Finding Text
Condition and Criteria: The Michigan Department of Education (MDE) requires that Local Education Agency's (LEA’s) report their final expenditures upon completion of a grant, and that those records agree with the LEA's detailed records and that the allocation of costs within the report are appropriate. MDE further requires that any expenditures that are over an approved amount by more than 10% obtain an approved budget amendment. When the ESSER I Final Expenditure Report (FER) was filed, various amounts by function and object code exceeded the final approved budget by more than 10%. Effect: The District has questioned costs for the portions of their FER exceeding 10% of the approved budget. Cause: Some misclassifications were found throughout the audit testing which could imply that these excess costs are in fact included in the approved budget but simply misclassified. However, we are unable to verify that, and must consider these excess costs as unallowable. Context: The FER and all final trial balances for the fiscal years included in the grant were reviewed and evaluated in total. Only the ESSER I FER included overages over 10%. Questioned Costs: $345,536 Auditors' Recommendation: We recommend that the business office closely compare all FERs with not only their final trial balances, but also with their final approved budgets to ensure that all amounts agree and do not exceed more than 10% of the budget, prior to finalizing the FER in the NexSys System. Views of Responsible Officials and Planned Corrective Actions: The District understands the situation and will ensure this happens moving forward. Please see the attached Corrective Action Plan prepared by the District.