Finding 1201231 (2025-004)

Prior Year Finding: No Federal Agency: Department of Education Federal Program: English Language Acquisition State Grants City Department: Boston Public Schools (BPS) Assistance Listing Number: 84.365 Federal Award Number and Year: S365A220021 (7/1/2022) S365A230021 (7/1/2023) S365A240021 (7/1/2024) Pass-through Agency: Massachusetts Department of Elementary and Secondary Education Pass-through Identifying Number and Year: 180-719236-2023-0035 (10/4/2022-9/30/2024) 180-000547-2024-0035 (9/12/2023-9/30/2025) 180-000547-2025-0035 (9/13/2024-9/30/2026) Compliance Requirement: Allowable Costs/Cost Principles – Time and Effort Reporting Type of Finding: Material Weakness in Internal Control Over Compliance, Material Noncompliance Criteria or specific requirement: Compliance: 2 CFR Section 200.430 (8)(i) Standards for Documentation of Personnel Expenses states that: Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: i. Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; ii. Be incorporated into the official records of the non-Federal entity; iii. Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; iv. Encompass both federally assisted, and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity's written policy; v. Comply with the established accounting policies and practices of the non-Federal entity; vi. Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: BPS did not have evidence of time and effort certifications. Context: For eight of forty transactions tested, no documentation related to time and effort certifications was maintained by BPS. Cause: BPS controls were not sufficient to ensure that time and effort reporting was performed and documented, in accordance with federal requirements. Effect: There is an increased risk of charging unallowed costs to the program. Questioned costs: $21,174 Recommendation: We recommend BPS should enhance procedures, implement proper controls, and perform additional training over time and effort reporting. BPS should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program. Documentation should be readily available for audit. Views of responsible officials: Management agrees with the finding.