Finding 50370 (2022-001)

Material Weakness
Requirement
C
Questioned Costs
-
Year
2022
Accepted
2023-05-30

AI Summary

  • Core Issue: Funds from the U.S. Department of Education were not disbursed within the required 3-day timeframe after being drawn down.
  • Impacted Requirements: Non-federal entities must minimize the time between receiving funds and disbursing them, as outlined in 2 CFR section 200.305(b).
  • Recommended Follow-up: Management should review grant terms and implement controls to ensure timely disbursement of funds in future programs.

Finding Text

Finding 2022-001: Cash Management ? Disbursement U.S. Department of Education ? Education Stabilization Fund COVID-19 Institutional Portion ? ALN 84.425F Criteria: Non-federal entities must minimize the time elapsing between the transfer of funds from the US Treasury or pass-through entity and disbursement by the non-federal entity for direct program or project costs and the proportionate share of allowable indirect costs, whether the payment is made by electronic funds transfer, or issuance or redemption of checks, warrants, or payment by other means (2 CFR section 200.305(b)). Condition: Management implemented a financial management system that meets the specified standards for fund control and accountability, but the system failed to ensure disbursement of funds within the required timeframe. Questioned Costs: None noted. Repeat Finding: This is not a repeat finding. Cause: Management did not accurately identify the required timeframe of disbursement for funds received under the Institutional Portion subprogram. A mitigating factor is the uniqueness of the Institutional Portion subprogram. Effect: Institutional Portion funds used to defray expenses associated with coronavirus was not disbursed within the required 3 calendar days of the drawdown from ED?s G5 grants system. Recommendation: Before drawing down from ED?s G5 grants system, management should familiarize themselves with the applicable terms, conditions, and requirements governing the organization?s use of the grant funds, and then implement a system of controls that will ensure compliance with those terms. Views of Responsible Parties and Corrective Action Plan: Management concurs with the finding. Since the program is not applicable to the organization after the issuance date of the financial statements, no corrective action is necessary.

Corrective Action Plan

May 31, 2023 Finding 2022-001: Cash Management ? Disbursement U.S. Department of Education ? Education Stabilization Fund ALN 84.425F COVID-19 Institutional Portion Criteria: Non-federal entities must minimize the time elapsing between the transfer of funds from the US Treasury or pass-through entity and disbursement by the non-federal entity for direct program or project costs and the proportionate share of allowable indirect costs, whether the payment is made by electronic funds transfer, or issuance or redemption of checks, warrants, or payment by other means (2 CFR section 200.305(b)). Condition: Management implemented a financial management system that meets the specified standards for fund control and accountability, but the system failed to ensure disbursement of funds within the required timeframe. Questioned Costs: None noted. Repeat Finding: This is not a repeat finding. Cause: Management did not accurately identify the required timeframe of disbursement for funds received under the Institutional Portion subprogram. A mitigating factor is the uniqueness of the Institutional Portion subprogram. Effect: Institutional Portion funds used to defray expenses associated with coronavirus was not disbursed within the required 3 calendar days of the drawdown from ED?s G5 grants system. Planned Corrective Action Management concurs with the finding. Since the program is not applicable to the organization after the issuance date of the financial statements, no corrective action is necessary. Responsible person: Sholom Goldstein, Executive Director Completed date: May 31, 2023

Categories

Cash Management Subrecipient Monitoring Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 626812 2022-001
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
84.063 Federal Pell Grant Program $1.18M
10.559 Summer Food Service Program for Children $903,975
10.553 School Breakfast Program $833,361
84.287 Twenty-First Century Community Learning Centers $352,000
93.600 Head Start $162,744
84.007 Federal Supplemental Educational Opportunity Grants $57,644
84.033 Federal Work-Study Program $51,501
10.555 National School Lunch Program $49,708
97.008 Non-Profit Security Program $44,610
10.649 Pandemic Ebt Administrative Costs $4,391
84.425 Education Stabilization Fund $2,850