Finding Text
Noncompliance/Material Weakness – Questioned Cost
2 C.F.R. § 3474.1 gives regulatory effect to the Department of Education for 2 C.F.R. § 200.430 which states, in part, that costs of compensation are allowable to the extent that they satisfy the specific requirements of this part, and that the total compensation for individual employees is reasonable for the services rendered and conforms to the established written policy of the non-Federal entity consistently applied to both Federal and non-Federal activities. In addition, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed.
The District recorded and expenditure adjustment reclassifying payroll and benefit expenditures from the General Fund to the Special Education – Grants to State (IDEA, Part B) in the amount $209,856. The District was not able to provide which employees these expenses related to, therefor no documentation existed to conclude that the expenditures related to special education activities. The $209,856 from Special Education – Grants to State (IDEA, Part B) is considered a questioned cost.
Failure to maintain the appropriate clear and concise supporting documentation for infrequent and unusual transaction could result in questioned costs and reduced future federal funding or the requirement to repay the Ohio Department of Education and Workforce.
We recommend the District implement additional control procedures that ensure any expenditure adjustment maintains adequate supporting documentation.