Finding Text
2024-007 Preparation of the Schedule of Expenditures of Federal Awards
Fiscal year finding initially occurred: 2024
CONDITION: The school district lacks an adequate system of internal controls to
properly prepare and reconcile a complete and accurate Schedule of Expenditures
of Federal Award (SEFA) to the underlying financial records.
CRITERIA: The Uniform Guidance, Subpart F, Section 200.510 and Section
200.512, respectively, require the preparation of the Schedule of Expenditures of
Federal Awards (SEFA) to include an accurate reporting of federal awards
expended based on the terms and conditions of the grants received. In order for the
SEFA to be prepared accurately, the school district's internal controls should
include a centralized process for accumulating grant information and tracking the
grant status from inception of the grant award to recording of grant active in the
financial statements.
CAUSE: The school district does not have an adequate system of internal controls
in place to properly accumulate, prepare, and reconcile a SEFA to its financial
records.
EFFECT: Failure to properly implement a system of internal controls to track grant
activity could lead to improper use of grant awards to fund unallowable costs. In
addition, without properly accumulating and tracking grant activities used to
prepare the SEFA, grant awards could be misidentified within the school district's
financial statements and not reported in accordance with Uniform Guidance.
RECOMMENDATION: Management should review the school district's policies
and procedures for monitoring and tracking grant awards from grant application to
recording grant activities in the financial statements.