Finding Text
ALN Number, Federal Agency, and Program Name - COVID-19 Education Stabilization Fund - Higher Education Emergency Relief Fund - ALN 84.425F, ALN 84.425M Finding Type - Significant deficiency and material noncompliance with laws and regulations Repeat Finding - No Criteria - The College must minimize the elapsed time between the transfer of funds from the United States Treasury to the College and the disbursement of those funds, as outlined in CFR Section 200.305(b). In addition, CARES Act 18004(e) and CRRSA 314(e) require institutions receiving funds under HEERF I and HEERF Il submit a report to the secretary at such time and in such a manner as the secretary may require. ARP Act 2003 specifies that the same terms and conditions of CRRSA 314 apply to HEERF Ill funds. While the acts do not explicitly identity procedures by which institutions must report their uses of HEERF grant funds, pursuant to these requirements, the U.S. Department of Education required quarterly public reporting of student portion and institutional portion awards and an annual report. Condition - The College drew down an expected amount for the institutional expenditures. The actual expenditures charged to the grant differed from those expected, resulting in the timing of the drawdown to be outside of the cash management regulations. By extension, the institutional quarterly reporting was also incorrect, as it was based on the initial expenditures classifications. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - The College drew down $2,725,815 for the institutional aid but did not spend the money within the required time frame allowed in accordance with cash management rules under 2 CFR Section 200.305(b). In addition, the drawdowns did not correspond With the quarterly reporting under CRRSA 314. Cause and Effect - The College used estimates to determine the amount that was eligible to perform the drawdowns through the period. The final expenditures claimed against the grant did not align with the cash drawdowns actually taken, causing exceptions within the cash management and reporting requirements. Recommendation - We recommend the College implement a process to minimize the time elapsed between the transfer of funds from the United States Treasury to the College and disbursement of those funds. In addition, we recommend management amend the quarterly reports to update the quarterly reporting to accurately reflect the changes made by management. Views of Responsible Officials and Corrective Action Plan - The College drew down funds based on expenditures that management deemed to be qualified however, at year-end, concluded to charge other expenditures to the grant causing the mismatch in the timing of drawdowns and final expenditures charged to the grant. Although HEERF and other COVID 19 Pandemic funding has ended, in the future, such expenditures will be discussed and documented prior to the drawing of funds.