Finding Text
Finding 2022-005. Allowed and Unallowed Costs. (ALN 84.425U ARP ESSER III) CRITERIA: 2 CFR 200.302 requires that a non-federal entity?s financial management systems must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions. This section further requires the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award, including a comparison of expenditures with budget amounts for each federal award. 2 CFR 200.303 requires that a non-federal entity must establish and maintain effective internal control over a federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. CONDITION: In our testing of the comparison of actual expenditures to budgeted amounts approved by the Mississippi Department of Education, we noted expenditures for the salaries and benefits for nurses exceeded approved budgeted amounts by $14,417.42. CAUSE: The school district failed to address unfavorable budgetary variances when actual expenditures exceeded approved budgeted amounts. EFFECT: The effect is both a breakdown in budgetary controls and unallowable program costs. Since these excess costs are less than $25,000.00, no costs will be questioned. QUESTIONED COSTS: None RECOMMENDATION: The district should limit expenditures to approved budgeted amounts for this grant. VIEWS OF RESPONSIBLE OFFICIALS: See the school district?s response in the auditee?s corrective action plan in this report.