Finding Text
2022-003 Department of Education, Passed through Minnesota Department of Education Federal Financial Assistance Listing/CFDA Number 84.425C/D/W Education Stabilization Fund Activities Allowed or Unallowed Material Weakness in Internal Control over Compliance Criteria ? A good system of internal accounting control contemplates an adequate system for review of account coding for expenditures of federal awards. Condition ? During the course of our engagement, we noted inconsistencies in use of account codes for federal expenditures and proposed material audit adjustments that were not identified as a result of the District?s existing internal controls over compliance, and therefore could have resulted in a material misstatement of the District?s schedule of expenditures of federal awards. Cause ? The District does not have an internal control system designed to review account coding for expenditures of federal awards. Effect ? This deficiency could result in a misstatement to the financial statements and noncompliance with federal awards that would not be prevented or detected. Questioned Costs ? None reported Context/Sampling ? A non-statistical sample of 60 transactions out of a population over 250 total transactions were selected for testing, which accounted for $704,562 of $3,722,843 of federal program expenditures. Repeat Finding from Prior Year(s) ? No Recommendation ? A thorough review and reconciliation of accounts used for expenditures of federal awards should take place prior to the beginning of the audit. This review should be done at both the accounting staff and accounting supervisor levels. Views of Responsible Officials ? There is no disagreement with the audit finding.