FAC Explorer

Finding 623324 (2022-001)

Material Weakness Repeat Finding
Requirement
AB
Questioned Costs
$1
Year
2022
Accepted
2022-12-19
Audit: 45922
Organization: Los Angeles Unified School District (CA)
Auditor: Simpson and Simpson LLP

AI Summary

  • Core Issue: Payroll records for federal programs showed discrepancies between reported hours and actual hours in SAP, leading to both overstatements and understatements of expenditures.
  • Impacted Requirements: Compliance with 2 CFR section 200.430(i) and LAUSD Policy Bulletin 2643.11 regarding accurate documentation and timely certifications for employees funded by federal programs.
  • Recommended Follow-Up: Implement a review process to ensure accurate reporting of hours and timely completion of certifications to prevent future discrepancies.

Finding Text

Program Identification Finding Reference Number: F-2022-001 Federal Program Title, Awarding Agency, Pass-Through Entity, Assistance Listing Number, and Award Number: Supporting Effective Instruction State Grant (Title II, Part A of the ESEA), U.S. Department of Education, Passed through the California Department of Education, AL No. 84.367, PCA No. 14341 (Material Weakness) Elementary and Secondary School Emergency Relief Fund, U.S. Department of Education, Passed through the California Department of Education, AL No. 84.425D, PCA No. 15547 (Material Weakness) Compliance Requirement: Activities Allowed or Unallowed and Allowable Costs/Cost Principles State Audit Guide Finding Code: 30000 and 50000 Criteria 2 CFR section 200.430(i), Standards for Documentation of Personnel Expenses, requires: (1) ?Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non- Federal entity, not exceeding 100% of compensated activities; (iv) Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity's written policy; (v) Comply with the established accounting policies and practices of the non-Federal entity; (vi) [Reserved] (vii) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non- Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.? In accordance with LAUSD Policy Bulletin 2643.11 entitled, ?Documentation for Employees Paid from Federal and State Categorical Programs,? the Periodic Certification (formerly referred to as Semi-Annual Certifications) must be completed each fiscal year for employees whose compensation is singularly sourced from Federal funds. The first Periodic Certification covers the period between July 1st through December 31st, and the second Periodic Certification covers the period between January 1st through June 30th. These certifications should be completed no later than January 31st and July 31st, respectively. Employees whose compensation is sourced by a combination of Federal or State funds that are not a Single Cost Objective are required to complete and sign the Multi-Funded Time Report at the end of each month. Condition As part of our compliance review over payroll expenditures, we selected samples of payroll expenditures charged to the program and reviewed the supporting documents to ascertain if they were allowable per program regulations, accurately charged to the program, and appropriately supported in accordance with 2 CFR section 200.430(i) and LAUSD Policy Bulletin 2643.11. Supporting Effective Instruction State Grants (Title II, Part A of the ESEA): In our sample of sixty (60) payroll expenditures, we noted that five (5) employees provided the signed Multi-Funded Time Reports; however, the hours reported on the Multi-Funded Time Reports did not support the hours recorded in SAP. For four (4) of the five (5) employees, the hours reported on the Multi-Funded Time Reports were less than the hours recorded in SAP, leading to an overstatement of program expenditures. For one (1) of the five (5) employees, the hours reported on the Muti-Funded Report were greater than the hours recorded in SAP, leading to an understatement