Finding Text
Information on the federal program:
Subject: Special Education Cluster – Internal Controls
Federal Agency: Department of Education
Federal Program: Special Education Cluster
Assistance Listing Number: 84.027
Federal Award Numbers and Years (or Other Identifying Numbers): 22611-122-PN01
Pass-Through Entity: Indiana Department of Education
Compliance Requirement: Level of Effort - Maintenance of Effort
Audit Finding: Material Weakness
Criteria: 2 CFR section 200.303 states in part:
"The non-Federal entity must:
(a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ."
Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Level of Effort - Maintenance of Effort compliance requirement.
Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with the compliance requirement listed above.
Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs.
Questioned Costs: There were no questioned costs identified.
Context: The School Corporation was required to submit one workbook covering FY21 and FY22 to the Indiana Department of Education (IDOE) during the audit period to meet federal the Level of Effort - Maintenance of Effort requirements. We noted the amounts reported covering the FY21 time period ($865,515) did not agree to the underlying expenditure records ($1,474,349 for the period of July 1, 2020 through June 30, 2021). Additionally, we noted the amounts reported covering the FY22 time period ($937,948) did not agree to the underlying expenditure records ($2,695,619, for the period of July 1, 2021 through June 30, 2022).
Identification as a repeat finding: No.
Recommendation: We recommend someone other than the preparer of the report perform a documented review prior to submission to validate the accuracy and completeness of the data submitted. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.