Finding Text
Federal Agency: U.S. Department of Education
Award Name: Charter Schools
Program Year: 2023
Assistance Listing Number: 84.282
Compliance: Activities Allowed and Unallowed and ProcurementFinding Type: Significant deficiency in internal controls and on internal controls over compliance.
Criteria: Management is responsible for maintaining adequate records for vendor transactions charged to
federal awards that accurately reflect expenses. These records must include an invoice with a signature
from a knowledgeable and authorized individual approving the expense.
Condition: During control and compliance testing, it was noted that approvals for vendor expenses charged
to the federal award were not retained.
Context: Of the 60 occurrences tested, 55 were missing any type of approval support.
Cause of condition: The School received a large, one-time, federal grant in the current year. Prior to this the
School rarely received any large dollar federal grants. The internal control of the School functions such
that staff fill out an online request form which was sent to the head of school for review. She then sent the
request to the (former) business manager to make the purchase. The sent approval was not retained.
Effect of condition: As a result of this condition, the School’s vendor expenditures charged to the federal
grant lacked adequate control and compliance documentation.
Recommendation: It is recommended that the School maintain adequate records for expenditures charged to
federal awards, such as an invoice with clear approval and documentation that the expense should be
appropriately charged to the grant.
View of Responsible Officials and Planned Corrective Action: In May of 2023, the school implemented a dual
approval for expenses. Expense requests are submitted in writing and signed by the Head of School. These
requests are saved. There is an additional approval that happens in the payment system, BILL.
Planned Implementation Date of Corrective Action: May of 2023.
Person Responsible for Corrective Action: Sarah Arnold, Head of School