Finding 384219 (2023-001)

Material Weakness
Requirement
N
Questioned Costs
-
Year
2023
Accepted
2024-03-25

AI Summary

  • Core Issue: Required provisions for federal-funded construction contracts were missing from the C.M. Eppes Middle School renovation contract.
  • Impacted Requirements: Compliance with 2 CFR Appendix II, including Equal Employment Opportunity and Davis-Bacon Act provisions.
  • Recommended Follow-up: Strengthen internal controls to ensure senior management reviews and monitors all federal-funded construction contracts for compliance.

Finding Text

K-12 Emergency Relief Funds Assistance Listing Number 84.425D. Pass-through: N.C. Department of Public Instruction. Program Report Code 171 and 181. Grant Period - Year Ended June 30, 2023. Criteria: In accordance with 2 CFR Appendix II, certain provisions are required to be included with all construction contracts which are funded with federal awards, to include Equal Employment Opportunity (Part 200(C)) Davis-Bacon Act, (Part 200 (D)); Contract Work Hours and Safety Standards Act, (Part 200(F)); Prohibition on Certain Telecommunications and Video Surveillance Services or Equipment, (2 CFR 200.16; and Domestic Preferences for Procurements (2 CFR 200.322). Condition: Per review of the contract for the renovations to C.M. Eppes Middle School, the required provisions were not included in the contract. Cause: Internal controls over compliance with all direct and material compliance requirements were not adequately implemented to ensure that all construction contracts funded with federal awards include the provisions required by 2 CFR Appendix II. Effect: The grantor agency could disallow expenditures related to the construction contract. Questioned Costs: None. Recommendation: Internal controls over compliance with federal contstruction contract provisions should be designed and implemented so that a member of senior management monitors construction contracts to ensure that those contracts funded by federal awards contain the provisions required by 2 CFR Appendix II, 2 CFR 200.216, and 2 CFR 200.322. Views of responsible officials: Per discussion with Michael Hardy, Chief Finance Officer, on December 19, 2023, management agrees with the finding and will implement corrective action immediately.

Categories

Procurement, Suspension & Debarment Equipment & Real Property Management Internal Control / Segregation of Duties Special Tests & Provisions

Other Findings in this Audit

  • 384218 2023-001
    Material Weakness
  • 960660 2023-001
    Material Weakness
  • 960661 2023-001
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
84.010 Title I Grants to Local Educational Agencies $8.74M
93.778 Medical Assistance Program $1.39M
84.367 Improving Teacher Quality State Grants $1.12M
10.555 National School Lunch Program $916,302
84.424 Student Support and Academic Enrichment Program $658,258
93.323 Covid-19 Epidemiology and Laboratory Capacity for Infectious Diseases (elc) $619,280
84.048 Career and Technical Education -- Basic Grants to States $504,217
84.027 Special Education_grants to States $454,060
12.U01 Reserve Officer Training Corps $363,326
10.559 Summer Food Service Program for Children $214,131
10.855 Distance Learning and Telemedicine Loans and Grants $146,871
84.374 Teacher Incentive Fund $133,465
10.582 Fresh Fruit and Vegetable Program $122,042
84.365 English Language Acquisition State Grants $90,454
93.495 Community Health Workers for Public Health Response and Resilient $56,960
84.324 Research in Special Education $46,852
84.323 Special Education - State Personnel Development $39,209
84.425 Covid-19 Education Stabilization Fund $32,602
84.173 Special Education_preschool Grants $806