Riverhead Central School District

Criteria If a school operating a schoolwide program does not consolidate federal funds with state and local funds in a consolidated schoolwide pool, an employee who works, in whole or in part, on a federal program or cost objective must document time and effort as follows: (a) For an employee who works solely on a single cost objective (e.g., a single federal program whose funds have not been consolidated or federal programs whose funds have been consolidated but not with State and local funds), an LEA is not required to maintain records reflecting the distribution of the employee’s salary and wages, including among the Federal programs included in the consolidation, if applicable. (b) For an employee who works on multiple activities or cost objectives (e.g., in part on a federal program whose funds have not been consolidated in a consolidated schoolwide pool and in part on federal programs supported with funds consolidated in a schoolwide pool or on activities that are not part of the same cost objective), an LEA must maintain time and effort distribution records in accordance with 2 CFR section 200.430(i)(1)(vii) that support the portion of time and effort dedicated to: (i) The federal program or cost objective; and (ii) Each other program or cost objective supported by consolidated federal funds or other revenue sources. Condition/Context We haphazardly sampled thirteen employees who received compensation under the Title I grant. We viewed the employee time sheet and payroll certifications and annual certifications determining that the employee’s time and effort and payroll certifications are reviewed and approved. We noted that eight of the employees that spent less than 100% of their time on the grant did not indicate how much of their time was allocated to the grant. Therefore, we were unable to verify these employees’ time and effort. We also noted two employees that had missing payroll certifications. Therefore, we were unable to verify approval of the certification had occurred. The sampling methodology used was not statistically valid. Cause Time and effort statements were not prepared in all cases and adequate oversight of the employee’s payroll certification was not in place in order to identify mistakes approved pay. Effect Without demonstrable, documented controls supporting compliance with Title I compliance standards, compliance with the requirements may not be assured. Questioned Costs Known and likely questioned costs were not determinable. Recommendation We recommend that the School District institute additional procedures to ensure that employee’s time and effort, for those with less than 100% allocated to the grant, and payroll certifications are documented and reviewed for accuracy. View of Responsible Officials The School District will institute additional procedures to ensure that time and effort determinations are reviewed and accurate.

2022-001. Internal Control Over Compliance United States Department of Education, passed-through New York State Department of Education: Special Education Cluster Special Education Grants to States ALN: 84.027A Special Education Grants to States: IDEA 611 ARP Allocations ALN: 84.027X Special Education Preschool Grants ALN: 84.173A Special Education Preschool Grants: IDEA 619 ARP Allocations ALN: 84.173X Education Stabilization Fund (ESF) COVID-19: Governor?s Emergency Education Relief (GEER) Fund ALN: 84.425C COVID-19: Elementary and Secondary School Emergency Relief (ESSER) Fund ALN: 84.425D COVID-19: American Rescue Plan ? Elementary and Secondary School Emergency Relief (ARP ESSER) Fund ALN: 84.425U Criteria: 2 CFR ?200.303 of the Uniform Guidance requires non-federal entities receiving federal awards to establish and maintain 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. Under the Uniform Guidance federal awards recipients must maintain updated written documentation of internal control policies and procedures, which include but are not limited to procurement policies that adhere to state and local law, as well as federal regulations and statutes; procedures for documenting how costs are to be allocated to federal awards, documenting actual time and effort for payroll costs charged to federal awards; cash management procedures to minimize the time elapsed between the receipts and disbursements of federal funds; and how to safeguard personally identifiable information. Condition: The District has not yet completed updating its existing policies and written procedures to conform to Uniform Guidance requirements. Cause: The development of a policy was delayed due to the turnover in key Business Office positions. Effect: Not having implemented the updated written policies and procedures weaken the internal controls over the federal award and could increase the risk of noncompliance with federal statutes and regulations. Questioned Costs: None reported. Context: During inquiries of District personnel regarding procedures, it was noted that District policies had not been updated to include changes as a result of the implementation of the Uniform Guidance. The lack of updated policies did not result in any questioned costs or improper reimbursements. Identification of a Repeat Finding: This was part of a finding from the previous audit referenced as 2019-001 and 2020-001, related to the Child Nutrition Cluster. That same finding is related to the major programs or awards identified above, the Special Education Cluster and the Education Stabilization Fund. Recommendation: The District must review its existing written policies and procedures and update them as needed in order to comply with requirements of Uniform Guidance. Views of Responsible Officials of Auditee: The District adopted a Federal Fund Procedural Manual on January 24, 2023.

