FAC Explorer

Finding 396171 (2023-002)

Significant Deficiency
Requirement
P
Questioned Costs
-
Year
2023
Accepted
2024-05-08
Audit: 305799
Organization: Cooperative Educational Service Agency No. 8 (WI)
Auditor: Cliftonlarsonallen LLP

AI Summary

  • Core Issue: There is a significant deficiency in internal controls over compliance related to journal entry procedures.
  • Impacted Requirements: The Agency must maintain records supporting reported amounts as per Uniform Guidance and State Single Audit Guidelines.
  • Recommended Follow-Up: Implement internal controls for journal entries, ensuring proper segregation of duties and a review and approval process.

Finding Text

Federal Agency: Department of Education Federal Program Name: Career and Technical Education – Basic Grants to States Assistance Listing Number: 84.048A Pass-Through Agency: WI DPI Pass-Through Numbers: 2023-749908-DPI-CTE-400, 2023-749908-DPI-Reserve-422, 2023-749908-DPI-NTO-420 Award Period: 7/1/22 – 6/30/23 Type of Finding: Significant Deficiency in Internal Control over Compliance Condition: Uniform Guidance and the State Single Audit Guidelines require the Agency to maintain records supporting amounts reported into the schedule of expenditures of federal and state awards. Criteria or Specific Requirement: Having approved journal entries is an internal control intended to prevent, detect, and correct a potential misstatement. Cause: Due to lack of proper segregation of duties, there was not a review and approval process in place. Effect: Errors or intentional fraud could occur and not be detected timely by other employees in the normal course of their responsibilities as a result of a lack of segregation of duties. Repeat Finding: No. Recommendation: We recommend the Agency establish internal controls surrounding journal entry procedures to ensure proper segregation of duties, review and approval processes. Views of responsible officials and planned corrective actions: Management agrees with the finding.

Corrective Action Plan

Management is cognizant of the Agency’s internal control structure and continues to evaluate cost effective opportunities to further improve segregation of duties. The Agency has strengthened the internal control structure in recent years by revising the roles and responsibilities of multiple positions within the accounting department. The Agency continues to identify and implement effective mitigating controls when possible. Current Agency procedures for journal entries include one position that is primarily responsible for preparation of journal entries and posting. The Agency is working on implementing procedures that involve program personnel assisting with preparation and/or review of journal entries. Name of responsible official: Nick Curran, Director of Business Operations Expected completion date: Ongoing, no formal expected completion date.

Categories

Internal Control / Segregation of Duties Reporting Significant Deficiency

Other Findings in this Audit

  • 396172 2023-002
    Significant Deficiency
  • 396173 2023-002
    Significant Deficiency
  • 972613 2023-002
    Significant Deficiency
  • 972614 2023-002
    Significant Deficiency
  • 972615 2023-002
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
93.354 Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response $151,200
84.027 Special Education_grants to States $55,000
84.425 Education Stabilization Fund $9,374
84.048 Career and Technical Education -- Basic Grants to States $7,000