Finding 564606 (2024-005)

Material Weakness Repeat Finding
Requirement
B
Questioned Costs
$1
Year
2024
Accepted
2025-06-12

AI Summary

  • Core Issue: Time certifications for salaries and wages charged to the Education Stabilization program were not maintained, leading to unverified costs.
  • Impacted Requirements: This violates Title 2 U.S. CFR 200.430(g)(1)(i), which mandates proper documentation for federal fund charges.
  • Recommended Follow-Up: Implement a system to maintain time certifications, ensuring they are signed and approved, and fill the Federal Program Director position with a qualified individual.

Finding Text

Statement of condition: Time certifications that support salaries and wages charged to the Education Stabilization program were not maintained. Criteria: Title 2 U.S. Code of Federal Regulations (CFR) 200.430(g)(1)(i) requires that salaries and wages charged to federal awards must be supported by a system of internal controls that provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Cause of condition: Policies and procedures are in place which require time certifications to be maintained for all employees paid from federal funds. However, due to turnover of key personnel, these policies and procedures were not followed in the current year. Effect of condition: Without proper documentation, it cannot be verified that salaries and wages charged to the Education Stabilization program were based on actual time spent on allowable program-related activities. Context: Time certifications were not maintained for any employees paid from Education Stabilization Funds. This resulted in questioned costs of $2,548,644. Recommendation: To ensure that salaries and wages charged to federal award programs are accurate, time certifications should be maintained for all employees paid from federal funds. All time certifications should be signed by the employee and reviewed and approved by the appropriate School personnel, as evidenced by the School personnel’s signature. We also recommend that the Federal Program Director position is filled by an individual that has training and knowledge of the federal program they are administering. Views of responsible officials and planned corrective actions: Management agrees with this finding and will put procedures in place for the review and approval of time certifications.

Corrective Action Plan

Views of responsible officials and planned corrective actions: Management agrees with this finding and will put procedures in place for the review and approval of time certifications. Action Plan:  Review current staffing for employees paid with federal funds: o To ensure accurate financial reporting, the Finance Team must establish a structured filing system within Google Drive/Team Sheets under Payroll with the following structure: [FY25 / Time Certifications].  Subfolder Structure:  Semi-Annual Time Certs  Monthly Time Certs  Time Certs Internal Audit o Time Certs Internal Audit  Download the Detail Distribution Report for the current year to date.  Add a column identify the Source of Funds based on budget unit coding.  Create a Pivot Table using the Source of Funds column, employee names, and amounts.  Time Certification Requirements: Employees paid with federal funds must complete time certifications.  Less than 100% federal funded: Monthly time certification required.  100% federally funded: Semi-annual time certification required.  One-time stipend from federal funds: No time certification required, but the offer letter documenting the stipend must be saved.  Anticipated completion date of May 15, 2025, with an updated monthly review.  Create, review, and secure signatures for time certs: o All time certifications must be created, reviewed, and signed by both the employee and supervisor as soon as possible.  If a time certification is not received, a payroll redistribution will be required to move the salary out of the federal fund – this is not ideal and should be avoided. o Timely completion ensures compliance and prevents unnecessary adjustments.o Anticipated completion date of May 15,2025, with an updated monthly review.  Conduct a quarterly audit of time certifications and federally funded payroll records: o As stated above, if a time certification is not received, a payroll redistribution will be required to move the salary out of the federal fund, which is not ideal and should be avoided. o The anticipated completion date is May 20, 2025, with an updated monthly review.

Categories

Questioned Costs Internal Control / Segregation of Duties

Other Findings in this Audit

  • 564605 2024-004
    Material Weakness Repeat
  • 564607 2024-006
    Material Weakness Repeat
  • 564608 2024-007
    Significant Deficiency Repeat
  • 564609 2024-008
    Significant Deficiency Repeat
  • 564610 2024-009
    Significant Deficiency Repeat
  • 564611 2024-010
    Significant Deficiency
  • 564612 2024-011
    Significant Deficiency
  • 1141047 2024-004
    Material Weakness Repeat
  • 1141048 2024-005
    Material Weakness Repeat
  • 1141049 2024-006
    Material Weakness Repeat
  • 1141050 2024-007
    Significant Deficiency Repeat
  • 1141051 2024-008
    Significant Deficiency Repeat
  • 1141052 2024-009
    Significant Deficiency Repeat
  • 1141053 2024-010
    Significant Deficiency
  • 1141054 2024-011
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
84.425 Education Stabilization Fund $4.68M
84.010 Title I Grants to Local Educational Agencies $1.70M
10.553 School Breakfast Program $484,343
84.027 Special Education Grants to States $322,144
10.555 National School Lunch Program $50,164
84.367 Supporting Effective Instruction State Grants (formerly Improving Teacher Quality State Grants) $39,384
84.173 Special Education Preschool Grants $11,872
10.582 Fresh Fruit and Vegetable Program $1,342