Finding 621889 (2022-002)

Significant Deficiency
Requirement
AB
Questioned Costs
-
Year
2022
Accepted
2022-12-13

AI Summary

  • Core Issue: One out of fifteen transactions lacked supervisor approval before payment, indicating a control deficiency.
  • Impacted Requirements: Internal controls for expense approvals must ensure all charges to federal programs are documented and authorized.
  • Recommended Follow-Up: Implement formal approval processes and provide training on compliance to avoid future issues.

Finding Text

CONDITION: Supporting documentation for one (1) out of fifteen (15) transactions sampled did not include documentation of a supervisor?s approval prior to paying the bill and charging it to the Federal Program. CRITERIA: Internal controls over expense approvals should be in place to ensure that all expenses charged to a program are supported with appropriate documentation and approved by a member of management to ensure that the expenditure is for services provided during the fiscal year and permitted by the program. CAUSE: Informal procedures and inconsistent application of the procedures resulted in the control deficiency. EFFECT: A lack of proper approval processes related to expenses of a federal program could result in material noncompliance with federal cost principles. CONTEXT: One (1) of fifteen (15) transactions sampled resulted in a control deficiency. Further examination of additional transactions occurring within the same period did not result in any additional instances of control deficiencies. RECOMMENDATION: The School Board should implement formal and consistent processes of expense approvals. Additionally, the School Board should consider providing training to personnel of functions related to Title I reimbursements and remind them of the importance of following established procedures to ensure proper internal controls and to avoid noncompliance. MANAGEMENT?S CORRECTIVE ACTION PLAN: Once policies and procedures for individual procedures for the mentioned operations in 2022-01 above are implemented, the procedures for approval of payment should flow with more accuracy. These procedures will help to ensure proper internal controls over expense approval and help to avoid noncompliance. Detailed policies for expense approval relating to federal programs will be updated. Policies for the mentioned procedures should be completed during the fiscal year ending June 30, 2023.

Categories

Internal Control / Segregation of Duties Allowable Costs / Cost Principles Cash Management

Other Findings in this Audit

  • 45446 2022-002
    Significant Deficiency
  • 45447 2022-002
    Significant Deficiency
  • 621888 2022-002
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
10.555 National School Lunch Program $1.28M
10.553 School Breakfast Program $559,227
84.425 Education Stabilization Fund $536,518
84.367 Improving Teacher Quality State Grants $137,033
66.458 Capitalization Grants for Clean Water State Revolving Funds $125,502
84.027 Special Education_grants to States $29,968
84.048 Career and Technical Education -- Basic Grants to States $29,347
10.582 Fresh Fruit and Vegetable Program $26,768
84.173 Special Education_preschool Grants $24,090
84.374 Teacher Incentive Fund $24,000
84.010 Title I Grants to Local Educational Agencies $14,083
84.424 Student Support and Academic Enrichment Program $9,476
10.559 Summer Food Service Program for Children $4,659
93.575 Child Care and Development Block Grant $1,075