Finding 58435 (2022-003)

2022 ? 003 ? Special Test and Provision ? Wage Rate Requirements Federal Agency: U.S. Department of Education Federal Program Name: Education Stabilization Fund Assistance Listing Number: 84.425 Pass-Through Agency: Arizona Department of Education Pass-Through Number(s): All Pass-Though Numbers Present in the SEFA Award Period: March 2020 through September 2024 Statistically Valid Sample: No, and not intended to be a Statistically Valid Sample. Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or specific requirement: Construction contracts are reviewed and approved by the Director of Purchasing to ensure the completeness and accuracy of the contract including the appropriate prevailing wage rate clauses are included in the contract or subcontracts. Additionally, contractor or subcontractor are required to submit required certified payroll for each week in which work was performed. Condition/Context: We noted instances where contracts did not include the prevailing wage clauses and no certified payrolls were obtained from the contractor or subcontractors. For 5 of the 6 contracts reviewed, the required prevailing wage rate clauses were not included in the contract and there were no certified payrolls submitted by the contractor or subcontractors. Questioned costs: None. Cause: The District was not aware of the error due to a lack of established processes and internal controls in these areas during the fiscal year. Effect: Noncompliance with federal grant terms and conditions including 2 CFR Part 200 Uniform Guidance over wage rate requirements. Repeat finding: No Recommendation: We recommend the District to review its current procedures over the review of contracts to ensure prevailing wage rates clauses are included in the contract and implement a monitoring control to ensure certified payrolls are submitted by the contractor or subcontractor in a timely manner as required by the regulations. Views of responsible officials: There is no disagreement with the audit finding. See corrective action plan.