Finding Text
Finding No. 2022-008
Federal Agency: U.S. Department of Education
Assistance Listing No. and Title: 84.027 Special Education – Grants to States (IDEA, Part B)
Area: Equipment and Real Property Management
Questioned Costs: $29,988
Criteria:
§ 2 CFR 200.313(b) provides that a state must use, manage and dispose of equipment acquired under a Federal award by the state in accordance with state laws and procedures.
PSS Rules and Regulations § T60-20-815 Inventory Requirements Section (c)(1) provides that a fixed asset at its inception shall be assigned to one individual, who will be responsible for the care and maintenance of the specified fixed asset. The employee, who is in direct control of the fixed asset (not the supervisor of the employee), and who is using the fixed asset, shall sign for the fixed asset.
§ T60-20-815 Section (c)(5) provides that the Procurement and Supply Department and the Fiscal and Budget Division along with the responsible school principals, program managers and site coordinators shall be responsible for taking an inventory of all fixed assets. During that inventory, all custodians must be matched with the appropriate records of assigned fixed assets maintained at the Central Office. All discrepancies between custodians and their respective fixed assets must be cleared by 90 days after the closing of the fiscal year.
Further, § T60-20-815 Section (e) provides that the disposition of fixed assets shall be in accordance with procedures established by the Commissioner.
Condition:
Of 5 equipment transactions tested, aggregating $29,988 of $59,723 in total amount of equipment identified under the program as of September 30, 2022:
1. For 5 (or 100%), no evidence of custodian signature at inception of the fixed asset was provided. However, printed copies of the property master information record from the JD Edwards system were signed and dated by the custodian and a verifier as evidence of the most recent physical inspection in September 2022.
See Schedule of Findings and Questioned Costs for chart/table.
Condition, continued:
2. For 2 (or 40%), the custodian’s name and the condition of the equipment was not indicated on the property master information record for PS-012478-US and PS-047509-US, with a total amount tested of $4,872. Evidence that custodian records were matched and updated after physical inspection was not obtained.
Cause:
PSS’ existing fixed asset management policies are insufficient to ensure proper management of equipment and real property.
Effect:
PSS is in noncompliance with applicable equipment and real property requirements. The reportable questioned cost is $29,988.
Recommendation:
PSS should improve its existing fixed asset management policies to align with the Federal requirements on equipment and real property management. The Office of Procurement and Supply should consider developing standard forms and templates that can be used to document compliance with recordkeeping, custodianship, and physical count policies.
Views of responsible officials:
PSS agrees with the finding and describes corrective actions in the PSS Corrective Action Plan.