Finding Text
U. S. DEPARTMENT OF EDUCATION PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION TITLE I GRANTS TO LOCAL EDUCATIONAL AGENCIES - AL NUMBER 84.010A PASS-THROUGH NUMBER 6201 AUDIT PERIOD - YEAR ENDED JUNE 30, 2022 Criteria or specific requirement: Office of Management and Budget (OMB) 2 CFR part 200, subpart E - Cost Principles establish principles for determining the allowable costs incurred by the District under Federal awards. Such costs are to be necessary and reasonable for the performance of the Federal Award and be adequately documented. Condition: The District paid three vendors for professional and consulting services before services were rendered. These vendors were paid $269,600, $186,400, and $36,800, respectively, from Title I federal awards. Cause: Lack of internal controls and management oversight over program expenditures. Effect or potential effect: Unallowable costs were paid from the Title I program for professional and consultant services. Questioned costs: The amount of questioned costs was unable to be determined. Context: An examination of contracts totaling $492,800 for professional and consulting services. Recommendation: The District should contact the Arkansas Division of Elementary and Secondary Education for guidance regarding this matter and implement proper controls over program expenditures. Views of responsible officials: All services prepaid were rendered and properly documented, i.e., sign in sheets and agendas. It should be noted that the district believes it received approval from the pass-through entity to prepay based on verbal and email guidance of the Public-School Program Manager from DESE public school accountability department. The purpose of prepayment was to avoid returning funds as advised. (Email Documentation can be provided) In addition, Solution Tree, a state approved partner, sent an email as recently as April 3, 2023 outlining districts options to "Pre-pay years of PD with federal funds". (Documentation can be provided). While Solution Tree is not the pass-through agency it is a highly recommended partner for professional development in the state. As a result, the district is scheduled to meet with DESE prior to the publishing of the audit given a final determination must be made by DESE. However, the district will review payments to vendors in the future to ensure that services have been rendered prior to payment regardless of additional guidance.