FAC Explorer

Finding 386711 (2023-007)

Material Weakness
Requirement
F
Questioned Costs
$1
Year
2023
Accepted
2024-03-28
Audit: 299007
Organization: City of Peabody (MA)
Auditor: Powers & Sullivan LLC

AI Summary

  • Core Issue: The City failed to obtain required prior approval for purchasing security camera equipment with grant funds.
  • Impacted Requirements: Compliance with equipment management rules under the Education Stabilization Fund, specifically regarding prior approval for capital expenditures.
  • Recommended Follow-Up: The City should establish internal controls to ensure all capital purchases have prior approval and maintain organized documentation for audits.

Finding Text

U.S. DEPARTMENT OF EDUCATION Passed through Massachusetts Department of Elementary and Secondary Education Education Stabilization Fund Education Stabilization Fund Federal Assistance Listing No. 84.425D, 84.425U and 84.425W 2023-007: Controls for the Purchase of Capital Equipment Compliance Requirement: Equipment/Real Property Management Type of Finding: Compliance and Material Weakness in Internal Control Over Compliance Criteria or Specific Requirement: Grantees must obtain prior approval from the pass-through entity for capital expenditures related to general and special purpose equipment purchases. Condition: The City was required to obtain prior approval from the pass-through entity for capital expenditures related to general or special purpose equipment. The City purchased security camera equipment and was unable to provide evidence that prior approval was obtained. Context: The City did not maintain sufficient documentation to demonstrate that approval was obtained prior to the purchase of capital equipment. Effect: The City has not complied with the grant requirements. Cause: Management has not established guidelines and procedures to ensure that approval is obtained prior to the purchase of capital equipment and that documentation of the approval is retained. Questioned Costs: The City expended a total of $4,564,014 in Education Stabilization Funds in 2023, of which $619,967 was charged to a contract services account. Of the total charged to the contract services account, $302,687 was selected for testing and $73,629 was spent on the purchase of security camera equipment without prior approval from the pass-through entity. Recommendation: The City should implement internal control procedures to ensure compliance with all grant requirements including the need to obtain prior approval from the pass-through entity for capital expenditures paid from the Education Stabilization Funds grants. The documentation should be filed in an organized manner and readily available for inspection during the audit. Views of Responsible Officials and Planned Corrective Actions: The School District will implement internal control procedures to ensure that the required approvals are obtained and the documentation is maintained in an organized manner. Management plans to implement these procedures in 2024.

Categories

Questioned Costs Equipment & Real Property Management Procurement, Suspension & Debarment Subrecipient Monitoring Material Weakness

