Finding 1165310 (2025-003)

Material Weakness Repeat Finding
Requirement
AB
Questioned Costs
-
Year
2025
Accepted
2025-12-18
Audit: 375895
Organization: Chatham School District (AK)

AI Summary

  • Core Issue: Significant deficiency in internal controls over compliance, specifically related to credit card transactions.
  • Impacted Requirements: Internal control procedures must prevent financial misstatements and unauthorized transactions.
  • Recommended Follow-Up: Ensure adherence to internal control policies for credit card transactions to avoid future issues.

Finding Text

Federal Agencies: U.S. Department of Education Federal Programs: “Southeast Alaska Full Service Community Schools”: Association of Alaska School Boards ALN: 84.215J Award Numbers: S215J220051 Award Years: 2023 Type of Finding: Significant deficiency in internal control over compliance and noncompliance. CHATHAM SCHOOL DISTRICT Federal Schedule of Findings and Questioned Costs, Continued Criteria: Internal control procedures should be in place to ensure that proper controls are in place to prevent financial misstatements due to either fraud or error. Condition and Context: During our tests of transactions for internal controls over compliance and compliance we identified one transaction with no purchase order or approval. There was also no authorization for this transaction to be coded to the grant. Cause: Lack of internal control over credit card transactions. Effect: Lack of internal controls over credit cards could result in expenditures being miscoded to the program or allow improper or unauthorized transactions to not be prevented, detected, or corrected in a timely manner. Questioned Costs: Questioned costs are under the reporting threshold of $25,000. Repeat Finding: Yes. Recommendation: We recommend the District adhere to their internal control policies to ensure accurate controls over credit card transactions. Managements Response: Management agrees with this finding. See Corrective Action Plan.

Corrective Action Plan

The District will stregthen controls to ensure all expenditures charged to federal programs are allowable, properly documented, and comply with the Uniform Guidance (2 CFR Part 200). 1. Policy and Procedure development: Written procedures will be implemented defining allowable costs, budget approval processes, and documentation requirements for federal programs. 2. Pre-approval and Documentation: All expenditures charged to federal awards must receive prior approval from the Program Director and Business Manager, accompanied by invoices, purchase orders, and justification forms referencing the applicable federal cost principle. 3. Monthly Monitoring: The Business Manager will review program expenditures monthly for compliance with allowable cost principles and promptly correct any mischarges. 4. Training: Federal program staff and members of the CSG grants Committee will receive annual training on allowable costs, cost allocation, and time-and effort reporting.

Categories

Procurement, Suspension & Debarment Reporting Significant Deficiency Internal Control / Segregation of Duties

Programs in Audit

ALN Program Name Expenditures
84.215 INNOVATIVE APPROACHES TO LITERACY; PROMISE NEIGHBORHOODS; FULL-SERVICE COMMUNITY SCHOOLS; AND CONGRESSIONALLY DIRECTED SPENDING FOR ELEMENTARY AND SECONDARY EDUCATION COMMUNITY PROJECTS $609,933
84.101 CAREER AND TECHNICAL EDUCATION - GRANTS TO NATIVE AMERICANS AND ALASKA NATIVES $499,471
84.299 INDIAN EDUCATION -- SPECIAL PROGRAMS FOR INDIAN CHILDREN $462,281
84.041 IMPACT AID $180,693
10.575 FARM TO SCHOOL GRANT PROGRAM $66,767
84.425 EDUCATION STABILIZATION FUND $62,436
84.010 TITLE I GRANTS TO LOCAL EDUCATIONAL AGENCIES $49,868
84.027 SPECIAL EDUCATION GRANTS TO STATES $47,689
84.424 STUDENT SUPPORT AND ACADEMIC ENRICHMENT PROGRAM $34,153
10.555 NATIONAL SCHOOL LUNCH PROGRAM $28,364
84.371 COMPREHENSIVE LITERACY DEVELOPMENT $16,916
84.048 CAREER AND TECHNICAL EDUCATION -- BASIC GRANTS TO STATES $15,067
84.060 INDIAN EDUCATION GRANTS TO LOCAL EDUCATIONAL AGENCIES $11,989
84.367 SUPPORTING EFFECTIVE INSTRUCTION STATE GRANTS (FORMERLY IMPROVING TEACHER QUALITY STATE GRANTS) $9,514
10.665 SCHOOLS AND ROADS - GRANTS TO STATES $6,132
10.553 SCHOOL BREAKFAST PROGRAM $4,701
93.243 SUBSTANCE ABUSE AND MENTAL HEALTH SERVICES PROJECTS OF REGIONAL AND NATIONAL SIGNIFICANCE $2,708
84.173 SPECIAL EDUCATION PRESCHOOL GRANTS $1,939
10.582 FRESH FRUIT AND VEGETABLE PROGRAM $480
84.196 EDUCATION FOR HOMELESS CHILDREN AND YOUTH $437