Finding 442856 (2022-004)

Material Weakness
Requirement
AB
Questioned Costs
$1
Year
2022
Accepted
2023-03-30

AI Summary

  • Core Issue: Lack of effective internal controls over compliance with federal requirements for allowable costs, specifically regarding time and effort documentation.
  • Impacted Requirements: Non-compliance with 2 CFR 200.430 and 2 CFR 200.303, leading to questioned costs totaling over $410,000.
  • Recommended Follow-Up: Implement consistent controls and provide training to staff on compliance requirements to prevent future issues.

Finding Text

2022 ? 004 ? Special Education Cluster (IDEA) Activities Allowed or Unallowed & Allowable Costs/Cost PrinciplesFederal Agency: U.S. Department of EducationFederal Program Title: Special Education Cluster (IDEA)Assistance Listing Number: 84.027/84.173Federal Award Identification Number and Year: FY 21 and FY 22Pass-Through Entity: Indiana Department of EducationPass-Through Entity Number: 19611-76-PN01Award Period: July 1, 2020 through June 30, 2022Type of Finding:? Material Weakness in Internal Control over Compliance, Material Noncompliance (Modified Opinion)Criteria: Per 2 CFR 200.430, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:(i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated;(ii) Be incorporated into the official records of the non-Federal entity;(iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity,(iv) Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity's written policy;(v)2 CFR 200.303 states in part:"The non-Federal entity must:(a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ."(vi) Comply with the established accounting policies and practices of the non-Federal entity (See paragraph (h)(1)(ii) above for treatment of incidental work for IHEs.); and(vii) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.Condition: During our testing we that an effective internal control system was not in place to ensure compliance with requirements related to allowable costs. Additionally, time and effort procedures were not in place during the audit period.Questioned costs: Known - $80,310.67, Likely - $330,748.52. Known and questioned costs exceed program materiality.Context: In a statistically valid sample, 40 of 40 selections did not have adequate time and effort documentation along with proper timesheets, resulting in questioned costs.Cause: Per discussion with business manager and per testing performed, CLA noted the school did not have time and effort implemented, as they believe they were not required to.Effect: Activities or costs could be charged to a federal grant which do not meet the allowability standards, leading to noncompliance.Repeat Finding: No.Recommendation: We recommend the management ensure controls are consistently in place. Training over the organization's controls may be beneficial.View of Responsible Officials: There is no disagreement with the audit finding.

Categories

Questioned Costs Allowable Costs / Cost Principles

Other Findings in this Audit

  • 442839 2022-005
    Significant Deficiency
  • 442840 2022-006
    Significant Deficiency
  • 442841 2022-005
    Significant Deficiency
  • 442842 2022-006
    Significant Deficiency
  • 442843 2022-005
    Significant Deficiency
  • 442844 2022-006
    Significant Deficiency
  • 442845 2022-005
    Significant Deficiency
  • 442846 2022-006
    Significant Deficiency
  • 442847 2022-005
    Significant Deficiency
  • 442848 2022-006
    Significant Deficiency
  • 442849 2022-005
    Significant Deficiency
  • 442850 2022-006
    Significant Deficiency
  • 442851 2022-003
    Significant Deficiency
  • 442852 2022-004
    Material Weakness
  • 442853 2022-003
    Significant Deficiency
  • 442854 2022-004
    Material Weakness
  • 442855 2022-003
    Significant Deficiency
  • 442857 2022-003
    Significant Deficiency
  • 442858 2022-004
    Material Weakness
  • 1019281 2022-005
    Significant Deficiency
  • 1019282 2022-006
    Significant Deficiency
  • 1019283 2022-005
    Significant Deficiency
  • 1019284 2022-006
    Significant Deficiency
  • 1019285 2022-005
    Significant Deficiency
  • 1019286 2022-006
    Significant Deficiency
  • 1019287 2022-005
    Significant Deficiency
  • 1019288 2022-006
    Significant Deficiency
  • 1019289 2022-005
    Significant Deficiency
  • 1019290 2022-006
    Significant Deficiency
  • 1019291 2022-005
    Significant Deficiency
  • 1019292 2022-006
    Significant Deficiency
  • 1019293 2022-003
    Significant Deficiency
  • 1019294 2022-004
    Material Weakness
  • 1019295 2022-003
    Significant Deficiency
  • 1019296 2022-004
    Material Weakness
  • 1019297 2022-003
    Significant Deficiency
  • 1019298 2022-004
    Material Weakness
  • 1019299 2022-003
    Significant Deficiency
  • 1019300 2022-004
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
10.555 National School Lunch Program $1.07M
84.027 Special Education_grants to States $451,262
84.010 Title I Grants to Local Educational Agencies $218,367
84.425 Education Stabilization Fund $178,572
10.555 Commodities $126,057
10.558 Child and Adult Care Food Program $64,368
84.367 Improving Teacher Quality State Grants $57,388
93.778 Medical Assistance Program $49,040
10.579 Child Nutrition Discretionary Grants Limited Availability $21,910
84.173 Special Education_preschool Grants $14,920
10.559 Summer Food Service Program for Children $14,453
10.575 Farm to School Grant Program $10,000
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $6,032
84.424 Student Support and Academic Enrichment Program $703
10.649 Pandemic Ebt Administrative Costs $614