audit_findings: 41
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| rowid | source | report_number | finding_number | muni_id | state | entity_name | entity_type | entity_ext_id | place_geoid | match_method | auditor | report_title | audit_type | fiscal_year | period_start | period_end | published_date | finding_category | severity | questioned_cost | cost_basis | finding_title | finding_text | report_url | fetched_at |
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| 41 | wa-sao | 1021339 | 2017-001 | WA | Deer Park School District No 414 | School District | 2052 | no_match | Washington State Auditor's Office | Financial and Federal audit — Deer Park School District No 414 | Financial and Federal | 2017 | 2016-09-01 | 2017-08-31 | 2018-05-17 | federal_award_compliance | material_weakness | 0.0 | Questioned Cost Amount: $0 | The District did not have adequate internal controls to ensure compliance with federal time -and-effort and procurement requirements. CFDA Number and Title: 84.010 Title I Grants to Local Educational Agencies Federal Grantor Name: U.S. Department of Education Federal Award/Contract Number: NA Pass-through Entity Name: Office of Superintendent of Public Instruction (OSPI) Pass-through Award/Contrac | Background The District participates in the Title I program, which provides financial assistance to schools to improve the teaching and learning of children who are at risk of not meeting challenging academic standards and who reside in areas with high concentrations of children from low -income families. During school year 2016-2017, the District spent $701,988 in Title I funds for this program. Federal regulations require federal money recipients to establish and follow internal controls to ensure compliance with program requirements. These controls include knowledge of grant requirements and monitoring of program controls. Time and effort We audited the District’s internal controls over payroll to determine whether salaries and benefits charged to the grant were a dequately supported by time-and-effort documentation as required by federal regulations. Depending on the number and types of activities program employees worked, time -and-effort documentation can be a semi -annual certification or monthly personal activity reports, such as a timesheet. Washington State Auditor's Office ___________________________________________________________________________________________________________________ Procurement Grantees must use a competitive process to procure goods and services to ensure they received the best price from the lowest responsible bidder. Grantees must apply the more restrictive of federal requirements or State law by obtaining quotes or following a competitive bidding process, depending on the purchase amount. State law is more restrictive than the federal requirements for purchases exceeding $75,000, requiring the District to obtain formal bids. Federal requirements are more restrictive than state law for purchases less than $75,000. The District must obtain at least three quote s for purchases greater than $3,500 but less than $75,000, but need not apply a competitive process for “micro” purchases of $3,500 or less. Description of Condition Time and effort Our audit found the District did not obtain a semi -annual certification f or one employee who worked half-time in the program for a significant portion of the year. The District’s controls for verifying time-and-effort documentation did not include a process to check for employees charged to the program who started after the beginning of the year. We consider this internal control deficiency to be a significant deficiency. This issue was not reported as a finding in the prior audit. Procurement The District purchased curriculum and services totaling $47,487 from five vendors. We found that the District did not retain sufficient documentation to demonstrate it applied the required competitive method to award each vendor the contract for these purchases. We consider this internal control deficiency to be a material weakness. This issue was not reported as a finding in the prior audit. Washington State Auditor's Office ___________________________________________________________________________________________________________________ Cause of Condition Time and effort The District had a process in place to obtain the required time -and-effort documentation for each employee it would charge to program at the start of each school year. The District did not have a control to verify employees who started in the program after the beginning of the year had appropriate time -and-effort documentation. Because of the timing of its process, the District did not identify an employee who was hired after the start of the school year for inclusion on the semi- annual certifications list. Procurement The District staff member responsible for procurement procedures was not aware that the federal requirements were more restrictive than State law for purchases of supplies and materials less than $75,000. Effect of Condition and Questioned Costs Time and effort Without proper time -and-effort records, the District did not comply with the requirement and federal grantors cannot be assured the $11,379 of payroll costs charged to the program for one employee was accurate or valid. However, the District was able to provide alternative documentation that adequately showed the costs it charged the program were allowable. As a result, we are not questioning these costs. Procurement The District purchased $47,487 from five vendors without obtaining price quotations ranging in purchase amounts from $6,292 to $14,594. Without adequate documentation of the process it used to select the five vendors it charged to the program, the District cannot show it followed a competitive process in compliance with federal regulations. Further, the District cannot ensure it received the best possible price for equipment, supplies and services purchased under the program. Because the products and services purchased are allowable under the federal program, we are not questioning costs. Washington State Auditor's Office ___________________________________________________________________________________________________________________ Recommendation s Time and effort We recommend the District follow its own established internal control procedures to ensure it meets federal requirements for time -and-effort documentation of all employee payroll costs charged to grants. Procurement We recommend that the District establish adequate internal controls to ensure i t retains sufficient documentation to demonstrate it met federal procurement requirements for purchases of equipment, supplies and services. District ’s Response The district hired a partial FTE teacher mid -year to work second semester in the Title I program. The hiring was properly documented, but the employee name was inadvertently left off the semi-annual certification for second semester. The district has instituted a process to check against HR recor ds prior to completing the semi-annual certification. The Title I director has been made aware of federal micro -purchase requirements and has been provided a full schedule of purchasing thresholds and the associated requirements. Auditor’s Remarks We appreciate the District’s commitment to resolving the issues noted and will follow up during the next audit. Applicable Laws and Regulations The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, paragraph 11. Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements f or Federal Awards (Uniform Guidance), Section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Section 303 – Internal controls, describes the requirements for auditees to maintain internal controls over fede ral programs and comply with federal program requirements. Washington State Auditor's Office ___________________________________________________________________________________________________________________ Title 2 CFR Part 200, Section 318 - General procurement standards, describes the requirements for auditees to use its own procurement procedures, which reflect applicable Federal State, and local laws and maintain records sufficient to detail the history of procurement.. Title 2 CFR Part 200 , Section 319 – Competition, establishes all procurement transactions are to be conducted in a manner providing full and open competition, and requires non-federal entities to have written procedures for procurement transactions. Title 2 CFR Part 200 , Section 320 - Methods of procurement to be followed , describes each allowable procurement method. Office of Superintendent of Public Instruction (OSPI) Bulletin 051-11 Attachment A – Standards for Charging Employee Compensation to Federal Grants establishes requirements for documenting time and effort. Washington State Auditor's Office ___________________________________________________________________________________________________________________ | https://portal.sao.wa.gov/ReportSearch/Home/ViewReportFile?arn=1021339&isFinding=false&sp=false | 2026-07-30 13:24:54 |