Finding Text
Inadequate Maintenance of Records Supporting Cash Management Process
Assistance Listing: 84.042, 84.044 and 84.047 Program Title: TRIO Cluster
Federal Agency: Department of Education
Criteria
2 CFR §200.305(b) states that “For non-Federal entities other than states, payments methods must minimize the time elapsing between the transfer of funds from the United States Treasury or the pass-through entity and the disbursement by the non-Federal entity whether the payment is made by electronic funds transfer, or issuance of redemption of checks, warrants, or payments by other means.”
Condition
The College receives funding on the reimbursement method. However, for 10 out of 40 expenses sampled (1 for Student Support Services, 4 for Talent Search and 5 for Upward), we were unable to obtain information indicating when the expenses were submitted for reimbursement and therefore could not determine that the payments were made prior to reimbursement.
In addition, for 2 out of 9 reimbursement requests tested (one for Upword Bound and one for Student Support Services) the College could not provide detail as to what expenses made up the requests. The two requests totaled $112,527 and the total requests tested totaled $282,815.
Effect
As a result of the lack of an audit trail, we were unable to determine compliance with cash management requirements for some expenses.
Cause
All exceptions occurred during the first half of the year prior to the hiring of a new Manager of Account Services.
Recommendation
We recommend that the College develop procedures to ensure that documentation supporting cash drawdowns is maintained and that all disbursements are included in a request for reimbursement.
Management’s Response
There are 10 audit findings total in calendar year 2022 and all are connected to a former staff person. In January 2023, we hired a new Manager of Account Services who immediately implemented new procedures and prepared the appropriate level of detail backup information for the TRIO reimbursements. Each reimbursement was also signed by the Controller, who verified the information and transactions before any funds were transferred. This process currently complies with cash management requirements.