FAC Explorer

Finding 518127 (2024-002)

Significant Deficiency Repeat Finding
Requirement
A
Questioned Costs
-
Year
2024
Accepted
2025-01-08
Audit: 336435
Organization: Cooperative Educational Service Agency No. 8 (WI)
Auditor: Cliftonlarsonallen LLP

AI Summary

  • Core Issue: There is a significant deficiency in internal controls over compliance related to journal entry procedures.
  • Impacted Requirements: The agency must maintain records that support reported amounts, as required by Uniform Guidance and State Single Audit Guidelines.
  • Recommended Follow-Up: Implement internal controls for journal entries, ensuring proper segregation of duties and a review and approval process.

Finding Text

Federal Agency: Department of Education Federal Program Name: Career and Technical Education – Basic Grants to States Assistance Listing Number: 84.048A Pass-Through Agency: WI DPI Pass-Through Numbers: 2024-749908-DPI-CTE-400, 2023-749908-DPI-Reserve-422, 2024-749908-DPI-NTO-420 Award Period: 7/1/23 – 6/30/24 Type of Finding: Significant Deficiency in Internal Control over Compliance Condition: Uniform Guidance and the State Single Audit Guidelines require the Agency to maintain records supporting amounts reported into the schedule of expenditures of federal and state awards. Criteria or Specific Requirement: Having approved journal entries is an internal control intended to prevent, detect, and correct a potential misstatement. Cause: Due to lack of proper segregation of duties, there was not a review and approval process in place. Effect: Errors or intentional fraud could occur and not be detected timely by other employees in the normal course of their responsibilities as a result of a lack of segregation of duties. Repeat Finding: This is a repeat of finding 2023-002. Recommendation: We recommend the Agency establish internal controls surrounding journal entry procedures to ensure proper segregation of duties, review and approval processes. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding.

Corrective Action Plan

Management is cognizant of the Agency’s internal control structure and continues to evaluate cost effective opportunities to further improve segregation of duties. The Agency has strengthened the internal control structure in recent years by revising the roles and responsibilities of multiple positions within the accounting department. The Agency continues to identify and implement effective mitigating controls when possible. Current Agency procedures for journal entries include one position that is primarily responsible for preparation of journal entries and posting. The Agency is working on implementing procedures that involve program personnel assisting with preparation and/or review of journal entries. Name of responsible official: Nick Curran, Director of Business Operations Expected completion date: Ongoing, no formal expected completion date.

Categories

Internal Control / Segregation of Duties Reporting Significant Deficiency

Other Findings in this Audit

  • 518128 2024-002
    Significant Deficiency Repeat
  • 518129 2024-002
    Significant Deficiency Repeat
  • 1094569 2024-002
    Significant Deficiency Repeat
  • 1094570 2024-002
    Significant Deficiency Repeat
  • 1094571 2024-002
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
93.354 Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response $172,997
84.027 Special Education Grants to States $70,000
84.425 Education Stabilization Fund $25,000
84.048 Career and Technical Education -- Basic Grants to States $7,000