Finding Text
U.S. DEPARTMENT OF EDUCATION PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION TITLE I - GRANTS TO LOCAL EDUCATIONAL AGENCIES - AL NUMBER 84.010A PASS-THROUGH NUMBER 5440 AUDIT PERIOD - YEAR ENDED JUNE 30, 2025 Allowable Costs/Cost Principles Criteria or specific requirement: Office of Management and Budget (OMB) 2 CFR part 200, subpart E – Cost Principles, establishes principles and standards for determining allowable costs incurred by the School under federal awards. Such costs are to be necessary and reasonable for the performance of the federal award and adequately documented. Condition: During our examination of Title I payroll expenditures, we identified $68,662 in salary and fringe benefits paid to Non-Title I employees. A similar finding was issued in the prior year audit. Cause: Lack of internal controls and management oversight over program expenditures. Effect or potential effect: Unallowable costs of $68,662 were paid from Title I. Questioned costs: $68,662. Context: An examination of Title I payroll expenditures for 6 employees totaling $173,575 from a population of 44 employees totaling $1,378,919. Our sample was not a statistically valid sample. Identification as a repeat finding: Yes Recommendation: The Charter School should contact the Arkansas Division of Elementary and Secondary Education (DESE) for guidance regarding this matter and implement proper controls over program expenditures. Views of responsible officials: The School has contacted DESE for guidance regarding this matter and has implemented proper controls over Title I program expenditures.