Finding Text
3. Physical Inventories
Finding Number: 2023-008
Assistance Listing Number and Title: AL # 84.425 Education Stabilization Fund
Federal Award Identification Number / Year: 2022/2023
Federal Agency: U.S. Department of Education
Compliance Requirement: Equipment And Real Property Management
Pass-Through Entity: Ohio Department of Education and Workforce
Repeat Finding from Prior Audit? No
Noncompliance and Material Weakness
2 C.F.R. § 3474.1 gives regulatory effect to the Department of Education for 2 C.F.R. §200.313(d)(2), which states, a physical inventory of the property must be taken and the results reconciled with the property records at least once every 2 years.
Due to a failure of internal controls, there was no indication that a physical inventory of the property acquired under the Elementary and Secondary School Emergency Relief (ESSER II, AL number 84.425D) and American Rescue Plan Elementary and Secondary School Emergency Relief (ARP ESSER), AL number 84.425U) had been performed within the preceding two years. Further, the District did not maintain a listing of capital assets purchased using this grant fund.
Physical inventories should be performed, at a minimum, once every two years to verify that assets held per the capital asset listing actually exist. This will help detect errors, fraud, theft, or omissions.