Finding Text
FINDING 2022-004 Information on the federal program: Subject: Title I Grants to Local Educational Agencies - Eligibility Federal Agency: Department of Education Federal Program: Title I Grants to Local Educational Agencies Assistance Listing Number: 84.010 Federal Award Numbers and Years (or Other Identifying Numbers): S010A170014; S010A190014; S010A200014 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Eligibility Audit Finding: Material Weakness Criteria: 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)...." Condition: An internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Eligibility compliance requirement. Cause: Management had not developed a system of internal controls that would have ensured compliance with the grant agreement and the Eligibility compliance requirement. Effect: The failure to establish an effective internal control system could have enabled noncompliance with the grant agreement and the Eligibility compliance requirement. Questioned Costs: There were no questioned costs identified. Context: The School Corporation had not designed or implemented a system of internal control to ensure the poverty status of each student was accurate. The free and reduced applications were completed by parents online and the poverty status was then calculated based on the guidelines input into the system. The income guidelines were updated by the software vendor without an oversight or review process by the School Corporation to ensure the accuracy of the information. Additionally, one employee uploaded the Direct Certification reports from the state into the software system without a documented oversight or review process to ensure direct certified students were properly processed. The lack of controls was a systematic issue throughout the audit period. Identification as a repeat finding, if applicable: No Recommendation: We recommended that the School Corporation's management establish a system of internal controls to ensure compliance with the grant agreement and the Eligibility compliance Requirement. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.