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FINDING 2022-007Subject: COVID-19 - Education Stabilization Fund - ReportingFederal Agency: Department of EducationFederal Program: COVID-19 - Education Stabilization FundAssistance Listings Numbers: 84.425C, 84.425D, 84.425UFederal Award Numbers and Years (or Other Identifying Numbers): S425C200018, S425D200013,S425U210013Pass-Through Entity: Indiana Department of EducationCompliance Requirement: ReportingAudit Finding: Material WeaknessCondition and ContextAn effective internal control system, was not designed nor implemented at the School Corporationto ensure compliance with requirements related to the grant agreement and the Reporting compliancerequirement.The School Corporation had not designed nor implemented a system of internal controls to ensurethat the annual Elementary and Secondary School Emergency Relief (ESSER) and the Governor'sEmergency Education Relief (GEER) annual Data Collection reports (Reports) were complete and accuratelysubmitted. The Reports were prepared by one employee without an oversight or review processin place to prevent, or detect and correct, errors.The lack of internal controls was a systemic issue throughout the audit period.Criteria2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that providesreasonable assurance that the non-Federal entity is managing the Federal award incompliance with Federal statutes, regulations, and the terms and conditions of the Federalaward. These internal controls should be in compliance with guidance in 'Standards forInternal Control in the Federal Government' issued by the Comptroller General of theUnited States or the 'Internal Control Integrated Framework', issued by the Committee ofSponsoring Organizations of the Treadway Commission (COSO). . . ."CauseManagement had not developed nor implemented an effective internal control system that wouldhave ensured compliance with the grant agreement and the Reporting compliance requirement.EffectThe failure to establish an effective internal control system could have enabled material noncomplianceto go undetected.Questioned CostsThere were no questioned costs identified.RecommendationWe recommended that the School Corporation's management establish internal controls to ensurecompliance with the grant agreement and the Reporting compliance requirement.Views of Responsible OfficialsFor the views of responsible officials, refer to the Corrective Action Plan that is part of this report.