of program expenditures. In addition, we noted that one (1) employee provided a signed Periodic Certification that was signed subsequent to our request. Total exceptions for overstatement and understatement amounted to $4,906 and $683, respectively, of the $208,524 sampled from $14,281,515 of the total payroll expenditures. Total exceptions for untimely certifications amounted to $274. Elementary and Secondary School Emergency Relief Fund: In our sample of sixty (60) payroll expenditures, we noted that three (3) employees provided the timesheets; however, the hours reported on the timesheets did not support the hours recorded in SAP. For one (1) of the three (3) employees, the hours reported on the timesheet were less than the hours recorded in SAP, leading to an overstatement of program expenditures. For two (2) of the three (3) employees, the hours reported on the timesheets were greater than the hours recorded in SAP, leading to an understatement of program expenditures. In addition, we noted that one (1) employee provided a signed Periodic Certification that was signed subsequent to our request. Total exceptions for overstatement and understatement amounted to $820 and $350, respectively, of the $223,777 sampled from $487,522,973 of the total payroll expenditures. Total exceptions for untimely certifications amounted to $1,482. Our samples were statistically valid samples. Cause and Effect The untimely certifications appear to be incidents in which employees did not follow the District?s policies and procedures. The discrepancies between the time reports/timesheets and the SAP data appear to be due to clerical errors and lack of sufficient review. Questioned Costs The total costs related to the conditions mentioned above amounted to the following: Supporting Effective Instruction State Grants (Title II, Part A of the ESEA) (Assistance Listing No. 84.367): $4,906 overstatement and $683 understatement due to unsupported hours charged. Elementary and Secondary School Emergency Relief Fund (Assistance Listing No. 84.425D): $820 overstatement and $350 understatement due to unsupported hours charged. There were no questioned costs due to untimely completed/signed Periodic Certifications because payroll costs incurred were allowable costs for the programs. Repeat Finding This finding is a repeat finding as indicated in the Status of Prior Audit Findings and Recommendation as finding number F-2021-001. Recommendation We recommend that the District enhance its internal controls over payroll expenditures and the related compliance requirements by providing adequate and continuous training to school administrators, timekeepers, and supervisors on the required procedures to ensure the ongoing compliance requirements are being monitored. We also recommend that management responsible for each grant design and implement controls to review and approve the Multi-Funded Time Reports or timesheets prior to submission to the funding agency, and the review and approval are documented. View of Responsible Officials and Corrective Action Plan 1) Accounting Controls team will continue to coordinate with Central Office/program coordinators to: a) communicate the impact of questioned cost resulting from current year?s audit findings b) follow through on the sample testing performed on payroll documentations as a secondary control twice a year; and c) provide feedback and training to the schools based on the result of sample testing 2) Accounting Controls team will coordinate with the MyPLN team regarding the implementation of the annual Mandatory Time & Effort Training. This is a required 30-minute training of administrators, timekeepers, and supervisors with review questions at the end of the course, and requires a 100% correct answers before a certificate of completion will be issued. Name: Timothy Rosnick Title: Deputy Controller Telephone: (213) 241 -7989

