Finding Text
2023-3 – Equipment and Real Property Management Education Stabilization Fund - AL #84.425 U.S. Department of Education Pass-Through Entity - Pennsylvania Department of Education Criteria: In accordance with 2 CFR part 200.439, capital expenditures for equipment with a per-unit cost of $5,000 are allowable as direct costs, but only with the prior written approval of the Federal agency or pass-through entity. Additionally, 2 CFR section 200.313(d)(1) requires that property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property, who holds title, the acquisition date, cost of the property. Condition: During our testing, we noted that the District acquired four individual pieces of equipment over the $5,000 threshold to be used in the STEAM/CNC Lab without receiving prior approval from the Pennsylvania Department of Education. Additionally, we noted one instance of the District not including all required information on their property records. Cause: The prior approval process of ARP ESSER Funds occurred during the grant application process; however, the specific equipment needs for the STEAM/CNC Lab were not identified at that time. Due to an oversight by the District, at the time of purchase, they did not consider the need to request prior approval from the Pennsylvania Department of Education. Effect: Internal controls are not functioning as designed, and the District is not in compliance with the equipment and real property management requirements of the program. Questioned Costs: None Recommendation: We recommend that the District implement procedures to ensure prior written approval is obtained for applicable equipment purchases funded by federal grants and that fixed asset records include all required information in accordance with Uniform Guidance. The District should also provide appropriate training to personnel involved in grant purchasing and asset management to ensure ongoing compliance. Views of Responsible Officials: Management is in agreement with the finding.