Finding Text
Federal Program Information:
Funding Agency: U.S. Department of Education
Title: Impact Aid (Title VII of ESEA)
FAL Number: 84.041
Passthrough: N/A
Award Year: 2024
Criteria: Per the Compliance Supplement – Application for Impact Aid – Section 7003 (OMB No. 1810-0687) – Each year an LEA must
submit this application, which provides the following information: counts of federally connected children in various categories,
membership and average daily attendance data, and information on expenditures for children with disabilities. Please note: As a
result of the public health emergency related to the coronavirus, the Impact Aid Coronavirus Relief Act (Pub. L. No. 116-211)
provides LEAs the option for their fiscal year 2022 7003 application of using the same student count data from their fiscal year
2021 application or providing new student count data as prescribed in Section 7003. Membership and average attendance data
should be tested. The auditor should use professional judgment when determining which categories to test, taking into account the
relative materiality of the number of children reported in other categories.
Condition: During our review of information provided in the Impact Aid application we identified the following issues:
A student who has no record of being in the special education program was listed on the Impact Aid application as
a student with disabilities.
Two students who are special education students were left off the application because of a keying error.
One hundred regular education students were left off the application because of a keying error.
The expenditure numbers included on table 7 of the application included numbers that were significantly less than
actual numbers for the District. The individual who entered the numbers took the wrong numbers from an expenditure
report. Instead of using the numbers from the expenditures to date column, the remaining budget balance numbers
were entered into the application.
• Number 1 – total additional expenditures of all children with disabilities were underreported by $5,513,453
• Number 4 – Total funds for Part B of Individuals with Disabilities Education Act were underreported by
$1,106,288
• Number 5 – Other sources of aid received for children with disabilities were underreported by $435,856.
There were errors in the prior year’s application as well, different types of errors, but at this time no progress has been made in this
area.
Questioned Costs: $0 – The District underreported eligible students on the application and underreported expenditures incurred in the
District for Impact Aid students with disabilities. The net effect is a reduction in funds that were available to the District. Even when
extrapolating one student out of 40 out of the 549 special education students on the application, this equates to 13.725 students which
may be in error. However, two were known to be excluded from the list plus 100 students for regular education. The total funding
lost exceeds funds that may have been obtained from the error rate.
Cause: There was not good inter-program communication to make sure special education students are properly accounted for on
the Impact Aid application. Additionally, there is no secondary review of numbers by another individual to verify that entry or
keying errors have not occurred in the application process.
Effect: The District is not in compliance with Federal regulations related to internal control procedures and compliance
requirements in relation to the grant and. In this case, the District has lost a significant amount of funding with the errors in
completing the application. Auditor’s Recommendation: When completing the Impact Aid application, the students included on the special education portion
of the application should be reviewed by the special education department to make sure all students are properly accounted for as
students may move in or out of the program.
Additionally, we recommend that a second person review numbers input to the application to verify correct entry and support for
those numbers to ensure that legitimate students counts and expenditure amounts are properly entered.
Responsible official’s view:
● Specific corrective action plan for the finding:
The departments will implement a review process that will add a second person to verify data that is entered manually.
● Timeline for completion of corrective action plan:
June 2025
● Employee positions(s) responsible for meeting the timeline:
Special Education Department, Intercultural & Community Outreach Department, Data Department, Finance
Department.