Harborfields Central School District

Significant Deficiency 2025-001. Equipment and Real Property Management United States of Education, Passed-through New York State, Department of Education: Special Education Cluster Special Education Grants to States: IDEA Part B ALN: 84.027 Special Education Preschool Grants: IDEA Preschool ALN: 84.173 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. This 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 the Federal Award Identification Number (FAIN), and who holds title. In addition, it requires the District to track 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 include, as additions in the District’s capital assets inventory records, all equipment purchased with federal awards. Cause: The District uses specific codes to identify and track equipment purchased during the year. Since the District did not have procedures in place to timely review and reconcile the District’s purchases posted to the equipment codes to the annual capital assets additions in the inventory records, equipment purchased with federal awards was inadvertently omitted from the current year capital assets inventory. Effect: The inability to include and differentiate capital assets acquired with federal awards in the capital assets inventory records could lead to improper procedures for tracking and disposal of those capital assets. Questioned Costs: Dollar amount undetermined, as adequate documentation was not available. Context: The District rarely uses federal awards for the purchase of equipment. As a result of this, when District staff was compiling the listing of equipment purchased during the year, to be provided to the District’s third-party capital assets management company, the equipment purchased using federal awards was inadvertently omitted from the listing. Identification of a Repeat Finding: This is a repeat finding from the previous year audit, 2024-001 in connection with audit of the Education Stabilization Fund awards expended, ALN: 84.425D, ALN: 84.425U, and ALN: 84.425W. Recommendation: The District should implement procedures where there is a formal reconciliation performed annually for all equipment expenditures with the additions to the District’s capital assets inventory. This will ensure that all equipment purchased with federal awards is captured and included in the capital assets inventory records. Additionally, all capital assets additions purchased with federal funds should be 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 purchased with federal awards is identified and included in the District’s capital assets inventory records as part of the capital assets reconciliation process.

Significant Deficiency 2024-001. Equipment and Real Property Management United States of Education, Passed Through New York State, Department of Education: Education Stabilization Fund COVID-19: Elementary and Secondary School Emergency Relief Fund ALN: 84.425D COVID-19: American Rescue Plan – Elementary and Secondary School Emergency Relief ALN: 84.425U COVID-19: American Rescue Plan – Elementary and Secondary School Emergency Relief – Homeless Children and Youth ALN: 84.425W 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. This 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 the Federal Award Identification Number (FAIN), and who holds title. In addition, it requires the District to track 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 include all equipment purchased with federal grant funds in its current year additions in the District’s capital assets inventory records. Cause: The District uses specific codes to identify and track equipment purchased during the year. Since the District did not have procedures in place to timely review and reconcile the District’s equipment purchases codes to the annual capital assets additions, equipment purchased under the federal grants was inadvertently omitted from the current year capital assets inventory additions. Effect: The inability to include and differentiate capital assets acquired with federal awards in the capital assets inventory records could lead to improper procedures for disposal of those capital assets. Questioned Costs: None reported. Context: The District rarely uses federal grant funds for the purchase of equipment. As a result of this, when District staff was compiling the listing of equipment purchased during the year, to be provided 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 a repeat finding from the previous year audit, 2023-002. Recommendation: The District should implement procedures where there is a formal reconciliation performed annually for all of the District’s equipment expenditure codes and the additions to the District’s capital assets inventory. This will ensure that all equipment purchased with federal funds is captured and included in the capital assets inventory records. Additionally, all capital assets additions purchased with federal funds should be 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 purchased with federal funds is identified and included in the District’s capital assets inventory records as part of the capital assets reconciliation process.

Significant Deficiencies 2023-001. Allowable Costs/Cost Principles Special Education Cluster Special Education Grants to States: IDEA Part B ALN: 84.027A Special Education Grants to States: IDEA 611 ARP Allocations ALN: 84.027X Special Education Preschool Grants: IDEA Preschool ALN: 84.173A Special Education Preschool Grants: IDEA 619 ARP Allocations ALN: 84.173X Criteria: 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 prepared periodic certification equivalents, but it did not comply with Subpart E, 2 CFR §200.430. Cause: The staff that were responsible for maintaining records that accurately reflect the work performed, as described in Subpart E, 2 CFR §200.430, to support salaries charged to Federal awards, prepared annual periodic certification reports using amounts based on budgets for time performance. The reports were not updated to reflect actual time performance amounts. Potential Effect: Noncompliance could result in the incorrect amount for services rendered being charged to the Federal award. Context: The District maintains time records for employees charged to Federal awards in accordance with approved budgets. Questioned Costs: None reported. Repeat Finding: This is part of a repeat finding from a previous year audit, 2021-001. Recommendation: The District should revise its procedures to prepare documentation to support actual salaries and wages charged to Federal awards in accordance with the requirements of the Uniform Guidance at 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.

2023-002. Equipment and Real Property Management Education Stabilization Fund (ESF) COVID-19: Elementary and Secondary School Emergency Relief Fund ALN: 84.425D COVID-19: American Rescue Plan – Elementary and Secondary School Emergency Relief ALN: 84.425U COVID-19: American Rescue Plan – Elementary and Secondary School Emergency Relief – Homeless Children and Youth ALN: 84.425W 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. This 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 the Federal Award Identification Number (FAIN), and who holds title. In addition, it requires the District to track 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 include equipment purchased with Federal grant funds in its current year additions in the District’s capital assets inventory records. Cause: The District uses specific codes to identify and track equipment purchased during the year. Since the District did not have adequate procedures in place to review and reconcile the District’s equipment purchases codes to the annual capital asset additions, the equipment purchased under the Federal grants was inadvertently omitted from the current year capital assets inventory additions. Effect: The inability to include and differentiate capital assets acquired with Federal awards in the capital asset inventory records could lead to improper procedures for disposal of those capital assets. Questioned Costs: None reported. