Finding 519683 (2024-002)

Material Weakness
Requirement
AB
Questioned Costs
$1
Year
2024
Accepted
2025-01-17
Audit: 338758
Auditor: Eide Bailly LLP

AI Summary

  • Core Issue: There is a significant lack of time-and-effort reporting for employees charged to federal programs, leading to potential noncompliance with federal regulations.
  • Impacted Requirements: The absence of accurate records for salaries and wages violates the Uniform Guidance, specifically 2 CFR 200.430, which mandates proper documentation of personnel costs.
  • Recommended Follow-Up: The District should implement regular reviews of personnel costs and establish robust policies to ensure all charges to federal programs are supported by adequate documentation.

Finding Text

Criteria or Specific Requirements The Uniform Guidance states that allowable personnel costs charged to federal programs may include reasonable amounts for activities contributing and directly related to work under an agreement (2 CFR 200.430(i)(1)(i)). Charges to federal awards for salaries and wages must be based on records that accurate reflect the work performed (2 CFR 200.430(g)(1)). Condition Material Weakness in Internal Control over Compliance – Time-and-effort reporting, or another similar internal control activity to retroactively verify employee time spent on the program was not reviewed and approved or not performed for the year ending June 30, 2024. During testing over Activities Allowed or Unallowed and Allowable Cost requirements, the following deficiencies were noted:  For the Career and Technical Education program, 14 out of 14 employees selected for testing do not have time-and-effort record reflecting the distribution of the employee’s salary and wages for the federal program.  For the Title III and V programs, we noted the following – o 25 out of 30 employees selected for testing did not have time-and-effort record reflecting the distribution of the employee’s salary and wages for the federal program. o 5 out of 30 employees selected for testing had time-and-effort records, however, there were no evidence of review and approval. 2 of the 5 employees also had incomplete time-and-effort reports (i.e. only for half of the fiscal year, or a few months). Questioned Costs Career Technical Education – Basic Grants to States known questioned costs: $749,547. Higher Education Institutional Aid programs known questioned costs: $1,431,770. Context The Career Technical Education program reference above had a total of $2,355,332 in expenditures for the year ended June 30, 2024, of which $1,108,453 were associated with salaries and benefits. There was a total population of 66 employees charged to the program in the fiscal year ended June 30, 2024. The Title III and V programs referenced above had a total of $2,865,454 in expenditures for the year ended June 30, 2024, of which $2,248,191 associated with salaries and benefits. There was a total population of 148 employees charged to the program in the fiscal year ended June 30, 2024. Effect Without effective internal controls in place over personnel costs, the District risks noncompliance for program costs that could be material. Cause The District does not have policies and procedures in place to review personnel charges to identify the employee costs that should and should not be charged to the federal program referenced above. Repeat Finding (Yes or No) No Recommendation The District should monitor personnel costs charged to federal programs in accordance with the Uniform Guidance. The District should review personnel costs on a regular basis to ensure that costs charged are supported by allowable activities directly related to the program. Additionally, adequate supporting documentation should be retained for personnel costs charged to the federal programs. Views of Responsible Officials and Corrective Action Plan The District and campus staff will work together to develop processes to capture proper and relevant time and effort activities. This will ensure documentation can be provided regarding personnel expenses to identify employee costs charged to federal programs.

Categories

Questioned Costs Allowable Costs / Cost Principles Material Weakness Reporting

Other Findings in this Audit

  • 519674 2024-003
    Significant Deficiency Repeat
  • 519675 2024-003
    Significant Deficiency Repeat
  • 519676 2024-003
    Significant Deficiency Repeat
  • 519677 2024-003
    Significant Deficiency Repeat
  • 519678 2024-003
    Significant Deficiency Repeat
  • 519679 2024-002
    Material Weakness
  • 519680 2024-002
    Material Weakness
  • 519681 2024-002
    Material Weakness
  • 519682 2024-002
    Material Weakness
  • 519684 2024-002
    Material Weakness
  • 519685 2024-002
    Material Weakness
  • 1096116 2024-003
    Significant Deficiency Repeat
  • 1096117 2024-003
    Significant Deficiency Repeat
  • 1096118 2024-003
    Significant Deficiency Repeat
  • 1096119 2024-003
    Significant Deficiency Repeat
  • 1096120 2024-003
    Significant Deficiency Repeat
  • 1096121 2024-002
    Material Weakness
  • 1096122 2024-002
    Material Weakness
  • 1096123 2024-002
    Material Weakness
  • 1096124 2024-002
    Material Weakness
  • 1096125 2024-002
    Material Weakness
  • 1096126 2024-002
    Material Weakness
  • 1096127 2024-002
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $4.29M
21.027 Coronavirus State and Local Fiscal Recovery Funds $3.43M
84.007 Federal Supplemental Educational Opportunity Grants $2.41M
84.033 Federal Work-Study Program $1.14M
84.048 Career and Technical Education -- Basic Grants to States $738,479
84.116 Fund for the Improvement of Postsecondary Education $500,586
84.126 Rehabilitation Services Vocational Rehabilitation Grants to States $455,054
84.031 Higher Education Institutional Aid $383,922
84.042 Trio Student Support Services $358,116
84.382 Strengthening Minority-Serving Institutions $340,702
84.047 Trio Upward Bound $292,072
84.002 Adult Education - Basic Grants to States $238,769
93.558 Temporary Assistance for Needy Families $69,994
84.063 Federal Pell Grant Program $53,835
47.076 Stem Education (formerly Education and Human Resources) $44,452
93.859 Biomedical Research and Research Training $44,377
47.070 Computer and Information Science and Engineering $27,531
10.558 Child and Adult Care Food Program $25,348
94.006 Americorps State and National 94.006 $25,140
10.223 Hispanic Serving Institutions Education Grants $22,668
64.117 Survivors and Dependents Educational Assistance $14,137