Finding Text
2022-005 - Education Stabilization Fund - Elementary and Secondary School Emergency Relief Fund - Assistance Listing No. 84.425D and ARP Elementary and Secondary School Emergency Relief Fund - Assistance Listing No. 84.425U; Grant Period - For the year ended June 30, 2022 Condition: The internal controls over the federal expense approval process were not operating properly. As a result, we were unable to review approval for a selection of expenses claimed as part of the Education Stabilization Funds. Criteria: The District's policy is to have a purchase order signed by the Business Manager for all purchases. For invoices paid with a check, the District's policy is to have three authorized check signors which provides approval for payment. For all other types of payment, the District's policy is inconsistent for expense approval. Proper functioning internal controls would result in the District having consistent control procedures in place for expense approval. Cause: The system of controls over the Education Stabilization Fund did not operate properly to allow for the District to provide evidence of both the purchase order approval and the disbursement approval for 8 of 10 items selected for testing as part of the allowable cost testwork performed. Effect: The District was unable to provide documentation to verify these federal expenditures were approved. Context: A sample of 10 expenditures totaling $360,908 was selected for testing from a population of 44 expenditures totaling $878,544. We were unable to review a signed purchase order for 5 of 10 expenditures selected for testing. The District did not have a consistent method for approval of expenditures and therefore we were unable to review signed expense approval for 7 of 10 expenditures. For 1 of 10 items selected for testing, we were unable to review any form of supporting documentation and therefore is considered a questioned cost totaling $8,527. Recommendation: The District's internal control system should be modified to document approval of all federal expenditures. Views of Responsible Officials and Planned Corrective Actions: Going forward, all expenses will have an invoice, PO, Requisition, and any other supporting documentation with the check stub for each purchase on file for 7 years.