Finding Text
CONDITION:
Education Stabilization Funds were used for capital expenditures without obtaining prior approval from the pass-through entity, the Pennsylvania Department of Education (PDE).
CRITERIA:
In accordance with the Uniform Grant Guidance, United States Department of Education, Education Stabilization Fund, Part III, Section F., “Equipment/Real Property Management,” with prior approval by the pass-through entity, subrecipients may use Education Stabilization Funds for improvements to buildings or for equipment that meet the overall purpose of the Education Stabilization Fund program.
CAUSE:
The District personnel responsible for submitting the grant applications for Education Stabilization Funds were not aware of the requirement to obtain prior approval from PDE for improvements and equipment.
EFFECT:
The error resulted in potential unallowed costs for the amounts the District expended on building improvements and equipment.
QUESTIONED COSTS:
$127,548
PROPER PERSPECTIVE (SAMPLING):
100% of the non-payroll and benefit expenditures greater than $5,000 (federal per-unit threshold) were selected for testing. The audit sample was statistically valid.
REPEAT FINDING:
No.
RECOMMENDATION:
We recommend management contact the Pennsylvania Department of Education to inquire as to how to handle the projects not pre-approved. In addition, personnel responsible for Education Stabilization Fund programs should become familiar with the grant requirements. We further recommend the implementation of a review process by management to ensure the grants are managed correctly.
MANAGEMENT RESPONSE:
Management agrees with the recommendations and has contacted the Pennsylvania Department of Education to determine how to handle the projects not pre-approved. PDE has advised that the pre-approvals can still be obtained, and management will do the necessary paperwork to become compliant.