Finding 5607 (2023-004)

Federal Financial Assistance Listing 84.425U COVID‐19 Education Stabilization Fund Improper Supporting Documentation; Allowable Costs and Cost Principles Significant Deficiency in Internal Control Over Compliance Criteria – A good system of internal accounting control contemplates an adequate system for ensuring documentation of expenditures, including payroll transactions, is reviewed and maintained. Condition – During the course of our engagement, we noted one instance where employee salaries did not align with their rate of pay noted in their contract. Cause – The District does not have an internal control system designed to review and maintain documentation for expenditures, including payroll transactions. Effect – The deficiency could result in a misstatement to the financial statements that would not be prevented or detected. Questioned Costs ‐ None reported. Context/Sampling – A non‐statistical sample of 40 transaction out of a population greater than 250 total transaction were selected for testing, which accounted for $83,555 of $1,072,373 expended in program of federal program expenditures. Repeat Finding from Prior Year(s) ‐ No Recommendation – A thorough review and reconciliation of supporting documentation for expenditures, including payroll transactions, should be performed before amounts are disbursed. Supporting documentation should be maintained once review is documented and performed. View of Responsible Officials – There are no disagreements with this finding.