tracked. Effect – Noncompliance with the equipment and real property management could be viewed as a violation of the award agreement and result in loss of funds. Recommendation – We recommend that the School review its internal control procedures to ensure future compliance with the federal compliance requirements specific to equipment and real property management for the COVID-19 – Education Stabilization Fund federal program. View of Responsible Official and Planned Corrective Actions – The School agrees with the finding. The School intends to revise its internal capitalization threshold to align with the federal threshold, and to review its other control procedures relating to equipment and real property management requirements to ensure compliance for future federal awards expenditures. The School has separately issued a Corrective Action Plan related to this finding.

Categories

Equipment & Real Property Management Procurement, Suspension & Debarment Material Weakness

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
84.425 Education Stabilization Fund $831,859
84.371 Comprehensive Literacy Development $507,980
84.010 Title I Grants to Local Educational Agencies $227,682
10.555 National School Lunch Program $224,284
84.365 English Language Acquisition State Grants $49,020
10.553 School Breakfast Program $48,112
93.323 Epidemiology and Laboratory Capacity for Infectious Diseases (elc) $20,000
84.027 Special Education_grants to States $15,000
84.173 Special Education_preschool Grants $6,124
21.027 Coronavirus State and Local Fiscal Recovery Funds $6,000
10.649 Pandemic Ebt Administrative Costs $628
10.559 Summer Food Service Program for Children $23