Town of Randolph

Finding Number: 2023-001 Federal Agency: U.S. Department of Homeland Security Cluster/Program: COVID-19 – Disaster Grants – Public Assistance (Presidentially Declared Disasters) AL Number(s): 97.036 Award Year: 2023 Compliance Requirement: Activities Allowed or Unallowed & Allowable Cost/Cost Principles Type of Finding Internal Control over Compliance - Significant Deficiency Criteria or Specific Requirement All disbursements should be supported by documented evidence to ensure expenditures are allowable under the award terms. Condition and Context It was observed that the Town did not retain signed vouchers or equivalent documentation for certain vendor and payroll disbursements. Cause An inadequacy in the internal control system designed to ensure retention of appropriate supporting evidence for expenditures. Effect or Potential Effect The effect of not retaining signed disbursement approval is the inability to demonstrate that expenditures were approved by an individual knowledgeable of the program and its requirements. This could result in disallowed costs and a potential requirement to refund money. Recommendation The Town should establish and enforce policies and procedures to require the retention of signed vouchers and supporting documentation for all invoices. Views of Responsible Official Management agrees with the finding. Planned Corrective Action Management’s corrective action plan is included at the end of this report after the Schedule of Prior Year Findings.

Finding Number: 2023-002 Federal Agency: U.S. Department of the Treasury Cluster/Program: COVID-19 – Coronavirus State and Local Fiscal Recovery Fund AL Number(s): 21.027 Award Year: 2023 Compliance Requirement: Reporting Type of Finding Compliance Internal Control over Compliance - Significant Deficiency Criteria or Specific Requirement Recipients of the ARPA SLFRF grants must adhere to the U.S. Department of the Treasury’s reporting requirements, which include the submission of accurate and timely project and expenditure reports to demonstrate compliance with the allowable use of funds and the progress of projects financed by the grant. Condition and Context It was noted that the Town did not complete the required project and expenditure reports within the stipulated deadlines for the ARPA SLFRF grant. Cause The lack of completing the required project and expenditure reports may be due to an insufficient control system to track and ensure compliance with reporting guidelines. Effect or Potential Effect The noncompliance with reporting requirements could result in the withholding of further grant payments and recovery of funds by the Federal agency. Recommendation The Town should develop a detailed reporting schedule in accordance with the Treasury’s requirements and develop personnel to oversee compliance with reporting requirements and establish an internal review process to verify the accuracy and completeness of reports before submission. Views of Responsible Official Management agrees with the finding. Planned Corrective Action Management’s corrective action plan is included at the end of this report after the Schedule of Prior Year Findings.

Finding Number: 2023-003 Federal Agency: U.S. Department of Education Cluster/Program: Supporting Effective Instruction State Grant AL Number(s): 84.367A Award Year: 2023 Compliance Requirement: Reporting Type of Finding Compliance Internal Control over Compliance – Material Weakness Criteria or Specific Requirement The Supporting Effective Instruction State Grant requires that final financial reports include all expenditures incurred during the period of performance. These reports must be accurate, complete, and adhere to the financial reporting requirements as stipulated by the grant agreement and federal regulations. Additionally, financial reports should be prepared and reviewed by different individuals to ensure proper segregation of duties. Condition and Context Upon review of the final financial reports submitted for the program, it was noted that not all expenditures incurred were included. Additionally, the reports were completed and signed by the same individual, indicating a lack of proper internal controls concerning the segregation of duties. Cause The omission of certain expenditures from the final financial report appears to be the result of an oversight or misunderstanding of reporting requirements. The completion and signing of the report by the same individual may be due to a lack of adequate staffing or a misunderstanding of reporting requirements. Effect or Potential Effect The incomplete final financial reports do not accurately reflect the total expenditures associated with the program, potentially resulting in a misrepresentation of the use of federal funds. Furthermore, the lack of segregation of duties in the reporting process increases the risk of undetected errors. Recommendation The Town should review all expenditures to ensure that they are accurately captured and reported in the final financial reports for the program. Additionally, the Town should institute a policy requiring the final financial reports be prepared and reviewed by separate individuals. Views of Responsible Official Management agrees with the finding. Planned Corrective Action Management’s corrective action plan is included at the end of this report after the Schedule of Prior Year Findings.

