FAC Explorer

Finding 509470 (2022-002)

Material Weakness
Requirement
P
Questioned Costs
-
Year
2022
Accepted
2024-11-20
Audit: 329168
Organization: Clarkson University (NY)
Auditor: Kpmg

AI Summary

  • Core Issue: The University lacked adequate controls for accurately reporting expenditures on the Schedule of Expenditures of Federal Awards, leading to significant omissions and misclassifications.
  • Impacted Requirements: Compliance with 2 CFR 200.510(b) and 2 CFR 200.303 was not met, as the University failed to maintain effective internal controls for financial reporting.
  • Recommended Follow-Up: Implement robust internal controls and documented procedures to ensure accurate and complete reporting on the Schedule, preventing future errors.

Finding Text

Finding Number: 2022-002 Program: Research and Development Cluster Federal Agency Names: U.S. National Aeronoautics and Space Adminstration; U.S. Department of Agriculture; U.S. Department of Defense; U.S. Department of Energy; U.S. Department of Health and Human Services; U.S. Department of Transportation; U.S. Department of Commerce; U.S. Environmental Protection Agency; U.S. Department of Homeland Security; U.S. Department of Interior; and National Science Foundation Federal Award Numbers: Various – as listed on the Schedule Federal Award Years: Various Federal Assistance Listing Numbers: Various – as listed on the Schedule Compliance Requirement: Other – Inaccurate reporting of the Schedule of Expenditures of Federal Awards Criteria According to 2 CFR 200.510(b), a recipient of federal awards is required to prepare a schedule of expenditures of Federal awards (Schedule) for the period covered by the auditee’s financial statements which must include the total federal awards expended as determined in accordance with 2 CFR 200.502. Additionally, 2CFR 200.303 requires non-Federal entities receiving Federal awards to establish and maintain internal controls designed to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements. Effective internal controls should include procedures to ensure federal expenditures are accurately reported on the Schedule and information provided for audit purposes is complete and accurate. Conditions Found The University did not have adequate controls relating to the reporting of expenditures on the Schedule for the Research and Development Cluster. Specifically, the University did not have documented procedures on how to query and analyze expenditure data from the Peoplesoft system and the management review controls over the preparation of the Schedule were not designed to operate at an appropriate level of precision. As a result, during 2023 the University determined that $1,552,891 related to the Research and Development Cluster were inadvertently omitted from the June 30, 2022 Schedule. Additionally, expenditures in the amount of $14,289 related to the National Endowment for the Humanities – Promotion of the Humanities Teaching and Learning Resources (ALN 45.162) had been incorrectly included as part of the Research and Development Cluster. The combination of these errors resulted in a total of $1,538,602 of Research and Development Cluster expenditures being added to the June 30, 2022 Schedule. The University also had incorrectly reported encumbrances, which represent future expenditures that have been obligated but not incurred. Cause In discussing these conditions with the University, they stated the errors were primarily due to turnover in staff responsible for preparation of the Schedule as well as a lack of documented procedures. Additionally, the management review controls in place were not operating at a sufficient level of precision to detect the errors. Effect Failure to establish effective internal controls regarding financial reporting for the preparation of the Schedule may prevent the University from completing an audit in accordance with the timelines of Uniform Guidance. Questioned Costs Not applicable. Statistical Sample Not applicable. Repeat Finding This finding is not a repeat finding in the immediately prior audit. Recommendation We recommend the University implement a system of internal control that is designed and operating at a level of precision to ensure the Schedule is complete and accurate

Categories

Reporting Matching / Level of Effort / Earmarking

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $27.58M
84.038 Federal Perkins Loan Program $3.59M
84.425 Education Stabilization Fund $3.20M
84.063 Federal Pell Grant Program $2.84M
66.469 Great Lakes Program $1.02M
84.033 Federal Work-Study Program $584,074
84.007 Federal Supplemental Educational Opportunity Grants $440,184
84.042 Trio_student Support Services $300,517
84.217 Trio_mcnair Post-Baccalaureate Achievement $276,721
12.114 Collaborative Research and Development $269,691
93.394 Cancer Detection and Diagnosis Research $235,375
84.365 English Language Acquisition State Grants $232,285
93.865 Child Health and Human Development Extramural Research $219,366
12.300 Basic and Applied Scientific Research $170,651
47.050 Geosciences $145,324
20.200 Highway Research and Development Program $135,549
81.049 Office of Science Financial Assistance Program $126,925
47.075 Social, Behavioral, and Economic Sciences $119,135
81.086 Conservation Research and Development $93,251
12.910 Research and Technology Development $88,674
47.076 Education and Human Resources $80,122
11.431 Climate and Atmospheric Research $78,920
10.310 Agriculture and Food Research Initiative (afri) $70,312
93.273 Alcohol Research Programs $67,320
12.420 Military Medical Research and Development $66,293
47.074 Biological Sciences $63,895
97.077 Homeland Security Research, Development, Testing, Evaluation, and Demonstration of Technologies Related to Nuclear Threat Detection $62,166
93.173 Research Related to Deafness and Communication Disorders $50,822
12.800 Air Force Defense Research Sciences Program $49,620
12.901 Mathematical Sciences Grants Program $47,280
11.609 Measurement and Engineering Research and Standards $43,130
43.002 Aeronautics $27,830
43.008 Education $26,182
66.511 Office of Research and Development Consolidated Research/training/fellowships $17,249
47.049 Mathematical and Physical Sciences $17,248
81.117 Energy Efficiency and Renewable Energy Information Dissemination, Outreach, Training and Technical Analysis/assistance $17,051
45.162 Promotion of the Humanities_teaching and Learning Resources and Curriculum Development $14,289
93.989 International Research and Research Training $8,935
43.012 Space Technology $8,641
47.041 Engineering $7,816
12.000 Unknown (battelle) $7,793
93.913 Grants to States for Operation of Offices of Rural Health $7,600
12.431 Basic Scientific Research $6,819
15.944 Natural Resource Stewardship $6,170
84.037 Federal Perkins Loan Cancellations $4,700
20.215 Highway Training and Education $3,798
47.070 Computer and Information Science and Engineering $3,719
93.859 Biomedical Research and Research Training $2,616
84.126 Rehabilitation Services_vocational Rehabilitation Grants to States $344