Finding 564649 (2024-002)

Assistance Listing Number(s): 84.425V Name of Federal Program or Cluster: COVID-19 Education Stabilization Fund (ESF), American Rescue Plan – Emergency Assistance to Non-Public Schools (ARP EANS) Name of Federal Agency: Department of Education Federal Award Identification Number: S425V210042 Federal Award Date: February 26, 2021 and September 24, 2021 Name of Pass-through Entity: State of North Carolina Pass-through Entity Identifying Number: 60-04 and 60-05 Award Period: July 1, 2022 through September 30, 2023 and July 1, 2022 through September 30, 2024 Criteria: Uniform Guidance 2 CFR 200.430 requires charges to federal awards for compensation must be based on records that accurately reflect the work performed. Condition: 2 out of a total of 11 employees’ compensation and benefits charged to the federal award for the fiscal year were not supported by time and effort documentation. 13 out of the total 43 quarterly compensation and benefits charged were greater than the amount supported by the time and effort documentation. A total of $278,803 of personnel and fringe were charged to the federal award. Cause: Budgeted amounts were used, but no system of review and adjustments to actual were performed. A written policy and procedures over documenting time and effort was not designed and implemented. Effect or Potential Effect: Unsupported compensation and benefits charged to the program may be disallowed. Questioned Costs: $21,249 for the compensation costs and related employee benefits charged for the 2 employees that were not supported by time and effort documentation. $20,472 for the 13 quarterly compensation and related benefits that were greater than the time and effort documentation supported. Context: For the audit all employees whose compensation and benefits were charged to the federal award retroactively provided signed quarterly time and effort documentation. These documentations were reviewed and approved by their supervisors. Auditor viewed all 11 employees quarterly time and effort documentation. While there were 13 quarterly compensation and benefits charges that were greater than the amount supported, there were 14 quarterly compensation and benefits that were undercharged by $35,871. Repeat Finding: No Recommendation: Time and effort documentation be documented per Uniform Guidance requirements and used to review and adjust budgeted compensation and benefit costs charged to the award to be accurate, allowable, and properly allocated. Written policies and procedures should be designed and implemented for documentation of time and effort. Views of Responsible Officials: The organization agrees with the finding.