Finding Text
50000 – Special Education Activities Allowed & Allowable Costs (Material Weakness in Internal Control Over Compliance, Noncompliance) Federal Agency: U.S. Department of Education Pass-Through Entity: California Department of Education Program Name: Special Education Grants to States - Basic Local Assistance Federal Financial Assistance Listing: 84.027 Award Identification Number: 13379 Award Year: 2024-2025 Compliance Requirements: A. Activities Allowed or Unallowed & B. Allowable Costs/Cost Principles Type of Finding: Material Weakness in Internal Control over Compliance; Noncompliance Criteria Per Title 2, Code of Federal Regulations, Subtitle A, Part 200, Subpart E, Section 200.403(a), in order for costs to be allowable under Federal awards, they must be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Condition The District did not have sufficient controls in place to ensure that expenditures charged to the Special Education program were allowable in accordance with federal requirements. The District transferred expenditures into the federal program from the state special education program. The amount of expenditures transferred into the federal program was $235,962 in excess of the amount of available expenditures in the state program. As such, this amount was not supported by invoices in order to determine allowability. Cause The condition identified appears to have materialized due to the District’s lack of internal controls over compliance. Effect The District has not complied with Title 2, Code of Federal Regulations, Subtitle A, Part 200, Subpart E, Section 200.403(a). Questioned Costs The condition identified above resulted in $235,962 of questioned costs for Special Education Grants to States - Basic Local Assistance under Assistance Listing 84.027 and Award Identification Number 13379. Context/Sampling: Questioned costs were identified through review of one of one large journal transfers noted. It was noted through review of the transfer that the expenditures remaining in the state program were negative due to the over-transfer of $235,962 of expenditures into the federal program. Repeat Finding No. Recommendation The District should implement additional internal controls over compliance with federal programs to ensure that expenditures are made in compliance with all federal regulations and program guidance.