Finding Text
FINDING # 2023-001
U.S. Department of Education – Passed-through the NYS Education Department
COVID-19 - American Rescue Plan - Elementary and Secondary School Emergency Relief (ARP ESSER) Fund; Assistance Listing Number 84.425U; Project #5880-21-1565; Grant Period – Fiscal Year Ended June 30, 2023
Significant Deficiency, Other Non-Compliance
Compliance Requirement: Equipment and Real Property Management
Criteria: According to 2 CFR section 200.313(d)(1), detailed property records must be maintained for equipment acquired under a federal grant award. Records should include a description of the property, a serial number or identification number, the source of funding (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and ultimate disposition data.
Condition: During our audit, we noted the District’s capital asset records for some of the assets acquired with federal grant funding during the fiscal year were added to the District’s capital asset records and capitalized for the incorrect amounts. In addition, we noted that the District’s current practices surrounding the inventorying and capitalization of capital assets does not appear to align with the associated Board of Education policy on capital assets.
Cause: The District did not fully reconcile its expenditure records when capitalizing equipment additions purchased with federal funds.
Effect: If the District’s capital asset records are incomplete or inaccurate, they may not be properly safeguarded, and the District may not comply with the aforementioned federal regulations.
Questioned Costs: None.
Recommendation: We recommend that the District implement a system of communication and a review process surrounding capital asset additions to ensure the completeness and accuracy of capital asset records. In addition, we recommend the District update their capital asset Board of Education policy to expand on the capitalization of like-kind capital assets in order to properly align with their current practices.
District’s Response: The District’s response is included in their corrective plan.