Finding Text
2022-007 Federal Agency: U.S. Department of Education Pass Thru Entity: Oklahoma State Department of Education Program: COVID-19 Education Stabilization Fund Assistance Listing: COVID-19- 84.425D & 84.425U Grant Period: Year ending June 30, 2022 Condition: Allowable costs/cost principles of indirect costs was overclaimed. Criteria: 34 CFR 76.569a Indirect costs= (restricted indirect cost rate) x (total direct costs of the grant minus capital outlays, subgrants, and other distorting or unallowable items as specified in the grantee?s indirect cost rate agreement). Cause: Failure to properly exclude construction activities from direct costs before the indirect costs were claimed. Effect: Indirect costs reimbursements were in excess of allowable amounts and may have to be returned. Context: Total expenditures, net of indirect cost and equipment capital expenditures, claimed were $23,578,870. Total construction capital expenditures claimed in this total were $2,341,866. The approved indirect cost rate was 2.74%. Total claimed indirect costs were $630,897. After excluding construction capital expenditures, overclaimed indirect cost found not to be in compliance was $49,003. Questioned Costs: $49,003 Repeat Finding from Prior Year: Yes; 2021-005 Recommendation Indirect costs should be claimed in accordance with allowable cost principles. Construction capital expenditures should be excluded from costs included in indirect cost claims. Views of Responsible Officials And Planned Corrective Action: Lawton Public Schools utilized the Oklahoma State Department of Education?s guidance and charged indirect costs for ?capital expenditures? and received reimbursement for those direct costs. The auditor has identified $49,003 as unallowable. Lawton Public Schools will reimburse the State Department of Education for the total of these unallowable costs regardless of SDE?s guidance stating otherwise.