Other Findings in this Audit

  • 386679 2023-002
    Material Weakness Repeat
  • 386680 2023-002
    Material Weakness Repeat
  • 386681 2023-002
    Material Weakness Repeat
  • 386682 2023-002
    Material Weakness Repeat
  • 386683 2023-002
    Material Weakness Repeat
  • 386684 2023-002
    Material Weakness Repeat
  • 386685 2023-003
    Material Weakness Repeat
  • 386686 2023-003
    Material Weakness Repeat
  • 386687 2023-003
    Material Weakness Repeat
  • 386688 2023-003
    Material Weakness Repeat
  • 386689 2023-004
    Material Weakness
  • 386690 2023-004
    Material Weakness
  • 386691 2023-004
    Material Weakness
  • 386692 2023-004
    Material Weakness
  • 386693 2023-005
    Material Weakness
  • 386694 2023-005
    Material Weakness
  • 386695 2023-005
    Material Weakness
  • 386696 2023-005
    Material Weakness
  • 386697 2023-006
    Material Weakness Repeat
  • 386698 2023-006
    Material Weakness Repeat
  • 386699 2023-006
    Material Weakness Repeat
  • 386700 2023-006
    Material Weakness Repeat
  • 386701 2023-006
    Material Weakness Repeat
  • 386702 2023-006
    Material Weakness Repeat
  • 386703 2023-006
    Material Weakness Repeat
  • 386704 2023-006
    Material Weakness Repeat
  • 386705 2023-007
    Material Weakness
  • 386706 2023-007
    Material Weakness
  • 386707 2023-007
    Material Weakness
  • 386708 2023-007
    Material Weakness
  • 386709 2023-007
    Material Weakness
  • 386710 2023-007
    Material Weakness
  • 386712 2023-007
    Material Weakness
  • 386713 2023-008
    Material Weakness
  • 386714 2023-008
    Material Weakness
  • 386715 2023-008
    Material Weakness
  • 386716 2023-008
    Material Weakness
  • 386717 2023-008
    Material Weakness
  • 386718 2023-008
    Material Weakness
  • 386719 2023-008
    Material Weakness
  • 386720 2023-008
    Material Weakness
  • 963121 2023-002
    Material Weakness Repeat
  • 963122 2023-002
    Material Weakness Repeat
  • 963123 2023-002
    Material Weakness Repeat
  • 963124 2023-002
    Material Weakness Repeat
  • 963125 2023-002
    Material Weakness Repeat
  • 963126 2023-002
    Material Weakness Repeat
  • 963127 2023-003
    Material Weakness Repeat
  • 963128 2023-003
    Material Weakness Repeat
  • 963129 2023-003
    Material Weakness Repeat
  • 963130 2023-003
    Material Weakness Repeat
  • 963131 2023-004
    Material Weakness
  • 963132 2023-004
    Material Weakness
  • 963133 2023-004
    Material Weakness
  • 963134 2023-004
    Material Weakness
  • 963135 2023-005
    Material Weakness
  • 963136 2023-005
    Material Weakness
  • 963137 2023-005
    Material Weakness
  • 963138 2023-005
    Material Weakness
  • 963139 2023-006
    Material Weakness Repeat
  • 963140 2023-006
    Material Weakness Repeat
  • 963141 2023-006
    Material Weakness Repeat
  • 963142 2023-006
    Material Weakness Repeat
  • 963143 2023-006
    Material Weakness Repeat
  • 963144 2023-006
    Material Weakness Repeat
  • 963145 2023-006
    Material Weakness Repeat
  • 963146 2023-006
    Material Weakness Repeat
  • 963147 2023-007
    Material Weakness
  • 963148 2023-007
    Material Weakness
  • 963149 2023-007
    Material Weakness
  • 963150 2023-007
    Material Weakness
  • 963151 2023-007
    Material Weakness
  • 963152 2023-007
    Material Weakness
  • 963153 2023-007
    Material Weakness
  • 963154 2023-007
    Material Weakness
  • 963155 2023-008
    Material Weakness
  • 963156 2023-008
    Material Weakness
  • 963157 2023-008
    Material Weakness
  • 963158 2023-008
    Material Weakness
  • 963159 2023-008
    Material Weakness
  • 963160 2023-008
    Material Weakness
  • 963161 2023-008
    Material Weakness
  • 963162 2023-008
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
21.027 Covid-19 Coronavirus State and Local Fiscal Recovery Funds $5.34M
14.239 Home Investment Partnerships Program $2.33M
10.555 National School Lunch Program $1.62M
93.323 Epidemiology and Laboratory Capacity for Infectious Diseases (elc) $510,404
10.553 School Breakfast Program $304,229
97.036 Covid-19 Disaster Grants - Public Assistance (presidentially Declared Disasters) $249,639
10.555 Covid-19 National School Lunch Program $168,352
93.959 Block Grants for Prevention and Treatment of Substance Abuse $134,765
93.959 Covid-19 Block Grants for Prevention and Treatment of Substance Abuse $125,000
14.218 Covid-19 Community Development Block Grants/entitlement Grants $123,185
84.027 Covid-19 Special Education_grants to States $110,945
93.354 Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response $89,477
84.173 Special Education_preschool Grants $65,425
97.044 Assistance to Firefighters Grant $49,750
20.600 State and Community Highway Safety $47,173
84.425 Covid-19 Education Stabilization Fund $40,190
97.042 Emergency Management Performance Grants $27,941
84.371 Striving Readers - Comprehensive Literacy Development Grants $27,500
84.173 Covid-19 Special Education_preschool Grants $26,236
84.010 Title I Grants to Local Educational Agencies $21,500
84.048 Career and Technical Education -- Basic Grants to States $19,610
93.044 Special Programs for the Aging_title Iii, Part B_grants for Supportive Services and Senior Centers $16,018
16.738 Edward Byrne Memorial Justice Assistance Grant Program $14,060
84.196 Education for Homeless Children and Youth $10,000
14.218 Community Development Block Grants/entitlement Grants $5,722
16.922 Equitable Sharing Program $5,100
45.310 Grants to States - State Library Program $4,200
84.424 Student Support and Academic Enrichment Program $3,800
84.027 Special Education_grants to States $2,500
10.559 Summer Food Service Program for Children $2,468
16.607 Bulletproof Vest Partnership Program $2,437
84.367 Supporting Effective Instruction State Grants $1,879
93.645 Stephanie Tubbs Jones Child Welfare Services Program $1,873
84.365 English Language Acquisition State Grants $1,350