Finding Text
Federal Agency: U.S. Department of Education Federal Program Name: Title I Grants to Educational Agencies Assistance Listing Number: 84.010 Federal Award Identification Number and Year: S010A240049 Pass-Through Agency: Wisconsin Department of Public Instruction Pass-Through Number(s): 2025-105726-DPI-TI-A-141 Award Period: July 1, 2024 – June 30, 2025 Type of Finding: Material Weakness in Internal Control over Compliance Criteria or Specific Requirement: 2 CFR 200.303 requires grantees to establish, document, and maintain effective internal control over federal awards that provides reasonable assurance that the grantee is managing the federal in compliance with federal statutes, regulations, and the terms and conditions of federal award. This includes implementing controls for verifying only allowable costs are recorded and eligibility determinations are properly documented and reviewed by someone other than the preparer. Segregation of duties is an internal control intended to prevent or decrease the occurrence of errors or intentional fraud. Segregation of duties ensures that no single employee has control over all phases of a transaction. Condition: There is no formal, documented review and approval by any District employee to ensure the activity and cost is allowable under the grant. There is also no formal documented review and approval of the eligibility forms filed in Wisegrants. Accordingly, this does not allow for a proper segregation of duties for internal control purposes. Questioned Costs: None. Context: When identifying internal controls over compliance related to allowable costs, it was noted that the Bookkeeper or District Office Manager position handled all the responsibilities of those functions related to Title I and there were no formal, documented internal controls over compliance in place to review that costs met all requirements and were properly documented. There was no review of the work completed by someone other than the preparer. While the District met with CESA 10 to review the eligibility reports, there was no formal review or approval of the reports submitted in Wisegrants. Cause: The lack of segregation of duties is due to the limited number of employees and the size of the District’s operations. Effect: Errors or intentional fraud could occur and not be detected timely by other employees in the normal course of their responsibilities as a result of the lack of segregation of duties. Unallowable costs could be recorded for the grant resulting in noncompliance. Eligibility determinations could be incorrect, resulting in noncompliance. Repeat Finding: No. Recommendation: We recommend the District review its grant disbursement process to ensure that there is adequate segregation of duties in regards to initiating, authorizing, reviewing for grant allowability and approving purchases, along with adding controls to ensure that the item purchased was received by the District. We also recommend the District printout the eligibility reports from Wisegrants and sign and date them to indicate review and approval after meeting with CESA 10 each year. Views of Responsible Officials: There is no disagreement with the audit finding.