FAC Explorer

Finding 388349 (2023-007)

Material Weakness
Requirement
N
Questioned Costs
-
Year
2023
Accepted
2024-03-28
Audit: 300126
Organization: Department of Education, State of Hawaii (HI)
Auditor: Accuity LLP

AI Summary

  • Core Issue: Incomplete records of construction project expenditures funded by federal COVID-19 assistance were not provided during the audit.
  • Impacted Requirements: Noncompliance with Title 2, Section 200 of the CFR regarding wage standards for construction contracts over $2,000.
  • Recommended Follow-Up: Ensure accurate tracking and documentation of all expenditures and include compliance provisions in future construction contracts.

Finding Text

Questioned Costs $- Finding No. 2023‐007: Special Tests and Provisions (Material Weakness) Federal Agency: U.S. Department of Education Assistance Listing Number and Title: COVID‐19 84.425U – Education Stabilization Fund Condition During our audit, we noted program personnel were unable to provide a complete and accurate listing of all expenditures incurred in association with construction projects funded with program monies during fiscal year 2023. Criteria Pursuant to Title 2, Section 200, Appendix II, of the CFR, for all construction contracts in excess of $2,000 financed by federal funds, the Department is required to pay wages not less than those established for the locality of the project by the U.S. Department of Labor. Cause Personnel responsible for the tracking of construction projects funded with program monies during the period from July 2022 through April 2023 are no longer with the Department. Current program personnel began the oversight and tracking of such activities in May 2023, however they were unable to locate any records associated with the tracking of expenditures associated with construction projects funded with program monies that may have been maintained by the previous program personnel during the period from July 2022 through April 2023. Effect Failure to adhere to the program’s requirements exposes the Department to an undue risk of noncompliance with the requirements of Title 2 U.S. CFR Part 200. Context The Department was unable to provide a complete and accurate listing of all expenditures incurred in association with construction projects funded with program monies during fiscal year 2023. Repeat Finding This is not a repeat finding. Recommendation We recommend that the program personnel maintain a complete and accurate listing of all expenditures incurred in association with construction projects funded with program monies. We also recommend that the contractual terms of any construction contracts in excess of $2,000 financed with program monies include the appropriate provisions to comply with award requirements. Cause and View of Responsible Officials Due to turnover in critical positions, the program personnel were unable to furnish a complete and accurate listing of all executed construction contracts in excess of $2,000 and expenditures for each contract during fiscal year 2023. The program personnel will ensure retention of necessary documentation to comply with federal program requirements.

Corrective Action Plan

2023-007 Special Tests and Provisions – Material Weakness View of Responsible Officials Management agrees with the findings and recommendations. Corrective Action Plan The audit finding was due in large part to a vacancy in the Department ESSER grant support position that arose in the first quarter of the fiscal year, which contributed to the breakdown in construction project tracking. The Department hired a replacement for this grant support position in the second quarter of the fiscal year, and during the third quarter hired a second grant support position to ensure enhanced support capacity and continuity. These two individuals continue to comprise the ESSER Grant Management Office (team) and in the fourth quarter of the fiscal year initiated a process to document school and complex area use of ESSER funds for construction purposes. The team held a department-wide informational webinar in partnership with the Department’s Office of Facilities and Operations on May 22, 2023. The webinar agenda included the newly implemented pre-approval construction application process and federal requirements pursuant to Title 2, Section 200, Appendix II, of the Code of Federal Regulations (CFR). The team will continue to work with the Department’s Complex Area Staff to reiterate the award requirements and examine construction-related contracts over $2,000 to verify compliance with the award requirements. Contact Person: Brian Hallett Assistant Superintendent and CFO Office of Fiscal Services Anticipated Completion Date: June 30, 2024

Categories

Special Tests & Provisions Material Weakness Internal Control / Segregation of Duties

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
21.027 Coronavirus State and Local Fiscal Recovery Funds $50.00M
84.010 Title I Grants to Local Educational Agencies $48.49M
84.371 Striving Readers $11.46M
84.367 Improving Teacher Quality State Grants $9.02M
84.424 Student Support and Academic Enrichment Program $6.79M
84.287 Twenty-First Century Community Learning Centers $6.40M
84.027 Special Education_grants to States $5.36M
93.323 Epidemiology and Laboratory Capacity for Infectious Diseases (elc) $5.33M
15.875 Economic, Social, and Political Development of the Territories $4.53M
10.555 National School Lunch Program $4.46M
93.558 Temporary Assistance for Needy Families $4.03M
84.365 English Language Acquisition State Grants $3.73M
84.041 Impact Aid $3.70M
84.002 Adult Education - Basic Grants to States $3.20M
84.048 Career and Technical Education -- Basic Grants to States $2.77M
45.310 Grants to States $2.31M
84.011 Migrant Education_state Grant Program $2.09M
12.558 Department of Defense Impact Aid (supplement, Cwsd, Brac) $1.89M
84.369 Grants for State Assessments and Related Activities $1.63M
84.334 Gaining Early Awareness and Readiness for Undergraduate Programs $1.58M
10.582 Fresh Fruit and Vegetable Program $1.27M
84.425 Education Stabilization Fund $1.16M
10.560 State Administrative Expenses for Child Nutrition $871,179
12.556 Competitive Grants: Promoting K-12 Student Achievement at Military-Connected Schools $824,788
10.558 Child and Adult Care Food Program $694,366
84.372 Statewide Longitudinal Data Systems $625,241
84.184 Safe and Drug-Free Schools and Communities_national Programs $476,839
84.196 Education for Homeless Children and Youth $373,480
84.259 Native Hawaiian Career and Technical Education $283,634
12.600 Community Investment $221,906
84.362 Native Hawaiian Education $166,796
84.173 Special Education_preschool Grants $115,885
93.600 Head Start $108,990
93.079 Cooperative Agreements to Promote Adolescent Health Through School-Based Hiv/std Prevention and School-Based Surveillance $101,574
10.574 Team Nutrition Grants $94,051
84.424 Trauma Recovery Demonstration Grant Program $91,685
84.144 Migrant Education_coordination Program $84,339
10.541 Child Nutrition-Technology Innovation Grant $66,027
84.013 Title I State Agency Program for Neglected and Delinquent Children and Youth $62,221
84.368 Grants for Enhanced Assessment Instruments $60,993
10.579 Child Nutrition Discretionary Grants Limited Availability $57,926
10.559 Summer Food Service Program for Children $53,822
93.391 Activities to Support State, Tribal, Local and Territorial (stlt) Health Department Response to Public Health Or Healthcare Crises $25,000
84.365 Asian American and Pacific Islander Data Disaggregation Initiative $20,110
10.645 Farm to School State Formula Grant $15,674
93.243 Substance Abuse and Mental Health Services_projects of Regional and National Significance $3,799