Finding Text
50000 – Activities Allowed or Unallowed and Allowable Costs/Cost Principles (Material Weakness in Internal Control Over Compliance, Material Noncompliance)
Federal Agency: U.S. Department of Education
Pass-Through Agency: California Department of Education
Program Name: Education Stabilization Fund
Federal Financial Assistance Listing: 84.425C, 84.425D, 84.425U, 84.425W
Compliance Requirement: A/B - Allowed or Unallowed & Allowable Costs/Cost Principles
Type of Finding: Material weakness and material noncompliance
Criteria or Specific Requirements
Per Title 2, Code of Federal Regulations, Part 200, Subpart D, Section 200.333, financial records and supporting documents pertinent to a Federal award must be retained for a period of three years from the date of submission of expenditure reports to the awarding agency or passthrough entity.
Condition
The District was unable to provide financial records or supporting documents for four of 60 expenditures sampled.
Cause
The identified condition appears to have materialized due to insufficient procedures related to the retention of financial records.
Effect
The District has not complied with the requirements identified in Title 2, Code of Federal Regulations, Part 200.333.
Questioned Costs
The condition identified above resulted in known questioned costs of $376,240.
Context/Sampling
A nonstatistical sample of 60 transactions out of 856 total transactions were selected for testing, which accounted for $3,795,432 of $7,419,851 of federal program expenditures.
Repeat Finding
No.
Recommendation
The District should ensure that all federal expenditures are supported by financial reports. These records should be maintained for a period of three years from the date the expenditure is incurred.