Finding Text
Material Weakness
Material Noncompliance
Program: Assistance Listing 84.010A - Title I Grants To Local Educational Agencies (Title I, Part A of the ESEA)
Assistance Listing: 84.027/84.173 – Special Education Cluster (IDEA)
Assistance Listing 84.425U – American Rescue Plan – Elementary and Secondary School Emergency Relief (ARP ESSER)
Repeat Finding: No
Criteria: 2 CFR 200.302 requires that a non-federal entity’s financial management system must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions. This section further requires the tracing of funds to a level of expenditure adequate to establish that such funds have been used according to the federal statutes, regulations, and the terms and conditions of the federal award, including a comparison of expenditures with budget amounts for each federal award. 2 CFR 200.303 requires that a non-federal entity must establish and maintain effective internal control over a federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statues, regulations, and the terms and conditions of the federal award.
Condition: The District’s internal controls over budgeting for federal grants are insufficient to ensure compliance with federal regulations and to stay within the budgetary limits established by the federal awards, as specified in the Mississippi Comprehensive Automated Performance-based System (MCAPS), administered through the Mississippi Department of Education. Specifically, the District has not adequately adhered to budgeting restraints outlined for its federal grants. Our audit procedures identified the following instances where actual expenditures appear to exceed the budgeted amounts:
• Twelve-line items in the Title I grants, totaling $104,453.87.
• Seven-line items in the ARP ESSER grant, totaling $259,335.59.
• Two-line items in the Special Education IDEA Part B grant, totaling $6,499.58.
Context/
Perspective: This finding is a result of our budget to actual comparisons for federal grant purposes of major programs and the conditions cited appear to be a systematic issue.
Cause: The District did not properly monitor budget limits established in MCAPS to ensure that budgeting requirements were fulfilled.
Effect: Failure to remain within established budget limits in MCAPS could affect future eligibility for federal award programs or result in a loss or misappropriation of public assets.
Questioned Costs: $370,289.04
Recommendation: The District should establish additional internal controls to ensure that it remains within budget limits for each grant maintained in MCAPS.
Views of
Responsible
Officials: The Auditee’s Corrective Action Plan on pages 99-100 lists the District’s response to the findings.