Finding Text
Finding No. 2022-005 ? Internal Controls over Compliance of Federal Awards (Partial Repeat 2021-007) Federal Program Name: Twenty-First Century Community Learning Centers, Education Stabilization Funds (Elementary and Secondary School Emergency Relief (ESSER II) Fund Project Number: N/A CFDA Number: 84.287C, 84.425D, 84.425X Passed Through: Illinois State Board of Education Federal Agency: U.S. Department of Education Criteria/Specific Requirement: 2 CFR 200.303 ? Internal Controls, requires the District to establish and maintain effective internal controls over the federal awards that provide reasonable assurance that the entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal award. 2 CFR Part 2, subpart E ? Cost Principles, among other guidance states that costs charged to federal programs must be necessary and reasonable for the performance of the federal program. If a cost benefits two or more projects or activities in proportions that can be determined without undue effort or cost, the cost must be allocated to the projects based on the proportional benefit and the expenditure and/or allocation must be adequately documented. Condition: 1) During testing of compliance over disbursements, we noted the following: a. One (1) transaction that did not have indication of review or approval on the supporting documentation b. One (1) instance where the District paid sales tax in the amount of $135.71 c. One (1) instance where the District paid for a software subscription for the period 07/01/23-06/30/24, which is outside of the program period 2) During testing of compliance over reporting, we noted the following: a. One (1) instance where the expenditure report was filed five (5) days late b. Two (2) instances where the District appeared to complete the expenditure report submitted to Illinois State Board of Education from the budget versus the actual general ledger detail Questioned Costs: 1)a) $1,500.00 b) $135.71 c) $ 26,968.00 Context: 1) 3 exceptions of 47 disbursements tested The expenditure detailed in item 1(c) of the condition was completed prior to the release of the June 30, 2021 audit, when the District was made aware of the issue which was reported as finding 2021-007 in that audit. No additional expenditures outside of the grant period were noted after the date the June 30, 2021 audit was released. 2) 3 exceptions of 6 grants tested Effect: 1) The lack of proper internal controls of disbursements could result in the District paying for unallowable expenditures from the grant funds. 2) Noncompliance with grant agreement. Cause: Lack of proper oversight by District personnel. Recommendation: We recommend that the District appoint an individual that is knowledgeable, or provide the appropriate training, of the federal compliance requirements set forth in the Code of Federal Regulation to oversee the District?s federal programs to ensure the District is in compliance with all applicable federal compliance requirements. Management?s Response: The District is working to implement that the auditor?s recommendation.