Categories

Questioned Costs Allowable Costs / Cost Principles

Other Findings in this Audit

  • 46865 2022-003
    Significant Deficiency Repeat
  • 46866 2022-003
    Significant Deficiency Repeat
  • 46867 2022-003
    Significant Deficiency Repeat
  • 46868 2022-003
    Significant Deficiency Repeat
  • 46869 2022-003
    Significant Deficiency Repeat
  • 46870 2022-003
    Significant Deficiency Repeat
  • 46871 2022-003
    Significant Deficiency Repeat
  • 46872 2022-003
    Significant Deficiency Repeat
  • 46873 2022-003
    Significant Deficiency Repeat
  • 46874 2022-004
    Significant Deficiency
  • 46875 2022-005
    Material Weakness
  • 46876 2022-005
    Material Weakness
  • 46877 2022-005
    Material Weakness
  • 46878 2022-002
    Material Weakness Repeat
  • 46879 2022-002
    Material Weakness Repeat
  • 46880 2022-002
    Material Weakness Repeat
  • 46881 2022-002
    Material Weakness Repeat
  • 46882 2022-001
    Material Weakness Repeat
  • 46883 2022-001
    Material Weakness Repeat
  • 623307 2022-003
    Significant Deficiency Repeat
  • 623308 2022-003
    Significant Deficiency Repeat
  • 623309 2022-003
    Significant Deficiency Repeat
  • 623310 2022-003
    Significant Deficiency Repeat
  • 623311 2022-003
    Significant Deficiency Repeat
  • 623312 2022-003
    Significant Deficiency Repeat
  • 623313 2022-003
    Significant Deficiency Repeat
  • 623314 2022-003
    Significant Deficiency Repeat
  • 623315 2022-003
    Significant Deficiency Repeat
  • 623316 2022-004
    Significant Deficiency
  • 623317 2022-005
    Material Weakness
  • 623318 2022-005
    Material Weakness
  • 623319 2022-005
    Material Weakness
  • 623320 2022-002
    Material Weakness Repeat
  • 623321 2022-002
    Material Weakness Repeat
  • 623322 2022-002
    Material Weakness Repeat
  • 623323 2022-002
    Material Weakness Repeat
  • 623325 2022-001
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
84.425 Covid-19 Elementary and Secondary School Emergency Relief (esser Ii) Fund $693.06M
84.425 Covid-19 American Rescue Plan Act (arp Act) Esser III Fund $392.28M
84.010 Every Student Succeeds Act (essa), Title I Part A Basic $331.33M
10.555 Child Nutrition School Programs Lunch $176.59M
10.558 Child Nutrition Child Care Food Program (ccfp) Claims $142.65M
84.027 Special Ed: Idea Basic Local Assistance Entitlement $110.06M
93.323 Covid-19 Epidemiology and Laboratory Capacity for Infectious Diseases (elc), School Based Covid-19 Testing $75.04M
10.553 Child Nutrition School Programs Breakfast $68.41M
84.425 Covid-19 Expanded Learning Opportunities (elo) Esser II Fund State Reserve $54.21M
10.559 Child Nutrition Summer Food Services Program Operations $28.67M
84.424 Essa Title Iv, Part A, Student Support and Academic Enrichment Grant Program $28.22M
84.367 Essa Title Ii, Part A, Supporting Effective Instruction $26.51M
32.009 Emergency Connectivity Fund Program $25.91M
10.555 Donated Food Commodities $24.70M
10.555 Covid-19 Child Nutrition School Nutrition Program (snp) Emergency Operational Costs Reimbursement (ecr) $13.30M
84.027 Special Ed: Individual with Disabilities Education (idea) Local Assistance, Part B, Sec.611 Early Intervening Services $13.17M
10.558 Child Nutrition Child Care Food Program - Cash in Lieu of Commodities $9.73M
84.334 Gaining Early Awareness and Readiness for Undergraduate Programs $9.37M
84.365 Title III English Learner Student $8.95M
84.002 Wioa - Adult Basic Ed/ela $8.66M
84.425 Covid-19 Governor's Emergency Education Relief (geer) Fund: Learning Loss Mitigation $7.11M
10.558 Covid-19 Child Nutrition Child and Adult Care Food Program (cacfp) Ecr $6.87M
84.027 Special Ed: Idea Mental Health Allocation Plan $6.53M
84.010 Essa, Comprehensive Support & Improvement (csi) $6.08M
84.048 Carl D. Perkins - Secondary Program, Sec131 $6.00M
84.173 Idea Preschool Expansion Grant $5.09M
84.002 Wioa - Ad Ed & Fam Lit/el - Civics $4.88M
84.425 Covid-19 Esser Fund California Community Schools Partnership Program $4.59M
84.002 Wioa - Adult Secondary Ed $3.72M
