Finding Text
2022-003 — Single Audit Report Submission – Material Weakness in Internal Control Over Compliance and Noncompliance (Repeat of finding 2021-004)
Federal program information:
Funding agency: Department of Interior and Department of Education
Passed through the Bureau of Indian Education (BIE)
Title: Indian School Equalization Program (ISEP)
Education Stabilization Fund (ESF)
CFDA number: 15.042 and 84.425
Award number: All major program award numbers
Award period: All major program periods
Criteria: The Uniform Guidance 2 CFR 200.512(a) requires the audit package and data collection form be submitted 30 days after receipt of the auditor’s report or 9 months after the end of the fiscal year, whichever comes first.
Condition: The School’s fiscal year 2022 single audit reporting package was not submitted within nine months after the end of the audit period.
Questioned Costs: N/A
Cause: The School did not have appropriate internal control policies and procedures in place to ensure accounting records and financial statements were reconciled timely and the audit conducted to meet compliance requirements.
Effect: The single audit reporting package was submitted after the required reporting time period.
Auditor’s Recommendations: To ensure compliance with the Uniform Guidance, the School should prepare accurate, complete, and timely financial statements and ensure an audit is performed to ensure the timely submission of the single audit reporting package.
Management’s Response: Management does not dispute these findings, however the reason for this goes well beyond the cause noted by the auditors. In March of 2019, it was discovered that the business manager (now former business manager) had not initiated single audits for FY 2016, 2017, 2018, or 2019. The Board terminated that employee. Current administration and management have been feverishly trying to not only catch up on multiple years’ worth of outstanding audits, but to also rectify myriad problems with existing policy, procedures, record keeping, and accounting mechanisms in cooperation with the Indian Board of Education. The School was without a business manager at all for several months, had one individual who resigned after only a year, and are currently utilizing the expertise of consultants to maintain operations. Nearly everything that is business office-related has been completely overhauled at the School since 2019, as we continue to attempt to become current with outstanding single audits. The School is determined to find solid ground and to meet compliance requirements.