Finding Text
Program Name: Education Stabilization Fund - American Rescue Plan - Elementary and Secondary School Emergency Relief Fund - CFDA #84.425U. Pass-Through Entity: Michigan Department of Education. Finding Type: Significant Deficiency in Internal Control over Compliance. Condition: Textbook and workbook orders were paid in advance and charged to the federal program for periods that extend beyond the award period. Perspective/Context: Of $2,314,999 charged to the program, $248,781 is related to expenditures for fiscal years beyond the grant period. Questioned Cost: None. Per Michigan Department of Education, the District has the ability to amend their award budget before September 30, 2024 to correct the error. Criteria: Grantees should have written policies and procedures to assure only allowable costs are charged to the federal program and all expenditures are within the grant period of availability. Cause: The District lacks oversight over federal programs to identify expenditures that extend multiple years to assure only those in the grant period are charged to the federal program. Effect: The District could be paying for goods or services with federal funds prior to receiving the goods or services. Recommendation: The District should review the current policies and procedures related to federal awards and review all related controls to identify these types of transactions before they are charged to grant programs for proper review, approval, and consideration. Management's Response: Management will work with the grants department to review current policy and procedures related to federal awards. The team will maintain controls to review grants in the planning process to ensure the plans include allowable expenditures that fall within the grant expenditure period.