Finding Text
2024-005 CASH MANAGEMENT - SIGNIFICANT DEFICIENCY
Federal Program
Student Financial Assistance Cluster (ALN 84.007, 84.033, 84.063, and 84.268)
Criteria
The Code of Federal Regulations, 2 CFR 200.303, non-Federal entities receiving Federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations and program compliance requirements.
Condition
Evidence of approval to drawdown funds from the G5 system were not located by management.
Cause
Turnover within the accounting office and lack of proper oversight from management led to the lack of evidence to support the timing of drawdowns reported to be located and provided to the auditor.
Effect
The College’s lack of evidence to support drawdowns did not allow the auditor to test the cash management internal control over compliance requirement for the College.
Questioned Costs
None.
Context
There was significant turnover within the accounting office during the 2024 and 2023 fiscal year. The current staff was unable to locate the approval to draw funds from the grant website. It was noted and reviewed that the financial aid staff is performing a reconciliation of loans and awards issued to the applicable federal database.
Repeat Finding
Yes. 2023-007.
Recommendation
The College should revisit its internal control procedures to ensure that direct and material compliance requirements are being followed. This would include controls implemented to ensure processes are followed and assign accountability for completion. It is important to include a segregation of duties for the drawdown of grant funding and the reporting of the transaction. These procedures should be documented to allow new employees an understanding of the grant requirements and how they are fulfilled.
Management Response
See corrective action plan included in this report package.