Finding Text
Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster Assistance Listing Number: 84.173 Federal Award Identification Number and Year: H173A240089 and 2024 Pass-Through Agency: Maryland State Department of Education Pass-Through Numbers: 25033401 Award Period: July 1, 2024 – September 30, 2026 Compliance Requirement: Period of Performance Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or Specific Requirement: Uniform Guidance (2 CFR §200.403 and §200.309) requires that costs charged to a federal award be incurred during the approved period of performance and be allowable, allocable, and reasonable for the federal program. Costs incurred before the start date of the award period are not allowable unless specifically authorized by the federal awarding or pass-through agency. Condition/Context: During testing of expenditures charged to the Special Education Cluster, it was noted that one of three transactions tested were incurred and charged to the federal program prior to the beginning of the approved period of performance. Questioned Costs: $4,157.27 Cause: The Board did not have sufficient internal controls in place to ensure that expenditures charged to federal awards were reviewed for period-of-performance allowability prior to posting and payment. Effect: Charging expenditures incurred outside the approved period of performance increases the risk of unallowable costs, potential repayment to the pass-through or federal awarding agency, and noncompliance with Uniform Guidance requirements. Repeat Finding: No Recommendation: We recommend that the Board strengthen internal controls over federal grant expenditure by implementing procedures to ensure costs are incurred within the approved period of performance prior to being charged to federal awards. This should include enhanced supervisory review, system controls where feasible, and training for staff responsible for grant accounting and compliance. Views of Responsible Officials: The Board concurs with the finding.