FAC Explorer

Finding 995903 (2022-002)

Significant Deficiency
Requirement
B
Questioned Costs
$1
Year
2022
Accepted
2023-01-05
Audit: 312232
Organization: Hagerstown Community College (MD)
Auditor: Cliftonlarsonallen LLP

AI Summary

  • Core Issue: The College improperly used HEERF grant funds to pay three executives a special payment, violating federal guidelines.
  • Impacted Requirements: Payments to senior administrators must not be funded by HEERF grants, as outlined in HEERF III guidelines.
  • Recommended Follow-Up: The College should review and strengthen procedures to ensure compliance with all grant regulations before making any payments.

Finding Text

Reference Number: 2022-002Federal Agency: U.S. Department of EducationFederal Program: Education Stabilization FundAssistance Listing Number: 84.425F, 84.425E, 84.425MAward Number and Period: P425M200011, May 5, 2020 ? June 30, 2023; P425F200021,May 4, 2020 ? June 30, 2023; P425E200504, April 22, 2020 ?May 11, 2022Compliance Requirement: Allowable Costs/Cost PrinciplesType of Finding: Significant Deficiency in Internal Controls over Compliance, Other MattersCriteria or specific requirement:Per HEERF III, FAQ Question 22 (Issued May 11, 2021), Higher Education Emergency Relief Funds (HEERF) grant funds must not be used for senior administrator or executive salaries, benefits, bonuses, contracts, incentives, stock buybacks, shareholder dividends, capital distributions, and stock options, or any other cash or other benefit for a senior administrator or executive.Condition:The College used HEERF grant funds to pay 3 executives a special payment for working in person through the pandemic.Context:As part of the review of HEERF grant funds paid to employees, CLA identified 3 executives that received a special payment.Cause:The College did not have controls in place to ensure payments made to senior administrator or executives were not funded with grants funds. Management was not aware of the specific requirement for senior administrator or executive compensation.Effect:The College made payments to executives that were not eligible to receive grant funds.Repeat Finding: NoQuestioned Costs:$23,016Recommendation:We recommend the College review current procedures to ensure all grant regulations are being followed prior to payments.Views of Responsible Officials:Management agrees with the finding.

Categories

Questioned Costs Allowable Costs / Cost Principles Significant Deficiency

Other Findings in this Audit

  • 419456 2022-002
    Significant Deficiency
  • 419457 2022-002
    Significant Deficiency
  • 419458 2022-002
    Significant Deficiency
  • 419459 2022-002
    Significant Deficiency
  • 419460 2022-002
    Significant Deficiency
  • 419461 2022-002
    Significant Deficiency
  • 419462 2022-003
    Significant Deficiency
  • 419463 2022-003
    Significant Deficiency
  • 419464 2022-003
    Significant Deficiency
  • 995898 2022-002
    Significant Deficiency
  • 995899 2022-002
    Significant Deficiency
  • 995900 2022-002
    Significant Deficiency
  • 995901 2022-002
    Significant Deficiency
  • 995902 2022-002
    Significant Deficiency
  • 995904 2022-003
    Significant Deficiency
  • 995905 2022-003
    Significant Deficiency
  • 995906 2022-003
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
84.063 Federal Pell Grant Program $4.87M
84.425 Education Stabilization Fund $4.64M
84.268 Federal Direct Student Loans $4.33M
84.047 Trio_upward Bound $271,104
84.042 Trio_student Support Services $260,110
84.048 Career and Technical Education -- Basic Grants to States $165,017
84.007 Federal Supplemental Educational Opportunity Grants $113,850
84.033 Federal Work-Study Program $93,016
84.335 Child Care Access Means Parents in School $89,941
84.002 Adult Education - Basic Grants to States $71,967
93.575 Child Care and Development Block Grant $37,086
23.002 Appalachian Area Development $32,671
45.162 Promotion of the Humanities_teaching and Learning Resources and Curriculum Development $16,667
45.149 Promotion of the Humanities_division of Preservation and Access $8,698