Finding 381093 (2023-001)

Material Weakness
Requirement
F
Questioned Costs
-
Year
2023
Accepted
2024-03-19

AI Summary

  • Core Issue: The Charter School failed to conduct required inventory counts for assets purchased with Federal funds, violating federal regulations.
  • Impacted Requirements: 2 CFR Section 200.313(d)(2) mandates a physical inventory every two years, which was not followed.
  • Recommended Follow-Up: Ensure adherence to financial policies by performing regular inventory audits and updating internal controls to prevent future issues.

Finding Text

Identification of the Federal Program Assistance Listing (AL) 84.425 Education Stabilization Funds (ESF) / Elementary and Secondary School Emergency Relief Fund. Criteria Requirements per section 2 CFR Section 200.313(d)(2) of the Uniform Guidance state that a physical inventory of any property purchased with Federal Funds must be taken and the results reconciled with the property records at least every two years. Statement of condition During our audit we noted the Charter School did not adhere to the terms of their financial policies and procedures manual and federal statutes, regulations, and terms and conditions of the awards received as they did not perform an inventory count at least every two years for assets purchased with Federal funds. Cause Management’s internal control procedures did not identify the need for a property inventory count on a bi -annual basis. The procedure was included in the Charter School’s internal financial policies and procedures manual as required but the actual count did not occur. Effect or Potential Effect Without a regular inventory count, property and equipment could be lost or stolen and would not be identified in a timely manner. Questioned Costs N/A Recommendation We recommend the Charter School adheres to the terms of their financial policies and procedures manual to perform inventory audits over assets purchased with Federal funds. Views of Responsible Officials Management concurs with the finding and we will update our internal controls and perform a physical count of all capital assets to ensure assets purchased with Federal funds are properly inventoried. Auditor’s Evaluation of the Views of Responsible Officials Management’s response is appropriate to address the finding. If properly implemented, management’s response would include procedures to prevent reoccurrence in the future.

Categories

Equipment & Real Property Management

Other Findings in this Audit

  • 381092 2023-001
    Material Weakness
  • 957534 2023-001
    Material Weakness
  • 957535 2023-001
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
84.425 Education Stabilization Fund $247,755
84.010 Title I Grants to Local Educational Agencies $70,746
93.575 Child Care and Development Block Grant $44,259
10.553 School Breakfast Program $31,060
10.555 National School Lunch Program $19,577
84.367 Improving Teacher Quality State Grants $10,405
84.424 Student Support and Academic Enrichment Program $10,000
10.649 Pandemic Ebt Administrative Costs $628