Finding 586151 (2023-002)

Condition: Stipends for four business office employees were paid out of the grant totaling $13,500 during the current year. The approved grant budget (FS-10) was not amended for the correct number of FTEs and total amount of the stipends paid. Therefore, the stipends paid exceeded the amount budgeted for by $1,500. In addition, documentation of Board approval for any stipends paid from Federal grants during the year could not be located upon request during the audit. Questioned Cost: N/A Criteria: NYSED requires School Districts to submit FS-10 Budget forms for Federal grants to ensure expenditures have prior approval of NYSED. The budget should be amended as needed using a form FS-10A. In addition, employee stipends should be approved by the Board prior to payment, and evidence of approval should be documented. Cause: Established controls and procedures did not ensure that the stipends were properly budgeted for and approved. Effect: Expenditures were paid out of the grant that were not properly budgeted for and approved. Recommendation: We recommend that management implement a process to ensure that the grant budgets and other reporting is proper and complete. The process should include procedures to amend grant budgets as needed. We also recommend that management revise its payroll procedures to ensure that all stipends are approved by the Board prior to payment. Evidence of Board approval should be maintained in the personnel files.