Finding 964994 (2023-004)

Material Weakness
Requirement
E
Questioned Costs
-
Year
2023
Accepted
2024-03-29

AI Summary

  • Core Issue: The School Corporation lacks a proper system of internal controls, leading to potential noncompliance with Title I eligibility requirements.
  • Impacted Requirements: Failure to maintain accurate enrollment and poverty data affects compliance with federal regulations, risking future funding.
  • Recommended Follow-Up: Management should implement a robust internal control system and ensure Real Time reports are properly maintained for audit purposes.

Finding Text

FINDING 2023-004 Subject: Title I Grants to Local Educational Agencies - Eligibility Federal Agency: Department of Education Federal Program: Title I Grants to Local Educational Agencies Assistance Listings Number: 84.010 Federal Award Numbers and Years (or Other Identifying Numbers): S010A190014, S010A200014, S010A210014, S010A220014 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Eligibility Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance related to the Eligibility compliance requirement. INDIANA STATE BOARD OF ACCOUNTS 19 CROTHERSVILLE COMMUNITY SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Eligibility for Title I is determined on the Eligible School Summary of the Tile I application. Enrollment and Poverty numbers are automatically pulled from the Indiana Department of Education's (IDOE) Official Pupil Enrollment (PE) count for each school into the Eligible School Summary page of the Title I application. These counts that are pre-populated should be based on the School Corporation's records as of October of the prior fiscal year. One person compiled and uploaded enrollment data, including poverty status for Real Time reports, to the IDOE without a documented oversight or review process to ensure that the information was accurate. In addition, there was no review by the School Corporation of the enrollment and poverty counts that were pre-populated into the School Corporation's Title I grant application. The IDOE used the October 1 Real Time (RT) reports for fiscal years 2020-2021 and 2021-2022, as provided by the School Corporation, to determine Title I Eligibility for the 2021-2022 and 2022-2023 grant programs, respectively. The October 1 Real Time report could not be presented for audit for either 2020-2021 or 2021-2022, which would have been used to populate enrollment and poverty information for the 2021-2022 and 2022-2023 grants, respectively. As such, we were unable to verify the amounts reported in the grant application. Additionally, we were unable to verify if the correct socioeconomic status was properly reported for any of the students. The lack of internal controls and failure to maintain and provide adequate documentation were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the 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. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.334 states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 34 CFR 200.78(a)(1) states: "After reserving funds, as applicable, under § 200.77, including funds for equitable services for private school students, their teachers, and their families, an LEA must allocate funds under this subpart to school attendance areas and schools, identified as eligible and selected to participate under section 1113(a) or (b) of the ESEA, in rank order on the basis of the total number of public school children from low-income families in each area or school." INDIANA STATE BOARD OF ACCOUNTS 20 CROTHERSVILLE COMMUNITY SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause A proper system of internal controls was not designed by management of the School Corporation, which would include segregation of key functions. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, Real Time reports were not maintained for audit, and, as such, we could not determine if the School Corporation complied with the eligibility compliance requirements. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure Real Time reports are maintained for audit. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

Categories

Internal Control / Segregation of Duties Subrecipient Monitoring Matching / Level of Effort / Earmarking Eligibility Material Weakness

Other Findings in this Audit

  • 388549 2023-003
    Material Weakness
  • 388550 2023-003
    Material Weakness
  • 388551 2023-004
    Material Weakness
  • 388552 2023-004
    Material Weakness
  • 388553 2023-005
    Material Weakness
  • 388554 2023-005
    Material Weakness
  • 388555 2023-006
    Material Weakness
  • 388556 2023-006
    Material Weakness
  • 388557 2023-007
    Material Weakness
  • 388558 2023-007
    Material Weakness
  • 388559 2023-008
    Material Weakness
  • 388560 2023-008
    Material Weakness
  • 388561 2023-009
    Material Weakness
  • 388562 2023-010
    Material Weakness
  • 388563 2023-010
    Material Weakness
  • 388564 2023-010
    Material Weakness
  • 388565 2023-010
    Material Weakness
  • 964991 2023-003
    Material Weakness
  • 964992 2023-003
    Material Weakness
  • 964993 2023-004
    Material Weakness
  • 964995 2023-005
    Material Weakness
  • 964996 2023-005
    Material Weakness
  • 964997 2023-006
    Material Weakness
  • 964998 2023-006
    Material Weakness
  • 964999 2023-007
    Material Weakness
  • 965000 2023-007
    Material Weakness
  • 965001 2023-008
    Material Weakness
  • 965002 2023-008
    Material Weakness
  • 965003 2023-009
    Material Weakness
  • 965004 2023-010
    Material Weakness
  • 965005 2023-010
    Material Weakness
  • 965006 2023-010
    Material Weakness
  • 965007 2023-010
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
10.555 National School Lunch Program 2023 $234,104
10.555 National School Lunch Program 2022 $218,463
84.425 Education Stabilization Fund 2023 $164,854
84.027 Special Education_grants to States 2023 $157,759
84.027 Special Education_grants to States 2022 $127,468
84.010 Title I Grants to Local Educational Agencies 2022 $108,294
84.010 Title I Grants to Local Educational Agencies 2023 $90,526
10.553 School Breakfast Program 2022 $48,228
10.553 School Breakfast Program 2023 $46,815
84.358 Rural Education 2022 $35,857
84.425 Education Stabilization Fund 2022 $34,731
84.358 Rural Education 2023 $34,498
84.287 Twenty-First Century Community Learning Centers 2022 $30,071
84.367 Improving Teacher Quality State Grants 2023 $16,376
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) 2022 $12,840
84.173 Special Education_preschool Grants 2023 $5,514
84.173 Special Education_preschool Grants 2022 $4,599
10.649 Pandemic Ebt Administrative Costs 2023 $628
10.649 Pandemic Ebt Administrative Costs 2022 $614