2022-002. Equipment and Real Property Management United States Department of Education, passed-through New York State Department of Education: Education Stabilization Fund (ESF) COVID-19: Governor?s Emergency Education Relief (GEER) Fund ALN: 84.425C COVID-19: Elementary and Secondary School Emergency Relief (ESSER) Fund ALN: 84.425D COVID-19: American Rescue Plan ? Elementary and Secondary School Emergency Relief (ARP ESSER) Fund ALN: 84.425U Criteria: 2 CFR ?200.313 of the Uniform Guidance issued by the U.S. Office of Management and Budget requires management to have procedures for managing equipment (including replacement equipment), whether acquired in whole or in part under a federal award, until disposition takes place, which includes maintaining property records that include a description of the property, a serial number or other identification number, the source of funding for the property (including FAIN), who holds title, the acquisition date and cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. Condition: The District did not tag and include as an addition, equipment purchased using federal grant funds during the current year, in the District?s capital assets inventory. Cause: Due to the District not having procedures in place to reconcile the District?s equipment codes to the annual capital assets additions, the equipment purchased under the federal grant was inadvertently omitted from the current year capital assets inventory additions. Effect: This could result in the improper use or disposal of capital assets purchased from federal funds. Questioned Costs: None reported. Context: The District rarely uses federal grant funds for the purchase of equipment. Additionally, there were significant changes in personnel within the Business Office during the year. As a result, when the capital assets additions were being compiled and sent to the District?s third party capital assets management company, the equipment purchased using federal grant funds was inadvertently omitted from the listing. Identification of a Repeat Finding: This is not a repeat finding. Recommendation: The District should implement procedures where there is a formal reconciliation performed annually between all of the District?s equipment expenditure codes and the additions to the District?s capital assets inventory. Additionally, all capital assets additions purchased with federal funds should be immediately tagged and managed in accordance with 2 CFR ?200.313. Views of Responsible Officials of Auditee: Management agrees with the finding and will ensure that the equipment gets properly tagged and added to the District?s capital assets inventory record.

