Finding Text
Finding No. 2023–001 - CASH MANAGEMENT
Name of Federal Agency
U.S. Department of Education Pass-through the Puerto Rico Department of Education
Federal Programs
Charter Schools
Assistance Listing Numbers
84.282
Category
Significant Deficiency
Compliance / Internal control
Compliance Requirements
Cash Management
Criteria
According to the 2 CFR 200.305(b) For recipients and subrecipients other than States, payment methods
must minimize the time elapsing between the transfer of funds from the Federal agency or the passthrough entity and the disbursement of funds by the recipient or subrecipient regardless of whether the
payment is made by electronic funds transfer or by other means.
According to the 2 CFR 200.305(b) (2)The recipient or subrecipient must be paid in advance, provided it
maintains or demonstrates the willingness to maintain both written procedures that minimize the time
elapsing between the transfer of funds and disbursement by the recipient or subrecipient, and financial
management systems that meet the standards for fund control and accountability as established in this
part. Advance payments to a recipient or subrecipient must be limited to the minimum amounts needed and
be timed with actual, immediate cash requirements of the recipient or subrecipient in carrying out the
purpose of the approved program or project.
The timing and amount of advance payments must be as close as is administratively feasible to the actual
disbursements by the recipient or subrecipient for direct program or project costs and the proportionate
share of any allowable indirect costs. The recipient or subrecipient must make timely payments to
contractors in accordance with the contract provisions.
Condition
During our audit procedures, we found the following instances on which the Institution did not disbursed
funds in an expedite matter:
Fund Sample Selected Instances Average of Days Late
84.282 11 Two (2) 10 to 15 days
Cause
The delay in disbursements responds to several situations: remote work, lack of banking or information
from suppliers, multiplicity of tasks under the responsibility of the CFO, which affected the dates of sending
the payments.
Effect
As a result of this condition, the U.S. Department of Education and /or Puerto Rico Department of
Education may issue warnings and/or impose penalties to the Institution.-34-
Questioned Cost
None
Recommendation
The management of the Institution should reinforce its cash management procedures and internal controls
to ensure the disbursement of funds in the required time frame.
Views of Responsible Officials of the Auditee
The management of the Institution agrees with this finding.
Responsible Person
Yusein Duarakov
Business Administration