Finding Text
Condition: Written procedures do not specifically address federal funds or the use thereof. Criteria: Compliance requirements for Activities Allowed or Unallowed and Allowable Costs state that the Organization must have written polices and control procedures for costs coded to federal awards. Cause: The United Community Schools, Inc. (?UCS?) and its parent organization, the United Federation of Teachers (?UFT?), negotiated a contract with the New York City Board of Education (?NYC BOE?) with the understanding that the funding was city funding. During the 2019 audit (the first year of the program), the NYC BOE disclosed to the auditors that the funding was, in fact, federal. Because of the late notification, UCS did not have sufficient time to update its written policies and procedures to include treatment of federal funds. Effect: Noncompliance with Uniform Guidance requirements may make UCS ineligible for reimbursement of current year expenditures and for future federal funding. Recommendation: Update UCS and UFT policies and procedures manuals to address the treatment of federal funds.