Finding 1100978 (2024-001)

Finding Number: 2024‐001 Repeat Finding: No Program Name/Assistance Listing Title: Education Stabilization Fund Assistance Listing Number: 84.425 Federal Agency: U.S. Department of Education Federal Award Number: S425U210038 Pass‐Through Agency: Arizona Department of Education Questioned Costs: N/A Type of Finding: Noncompliance, Significant Deficiency Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Criteria In accordance with 2 CFR Part 200.303, the District is responsible for the establishing and maintaining effective internal control over the Federal award that provides 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 The District’s internal approval queue in the ERP system to ensure expenditures are allowable under a federal grant was not always followed. Cause Proper approval protocols over a purchase were not adhered to during the requisition process. A District employee expedited quick approval without following standard procedures, bypassing the approver who reviews allowable costs related to federal programs. Effect A $28,570 expenditure was not reviewed or approved by an appropriate person familiar with the ESSER grant for allowability and reasonability prior to purchase. The expenditure was ultimately determined to be allowable under the federal grant. Context For one of 50 disbursements reviewed, the purchase order was not approved by the appropriate authorized District personnel prior to issuance. The sample was not intended to be, and was not a statistically valid sample. Recommendation The District should review the expenditure approval queue and ensure it is followed for all federal purchases. Additional training should be provided to ensure employees follow established procedures. The District should also consider eliminating expedited approval processes to ensure all purchases are reviewed prior to purchase. Views of Responsible Officials See Corrective Action Plan.