2022-003. Allowable Costs/Cost Principles United States Department of Education, passed-through New York State Department of Education: Special Education Cluster Special Education Grants to States ALN: 84.027A Special Education Grants to States: IDEA 611 ARP Allocations ALN: 84.027X Special Education Preschool Grants ALN: 84.173A Special Education Preschool Grants: IDEA 619 ARP Allocations ALN: 84.173X Education Stabilization Fund (ESF) COVID-19: Governor?s Emergency Education Relief (GEER) Fund ALN: 84.425C COVID-19: Elementary and Secondary School Emergency Relief (ESSER) Fund ALN: 84.425D COVID-19: American Rescue Plan ? Elementary and Secondary School Emergency Relief (ARP ESSER) Fund ALN: 84.425U Criteria: 2 CFR ?200.303 of the Uniform Guidance issued by the U.S. Office of Management and budget requires that salaries and wages charged to federal awards must be supported by documentation prescribed by the Uniform Guidance at Subpart E, 2 CFR ?200.430. Condition: Subpart E, 2 CFR ?200.430 of the Uniform Guidance requires that charges to ?federal awards for salaries and wages must be based on records that accurately reflect the work performed.? The documentation should support the distribution of the employee?s compensation among specific activities if the employee works on more than one federal award, or a federal award and non-federal award. The preparation of personnel activity reports (PARs) or periodic certifications or the equivalent is the most effective way to comply with this requirement. During the current year, the District failed to prepare periodic certification equivalents correctly, to comply with Subpart E, 2 CFR ?200.430. Cause: Due to turnover in key Business Office positions, the District did not obtain the necessary documentation on a periodic basis to certify that salaries and wages were charged to the appropriate grants. Effect: Noncompliance could result in the incorrect amount of services rendered being charged to the federal award. Questioned Costs: None reported. Context: Total population size of payroll expenditures was 218 for the education stabilization funds, and 44 for the special education cluster. Audit sample size was selected based on small population sampling table, which yielded a sample size of 25 for the education stabilization funds, and 5 for the special education cluster, systematically selected for audit testing. Finding was identified in three audit samples for the education stabilization funds, and two for the special education cluster. Identification of a Repeat Finding: This is not a repeat finding. Recommendation: The District should prepare the appropriate documentation to support salaries and wages determined by services performed that are charged to federal awards in accordance with the requirements of the Uniform Guidance Subpart E, 2 CFR ?200.430. Views of Responsible Officials of Auditee: The District will adopt procedures to ensure appropriate documentation will be prepared to comply with Subpart E, 2 CFR ?200.430.

SIGNIFICANT DEFICIENCY 2021-001. INTERNAL CONTROL OVER COMPLIANCE Education Stabilization Fund (ESF) COVID-19: Governor?s Emergency Education Relief (GEER) Fund Assistance Listing (CFDA) No. 84.425C COVID-19: Elementary and Secondary School Emergency Relief (ESSER) Fund Assistance Listing (CFDA) No. 84.425D Title I Grants to Local Educational Agencies Assistance Listing (CFDA) No. 84.010 English Language Acquisition State Grants Assistance Listing (CFDA) No. 84.365 Criteria: 2 CFR section 200.303 of the Uniform Guidance requires non-federal entities receiving federal awards to establish and maintain internal control over the federal awards 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. Under the Uniform Guidance federal awards recipients must maintain updated written documentation of internal control policies and procedures, which include but are not limited to procurement policies that adhere to state and local law as well as federal regulations and statutes; procedures for documenting how costs are to be allocated to federal awards, documenting actual time and effort for payroll costs charged to federal awards; cash management procedures to minimize the time elapsed between the receipts and disbursements of federal funds; and how to safeguard personally identifiable information. Condition: The District has not yet completed updating their existing policies and written procedures to conform to Uniform Guidance requirements. Cause: Staffing constraints as well as the District switching to a remote work format due to the state mandated closure of the District as a result of the COVID-19 pandemic limited the District?s ability to develop new policies and procedures. Potential Effect: Not having implemented the updated written policies and procedures weaken the internal controls over the federal award and could increase the risk of noncompliance with federal statutes and regulations. Questioned Costs: None reported. Repeat Finding: This was part of a finding from the previous audit referenced as 2020-001, related to the Child Nutrition Cluster. Recommendation: The District must review its existing written policies and procedures and update them as needed in order to comply with requirements of Uniform Guidance. Views of Responsible Officials of Auditee: The District is aware of this finding and is in the process of creating this document and updating procedures as they relate to the document.

