Finding Text
Inadequate documentation for federal expenditures Condition: The District failed to timely provide adequate documentation as to compliance with capital budgets in a federal program resulting in a repayment of funds expended in the previous fiscal year. Criteria: The district has an approved budget for federal programming and must obtain approval for any budget amendments in a timely manner. Certain capital expenditures require approval prior to purchasing through application and budget process. Cause: The District failed to timely request and receive a budget amendment for a federal program during the presribed time period. Effect: During the current fiscal year, the Minnesota Department of Education (MDE) required the District to repay federal funds expended in the previous year for specific capital items since the budget amendment was not timely submitted by the District. MDE subsequently reallocated those program funds back to the District and approved for District use in the current fiscal year. This was material to the District's federal funds and required material adjustments to the financial statements and a reconcilding variance to the Schedule of Expenditures of Federal Awards (SEFA). The total amount reallocated to the current fiscal year was $236,260 for this program. Recommendation: The District review all federal expenditures recorded in UFARS against the approved budgets. If modifications are required from the original application, the District should implement procedures to submit the proposed modifications to the oversight agency in a timely manner. Views of Responsible Officials and Planned Corrective Actions: The District acknowledges the instance and determined it to be an isolated instance due to staff turnover in the business office. The District has hired additional business office staff. Repeat Finding: No