93.575 Covid-19 Child Development: Coronavirus Response and Relief Supplemental Appropriations (crrsa) Act - One Time Stipend $3.54M
84.425 Covid-19 Elo Grant Geer II $3.18M
93.596 General Child Care Center - Mandatory & Matching Fund $3.06M
84.425 Covid-19 Esser Fund $2.51M
97.039 Hazard Mitigation Grant Program $2.22M
84.126 Rehab- Transition Partnership Program/trans Part - Greater La $2.04M
12.U00 Reserve Officer Training Corps Vitalization Act $1.87M
84.048 Carl D. Perkins - Vocational and Technical Education, Sec 132 $1.74M
84.027 Special Ed: Idea Local Assistance, Private School Isps $1.68M
93.575 General Child Care Center - Block Grant $1.41M
84.377 School Improvement Grants $1.28M
84.173 Special Ed: Idea - Part B, Sec 619; Preschool Grants Early $1.23M
84.010 Essa, Title I Part A. Neglected $1.18M
84.181 Special Education-Grants for Infants and Families: Early Intervention Funds - Part C $1.17M
17.259 Wioa - T-1 Youth Source System $1.07M
93.505 Affordable Care Act (aca) Maternal, Infant, and Early Childhood Home Visiting Program $1.02M
84.011 Title I - Migrant Ed - Regular $874,537
10.559 Child Nutrition Summer Food Services Program Sponsor Administration $756,231
84.173 Special Ed: Idea - Part B, Sec 619; Preschool Grants Early Intervening Services $708,178
84.365 Title III Immigrant Student $507,829
84.425 Covid-19 Twenty-First Century Learning Centers Rate Increase Elementary and Secondary School Emergency Relief (esser Iii) State Reserve After School Programs $492,444
93.079 Cdcp - School Based Hiv/std Prevention $455,922
84.425 Covid-19 Arp Act - Homeless Children and Youth (arp-Hcy) Program $310,076
84.196 Education for Homeless Children & Youth $301,288
84.287 Twenty-First Century Community Learning Centers $299,829
93.600 Early Head Start $289,157
84.305 Air Credit Recovery $209,681
84.011 Title I - Migrant Ed - Summer $208,189
84.425 Covid-19 Coronavirus Aid, Relief, and Economic Security (cares) Act Esser Child Nutrition $207,015
93.994 Child Health Outreach Initiative - Whole Person Care $177,470
84.060 Indian Education $115,847
17.259 Wioa Youth $102,000
93.575 Cctr Programs Administered by California Department of Social Services $99,736
17.258 Workforce Innovation and Opportunity Act (wioa) - Worksource Educational Partnership - Adult $90,279
20.205 Highway Planning and Construction: Active Transportation Program $86,843
84.027 Special Ed: Idea - Supporting Inclusive Practices, Part B - Sec 611 $83,799
17.278 Wioa - Worksource Educational Partnership - Dislocated Workers $71,974
17.245 Employment Development Department Trade Act: Trade Adjustment Assistance (taa) $71,300
84.027 Special Ed: Idea - Alternate Dispute Resolution, Part B - Sec 611 $69,986
84.365 National Professional Development Grant, Project Royal $65,295
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) Tick Fire $49,003
93.566 California Department of Social Services Refugee Program Bureau $47,687
47.076 Usc - Math for America Los Angeles $47,577
10.665 Forest Reserve $42,851
12.900 Startalk: Exploring Arabic Through Technology, Startalk - Lausd $39,063
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) Getty Fire $34,567
84.011 Title I - Migrant Ed - School Readiness $32,656
84.010 Essa, Title I Part D. Delinquent $30,919
84.173 Preschool Expansion - Staff Development $26,402
84.365 Loyola Marymount University (lmu) Purposeful Engagement in Academic Rigor and Language Learning (pearll) Project $26,382
93.558 County Youth Jobs Program - Calworks $13,999
84.411 Wested Federal Investing in Innovation and Improvement Program I3 Grant $13,058
84.173 Special Ed: Idea - Preschool Capacity Building, Part B - Sec 619 2020-21 Embedded Instruction $9,504
10.649 Pandemic Electronic Benefit Transfer (ebt) Administrative Grant $5,814
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $4,527
10.574 Child Nutrition Team Nutrition Grants $3,893
94.014 Youth Service America Corporation $3,601
93.719 Arra - State Grants to Promote Health Information Technology $842
93.079 Youth Risk Behavior Survey Participation $500
16.839 Stop School Violence $421
93.575 Covid-19 Cares Act General Child Care and Development (cctr) $118