Finding Text
Compliance Requirement F. Equipment and Real Property Finding Type Significant Deficiency in Internal Control Over Compliance and Compliance Finding Federal Agency U.S. Department of Health and Human Services Federal Program Title Administration for Children & Families - Head Start Assistance Listing Number 93.600 Criteria: 2 CFR 200.313(e) requires (e) when equipment acquired under a federal award is no longer needed for the original project, program, or for other activities currently or previously supported by a federal agency, the recipient or subrecipient must request disposition instructions from the Federal agency or pass-through entity if required by the terms and conditions of the Federal award. Condition: During the year ended June 30, 2025, the client moved several Head Start program classrooms to new locations. Tangible equipment purchased with federal program funds was abandoned and left at the former classroom location. This equipment was not sold. The Organization did not request formal disposition instruction from the federal awarding agency. Cause: Lack of formal policies and training regarding disposition of equipment acquired using federal grant funds. Effect: Failure to take appropriate disposition actions may result in the Federal agency to direct the recipient to take appropriate disposition actions. Questioned Costs: None Identification as a Repeat Finding: N/A - this was not reported as a finding in the prior audit report. Recommendation: We recommend that the Organization implement and document a formal process in connection with disposition of equipment to be in compliance with federal requirements. View of Responsible Officials: The Organization agrees with this audit finding.