Finding Number: 2023-004 Federal Agency: U.S. Department of Education Cluster/Program: Education Stabilization Fund AL Number(s): 84.425 Award Year: 2023 Compliance Requirement: Equipment/Real Property Management Type of Finding Compliance Internal Control over Compliance – Significant Deficiency Criteria or Specific Requirement According to federal regulations, recipients of federal funds under the Education Stabilization Fund are required to maintain accurate records and logs for equipment purchased with such funds. These logs should include detailed information about the acquisition, use, maintenance, and disposition of the equipment. Condition and Context Upon review, it was noted that equipment logs were not maintained for equipment purchased with funds from the Education Stabilization Fund. Cause The absence of equipment logs could be attributed to lack of awareness of federal requirements. Effect or Potential Effect Failure to keep equipment logs jeopardizes the Town’s accountability for federal assets and potentially could lead to misuse or misappropriation of federally funded equipment. Recommendation The Town should initiate the process of creating and maintain detailed equipment logs for all federally funded equipment purchases and train relevant personnel on the proper procedures for equipment recordkeeping, emphasizing the importance of these logs in federal fund management. Views of Responsible Official Management agrees with the finding. Planned Corrective Action Management’s corrective action plan is included at the end of this report after the Schedule of Prior Year Findings.

2020-001 Improve Documentation and Controls Over Disbursements Process Federal Agency: U.S. Department of Agriculture Cluster: National School Lunch Cluster Federal Program Name: National School Lunch Program CFDA Number(s): 10.553/10.555/10.559 Pass-through Entity: Massachusetts Department of Elementary and Secondary Education Award Year: 2020 Compliance Requirement: Allowable Costs/Cost Principles Type of Finding Compliance Internal Control over Compliance - Material Weakness Criteria or Specific Requirement Grantees must provide reasonable assurance that Federal awards are expended only for allowa-ble activities and that the costs of goods and services charged to Federal awards are allowable and in accordance with the applicable cost principles. Management of the District is also re-sponsible for establishing and maintaining effective internal control over compliance with Fed-eral requirements that have a direct and material effect on a Federal program. A deficiency in internal control over compliance exists when the design or operation of a control over compli-ance does not allow management or employees, in the normal course of perform?ing their as-signed functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a Federal program on a timely basis. Condition and Context A sample of disbursements charged to the grant were tested for proper approval and supporting documentation in order to determine if they were in accordance with Allowable Costs/Cost Principles. As a result of the testing of vendor dis?bursements charged to the grant, we noted that none of the vendor disbursements selected contained documented approval. Cause Weaknesses in the design and operation of controls. Effect Due to the weaknesses in internal controls noted above, there is a risk that amounts charged to Federal awards could be unallowable or in accordance with applicable cost principles. Known questioned costs are reported equal to $1,171,943, which was determined based on the proportionate share of vendor disbursements (74%) of the Child Nutrition Cluster expenditures reported on the Schedule of Expenditure of Federal Awards, less the Federal Cash Assistance. Recommendation We recommend that an authorized department head sign or initial each invoice to clearly indicate approval. Views of Responsible Official and Planned Corrective Action Management?s views and corrective action plan is included at the end of this report after the summary schedule of prior year audit findings and status.

