Finding Text
Subject: Title I Grants to Local Educational Agencies - Eligibility; Matching, Level of Effort, Earmarking Federal Agency: Department of Education Federal Program: Title I Grants to Local Educational Agencies Assistance Listings Number: 84.010 Federal Award Numbers and Years (or Other Identifying Numbers): S010A190014, S010A200014, S010A210014 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Eligibility; Matching, Level of Effort, Earmarking Audit Finding: Material Weakness Condition and Context An effective internal control system was not designed nor implemented at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Eligibility and the Matching, Level of Effort, Earmarking compliance requirements. INDIANA STATE BOARD OF ACCOUNTS 19 EAST NOBLE SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Eligibility Eligibility for the program was determined on the Eligible School Summary of the Title I application. The Indiana Department of Education prepopulated the School Corporation's enrollment and poverty numbers based upon Real Time Data (RT) reports that were updated by the School Corporation and the Pupil Enrollment Summary Report. Data in the RT reports originated from the Applications for Free and Reduced Priced Meals. At the beginning of each year, an individual entered the poverty guidelines into the software the School Corporation used to determine eligibility. The same individual who entered the parameters also performed the final authorization of the system's determination, automatically sending the information into the database that populated the RT reports. Matching, Level of Effort, Earmarking There was no oversight or review process at the School Corporation level over the methodology of allocating funds to the individual schools within the School Corporation to ensure that it was consistently applied throughout the audit period. The lack of internal controls was a systemic issue throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) 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 be in compliance 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). . . ." Cause Management had not designed nor implemented a system of internal controls that would have ensured compliance with the grant agreement and the Eligibility and the Matching, Level of Effort, Earmarking compliance requirements. Effect The failure to design and implement an effective internal control system could have enabled noncompliance with the grant agreement and the Eligibility and the Matching, Level of Effort, Earmarking compliance requirements. Questioned Costs There were no questioned costs identified. INDIANA STATE BOARD OF ACCOUNTS 20 EAST NOBLE SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Recommendation We recommended that the School Corporation's management establish a system of internal controls to ensure compliance with the grant agreement and the Eligibility and the Matching, Level of Effort, Earmarking compliance requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.