Finding Text
Federal Agency: Department of Education
Federal Program: Special Education Cluster
Pass-Through Agency: Massachusetts State Department of Elementary and Secondary Education
Pass-Through Number(s): Various – See Schedule of Expenditures of Federal Awards
Assistance Listing Numbers: 84.027, 84.173
Type of Finding:
• Significant Deficiency in Internal Control Over Compliance
Compliance Requirement: Allowable Costs/Cost Principles
Criteria or specific requirement: 2 CFR, Part 200, 200.303 requires an auditee to establish and maintain effective internal controls over federal awards to ensure compliance with federal statutes, regulations and terms and conditions of the federal award. 2 CFR Part 200.403 (g) states that costs must be adequately documented to be allowable under federal awards.
Condition: The District charged costs to the program which were not properly approved.
Questioned Costs: None.
Context: For 2 of 40 transactions selected for testing, the District was unable to provide documentation of supervisory review and approval prior to issuance of payment.
Cause: The District’s procedures were not sufficient to ensure that payments were reviewed and approved prior to issuance of payment.
Effect: Unallowable costs could be charged to the program if disbursements are not reviewed by a supervisor who is knowledgeable of program regulations regarding allowable costs.
Recommendation: We recommend the District reviews and enhances its procedures and controls regarding payment processing to ensure that, prior to charging costs to the program, they are reviewed by a supervisor who is knowledgeable of the regulations regarding allowable program costs and that documentation of the review is maintained.
Views of responsible officials: There is no disagreement with the audit finding.