Finding Text
Finding Number: 2024-002
Federal Program: Education Stabilization Fund: COVID-19 – ARP ESSER
Federal Award Identification Number and Year: N/A, 2023 and 2024
Assistance Listing Number (ALN): 84.425U
Federal Awarding Agency: U.S. Department of Education
Compliance Requirement: Allowable Activities, Allowable Costs/Cost Principles
Pass-through Entity: Ohio Department of Education and Workforce
Repeat Finding: No
Significant Deficiency and Noncompliance
Criteria: Federal regulation (2 CFR 200.303(a)) requires that non-federal entities must establish and
maintain effective internal controls 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 School had unallowable activities and unallowable costs charged to the grant
related to sales tax, of which the School is tax exempt.
Questioned Costs: Total of $18,753.
Identification of How Questioned Costs Were Computed: Total known questioned costs of
$4,332, and total projection of $14,421 for a total of $18,753.
Context: In testing ARP ESSER nonpayroll costs, it was noted that the School charged a vendor
quote to the grant, which included sales tax of $3,834, instead of charging the actual invoice
amount paid to the vendor. For another testing selection, there was also an additional $498 of
sales tax charged to the grant.
Cause and Effect: The School did not have internal controls in place to ensure that only
allowable costs are charged to federal grants. As a result, the School charged unallowable
expenses to the grant.
Recommendation: We recommend the School review the federal award allowable uses and
implement a process to ensure that costs are allowable prior to payment. Failure to comply with the
federal award allowable uses could lead to noncompliance and future questioned costs.
Views of Responsible Officials: See the Corrective Action Plan.