Finding 625088 (2022-004)

Material Weakness
Requirement
B
Questioned Costs
$1
Year
2022
Accepted
2023-02-02
Audit: 46061
Organization: Madison District Public Schools (MI)

AI Summary

  • Core Issue: The District failed to provide adequate payroll documentation for federal program charges, leading to material noncompliance.
  • Impacted Requirements: The Uniform Guidance mandates that payroll costs must be supported by proper documentation, including timesheets for employees working on multiple projects.
  • Recommended Follow-Up: Ensure all payroll charges to federal programs are backed by allowable documentation and adhere to both federal and District policies by the completion date of June 30, 2023.

Finding Text

2022-004 - Allowable Costs/Cost Principles - Payroll Documentation Finding Type. Material Noncompliance; Material Weakness in Internal Control over Compliance Federal program(s) U.S. Department of Education: Education Stabilization Fund (ALN 84.425); Passed through MDE; All project numbers Criteria. The Uniform Guidance requires the District to support payroll charged to federal cost objectives with adequate documentation in accordance with the District's payroll policies. Per the District's federal policies, the District is required to support payroll charges to federal cost objectives with adequate documentation including personnel activity reports or timesheets for those who split their time between multiple cost objectives. Condition. The District was unable to provide evidence of allowable costs/cost principles and internal controls compliance as follows: Of the 21 payroll transactions selected for testing, the District was unable to provide documentation for eight of those charges. Of the 21 payroll transactions selected for testing, the District identified that one individual had been charged to the grant in excess of their actual payroll for the year. Cause. This condition appears to be the result of the District charging costs to federal programs that were not properly supported using allowable methods. Effect. As a result of this condition, the District does not have appropriate payroll support for nine of the transactions tested which were charged to the grant. Questioned Costs. The total charges included in our sample that were not supported by allowable documentation amounted to $129,160. Recommendation. We recommend the District limit payroll charged to federal programs to costs that are supported by documentation that is allowable under federal cost principles and its own policies and procedures. View of Responsible Officials. Management concurs Responsible Official. Director of Finance and Business Operations Estimated Completion Date. June 30, 2023

Categories

Questioned Costs Allowable Costs / Cost Principles Material Weakness

Other Findings in this Audit

  • 48645 2022-003
    Material Weakness
  • 48646 2022-004
    Material Weakness
  • 48647 2022-003
    Material Weakness
  • 48648 2022-004
    Material Weakness
  • 625087 2022-003
    Material Weakness
  • 625089 2022-003
    Material Weakness
  • 625090 2022-004
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
84.425 Education Stabilization Fund $1.16M
84.027 Special Education_grants to States $302,586
84.010 Title I Grants to Local Educational Agencies $276,931
10.553 School Breakfast Program $209,856
84.367 Improving Teacher Quality State Grants $40,753
84.424 Student Support and Academic Enrichment Program $28,431
10.555 National School Lunch Program $22,407
84.173 Special Education_preschool Grants $21,302
10.559 Summer Food Service Program for Children $17,250
84.365 English Language Acquisition State Grants $13,776
10.649 Pandemic Ebt Administrative Costs $3,063
10.558 Child and Adult Care Food Program $2,035