Finding Text
U.S. DEPARTMENT OF EDUCATION
PASSED THROUGH ARKANSAS DEPARTMENT OF EDUCATION
COVID-19 ELEMENTARY AND SECONDARY SCHOOL EMERGENCY RELIEF FUND - AL NUMBER 84.425D
PASS THROUGH NUMBER 7104
AUDIT PERIOD - YEAR ENDED JUNE 30, 2023
2023-001. Allowable Costs/Cost Principles
Criteria or specific requirement: Purchases of equipment and other capital expenditures require the written approval of the Federal awarding agency or pass-through entity, as specified in Office of Management and Budget (OMB) 2 CFR section 200.439.
Condition: In our test of expenditures from the COVID-19 Education Stabilization Fund, we identified an equipment purchase with a unit cost greater than the $5,000 threshold for which the District did not obtain prior written approval from the Arkansas Division of Elementary and Secondary Education (DESE). The equipment had a cost of $30,967.
Cause: Lack of internal controls and management oversight over program expenditures.
Effect or potential effect: Unallowable costs of $30,967 were paid from the COVID-19 Education Stabilization Fund.
Questioned costs: The amount of questioned costs was $30,967.
Context: As a result of an examination of 4 checks (totaling $139,550) from a population of 23 checks (totaling $268,217). Our sample was statistically valid.
Identification as a repeat finding: No
Recommendation: The District should contact the Arkansas Division of Elementary and Secondary Education for guidance regarding this matter and implement proper controls over program expenditures.
Views of responsible officials: The timeline for prior approval and ordering of the piece of equipment referenced above happened prior to the new administration coming into the District. However, as Superintendent of the District, I should have double checked to ensure that the correct protocol was followed. Since being in this role, every item the District has purchased using the COVID-19 Education Stabilization Fund has documented prior approval and will continue to do so until the end of these funds.