Finding 1080744 (2024-002)

Finding 2024-002 – ACTIVITIES ALLOWED OR UNALLOWED and ALLOWABLE COSTS/COST PRINCIPLES Type: Significant Deficiency in Internal Control / Noncompliance Program: Title I (ALN 84.010) Condition: Expenditures charged to the grant were over amounts authorized in the grant budget. Criteria: As detailed by 2 CFR 200.402, “the total cost of a Federal award is the sum of the allowable direct and allocable indirect costs less any applicable credits”. Cause: Grant budget was not amended for increases in planned expenditures. Effect: Unallowed costs were charged to the grant based on / compared to MDE approved budgets. Consequently, reimbursements (funding sources) may be overstated. Context: Amounts expended for this grant by function code and/or object code were over the amounts allowed in the MDE approved budget. Recommendation: We recommend that the District review all grant agreements to gain a thorough understanding of allowable costs and then establish internal controls to assure that only allowable costs are charged to the grant. Management’s Resp: Management is in agreement with this recommendation.