2019-001 Improve Controls and Documentation Over Eligibility ProcessFederal Program(s) InformationCluster/Program: Child Nutrition Cluster 10.553/10.555/10.559Type of FindingCompliance andInternal Control over Compliance ? Material WeaknessCriteria or Specific RequirementTo qualify for a free or reduced cost meal the child?s family must submit an application to the School Food Authority (SFA), which then must be approved (signed) and retained on file. In order to be approved the application must prove that the child?s family income and size are within the eligibility standards established by Federal guidelines.Condition and ContextWe examined applications used to determine eligibility for 25 students participating in the school?s free and reduced lunch program. The school was unable to provide docu?mented evidence indicating that at least two individuals were involved in approving eligibility for any of the applications selected. Additionally, one application was unable to be located.EffectDue to the exceptions noted above, questioned costs are reported equal to $501,021, which was determined based the entire Child Nutrition Cluster expenditures reported on the Schedule of Expenditures of Federal Awards less the Federal Cash Assistance.RecommendationWe recommend the School Department document the review of eligibility calculations for all students participating in the free or reduced lunch program and ensure that applications are retained for all students.Views of Responsible Official and Planned Corrective ActionManagement?s views and corrective action plan is included at the end of this report after the summary schedule of prior year audit findings and status.

2019-002 Improve Controls and Documentation Over Required VerificationsFederal Program(s) InformationCluster/Program: Child Nutrition Cluster 10.553/10.555/10.559Type of FindingCompliance andInternal Control over Compliance ? Significant DeficiencyCriteria or Specific RequirementBy November 15 of each school year, verification of free and reduced-price eligibility of house?hold income from a sample of approved applications must be performed. Management of the School Department is also responsible for establishing and maintaining effective internal control over compliance with Federal requirements that have a direct and material effect on a Federal program. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a Federal program on a timely basis.Condition and ContextThe School Department calculated that they were required to verify 6 applications., however, were unable to provide a report of the students verified or the income eligibility documentation that was reviewed.EffectDue to the weaknesses in internal controls noted above, there is a risk that ineligible students could receive free or reduced-price lunches. No questioned costs are reported, as it is not quantifiable.RecommendationWe recommend the School Department maintain support for applications verified to address the weaknesses in internal controls noted above in order to comply with Federal guidelines related to verification of applications for the National School Lunch Program.Views of Responsible Official and Planned Corrective ActionManagement?s views and corrective action plan is included at the end of this report after the summary schedule of prior year audit findings and status.

2019-003 Improve Controls and Documentation Over Paid Lunch Equity CalculationFederal Program(s) InformationCluster/Program: Child Nutrition Cluster 10.553/10.555/10.559Type of FindingCompliance andInternal Control over Compliance ? Significant DeficiencyCriteria or Specific RequirementA School Food Authority (SFA) participating in the National School Lunch Program is required to ensure that sufficient funds are provided to its nonprofit school food service accounts from lunches served to students not eligible for free or reduced-price meals. A SFA currently charging less for a paid lunch than the difference between the Federal reimbursement rate for such a lunch and that for a free lunch is re-quired to comply. This difference is known as ?equity.? There are two ways to meet this requirement: (a) by raising the prices charged for paid lunches; or (b) through contributions from other non-Federal sources. SFAs with an average weighted price at or above equity have already met the requirement.Management of the School Department is also responsible for establishing and maintaining effective in-ternal control over compliance with Federal requirements that have a direct and material effect on a Federal program. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of perform-ing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a Federal program on a timely basis.Condition and ContextThe School Department was unable to provide the price equity calculator or sufficient supporting documentation to determine if the School Department complied with the paid lunch equity calculations.EffectDue to the weaknesses in internal controls noted above, the School Department did not comply with paid lunch equity pricing requirements. No questioned costs reported because it was not quantifiable.RecommendationWe recommend the School Department address the weaknesses in internal controls noted above in order to comply with Federal guidelines related to paid lunch equity calculations required under the National School Lunch Program.Views of Responsible Official and Planned Corrective ActionManagement?s views and corrective action plan is included at the end of this report after the summary schedule of prior year audit findings and status.

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