2020-001. Internal Control Over Compliance Child Nutrition Cluster School Breakfast Program CFDA No. 10.553 Federal Snack Program CFDA No. 10.555 National School Lunch Program CFDA No. 10.555 Criteria: 2 CFR section 200.303 of the Uniform Guidance requires non-Federal entities receiving Federal awards to establish and maintain internal control over the Federal awards 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. Under the Uniform Guidance Federal awards recipients must maintain updated written documentation of internal control policies and procedures, which include procurement policies that adhere to state and local law as well as federal regulations and statutes; procedures for documenting how costs are to be allocated to federal awards, documenting actual time and effort for payroll costs charged to federal awards; cash management procedures to minimize the time elapsed between the receipts and disbursements of federal funds; and how to safeguard personally identifiable information. Condition: The District has not yet completed updating their existing policies and written procedures to conform to Uniform Guidance requirements. Cause: Staffing constraints as well as the District switching to a remote work format due to the State mandated closure of the District as a result of the COVID-19 pandemic limited the District?s ability to develop new policies and procedures. Potential Effect: Not having implemented the updated written policies and procedures weaken the internal controls over the Federal award and could increase the risk of noncompliance with Federal statutes and regulations. Questioned Costs: None reported. Repeat Finding: This was part of a finding from the previous audit referenced as 2019-001, related to the Special Education Cluster. Recommendation: The District must review its existing written policies and procedures and update them as needed in order to comply with requirements of Uniform Guidance. Views of Responsible Officials of Auditee: The District is aware of this finding and is in the process of creating this document and updating procedures as they relate to the document.

2019-001. Internal Control Over Compliance ? Procurement Special Education Cluster Special Education Grants to States CFDA No. 84.027 Special Education Preschool Grants CFDA No. 84.173 Supporting Effective Instruction State Grants CFDA No. 84.367 Criteria: 2 CFR section 200.303 of the Uniform Guidance requires non-Federal entities receiving Federal awards to establish and maintain internal control over the Federal awards 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. Under the Uniform Guidance, Federal awards recipients must maintain updated written documentation of internal control policies and procedures, which include procurement policies that adhere to state and local law as well as federal regulations and statutes; procedures for documenting how costs are to be allocated to federal awards, documenting actual time and effort for payroll costs charged to federal awards; cash management procedures to minimize the time elapsed between the receipts and disbursements of federal funds; and how to safeguard personally identifiable information. Condition: The District has not updated their existing policies and written procedures to conform to Uniform Guidance requirements. Cause: Staffing constraints limited the District?s ability to perform a timely review and update of its existing policies and written procedures. Potential Effect: Not having updated written policies and procedures weaken the internal controls over the Federal award, and could increase the risk of noncompliance with Federal statutes and regulations. Questioned Costs: None reported. Repeat Finding: This is not a repeat finding from the previous audit. Recommendation: The District must review its existing written policies and procedures and update them as needed in order to comply with requirements of Uniform Guidance. Views of Responsible Officials of Auditee: The District agreed with the auditor and the Deputy Superintendent will be updating District policies and procedures in accordance with the U.S. Office of Management and Budget?s Uniform Guidance.

2019-002. Internal Control Over Compliance ? Allowable Costs Special Education Cluster Special Education Grants to States CFDA No. 84.027 Special Education Preschool Grants CFDA No. 84.173 Criteria: As prescribed by the Uniform Guidance at Subpart E, 2 CFR section 200.430 internal controls over payroll need to include a documented system for time and effort reporting and a review process to determine that payroll charges are accurate, allowable, and properly allocated. Condition: The District prepares periodic personnel activity reports, which are signed by the employees, to support all salaries and wages charged to federal awards. There was an instance noted where a personnel activity report indicated time worked on a different grant rather than the federal grant they were charged to. The costs charged to this grant were supported by other documentation that indicated these costs were allowable, and therefore did not result in questioned costs. Cause: Due to an oversight, a periodic personnel activity report for an individual working on a federal award did not indicate the proper federal award. Potential Effect: Not having a secondary review process for personnel activity reports could result in erroneous reimbursement for program expenditures. Questioned Costs: None reported. Repeat Finding: This is not a repeat finding from the previous audit. Recommendation: The District should implement procedures to collect and review for accuracy the appropriate documentation used to support salaries and wages charged to federal awards in accordance with the requirements of 2 CFR section 200.430 on a timely basis. Views of Responsible Officials of Auditee: The District agreed with the auditor and the Deputy Superintendent is implementing a secondary review process of personnel activity reports.