Finding Text
2024-004: Equipment Management—Material Weakness
U.S. Department of Education
Passed through Missouri Department of Elementary and Secondary Education
Education Stabilization Fund, Assistance Listing No. 84.425C (COVID-19 - Governor’s Emergency Education Relief Fund), 84.425D (COVID-19 - Elementary and Secondary School Emergency Relief Fund), 84.425U (COVID-19 - American Rescue Plan-Elementary and Secondary School Emergency Relief), 84.425W (COVID-19 - American Rescue Plan-Elementary and Secondary School Emergency Relief-Homeless Children and Youth)
Federal award year 2023-2024
Criteria: The Uniform Guidance (2 CFR 200.303) requires nonfederal entities receiving federal awards to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance retirements. Also, in accordance with 2 CFR section 200.313(d)(1), property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the federal award identification number), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property.
In accordance with 2 CFR section 200.313(d)(2), a physical inventory of equipment and property must be taken, and the results reconciled with the property records at least once every two years.
Condition: The District’s controls were not operating effectively to reasonably ensure the District had maintained property records with the above required information, and performed the required physical inventory of equipment within the two previous years. As a result, the District did not comply with the compliance requirements for equipment and property.
Cause: The District does not have processes and procedures in place related to equipment management, tracking and required physical inventories.
Effect or potential effect: The District is not in compliance with federal grant requirements over the tracking and physical inventory of equipment. Improper equipment procedures could result in actions taken by oversight agencies which could impact future funding.
Questioned costs: None
Context: For all sample selections tested in the major program, there was no process of tagging and tracking equipment purchased with federal funding, nor evidence that any physical inventories had been performed.
Identification as a repeat finding, if applicable: Not applicable.
Recommendation: We recommend the District develop processes and procedures to tag and track equipment purchased with federal funding, and maintain support that physical inventory inventories were performed as required.
View of responsible officials: Management agrees with this finding.