Finding 588288 (2023-005)

Finding Type- Material Weakness Criteria – Secondary reviews and approval processes surrounding Title I cash management reporting and the request for reimbursement submitted to drawdown funds for this grant are a vital part of internal control that reduce the risk of administrative errors and inaccuracy of reporting Title I expenditures. Condition- - During the testing of internal controls surrounding the Title I program reporting, it was identified that review of Title 1 expenditures, final expenditure reporting, and reimbursement requests was not properly taking place. Context- The District is required to submit reimbursement requests to the Colorado Department of Education for Title I expenditures. In addition, once grants are fully spent, the District is required to complete final expenditure reports. These requests are how the District spends down Title I funds that are allocated to the District from the Colorado Department of Education. The District did not perform sufficient or document review over the reimbursement requests and final expenditure reports. Cause and Effect- Due to the lack overall review of reimbursement requests and final expenditure reports, the District had recorded approximately $343,000 in indirect costs in the general ledger related to Title I funds that was never submitted to the State for reimbursement. These costs were ultimately reclassified out of Title 1 in the general ledger as management determined not to resubmit the request for reimbursement for the year ended June 30, 2023. Recommendation -The District should implement procedures to review and document the approval of the reimbursement requests, as well as the final expenditure reports, to ensure accuracy of amounts requested for the grants are in accordance with the general ledger and budgeted amounts. View of Responsible Officials and Corrective Action Plan- While the District performs a secondary review on an AFR before submission, the District is lacking the documentation that such secondary review occurred. The District will be putting into place official documentation that a secondary review has occurred and is appropriately reviewed and signed off by the director of finance.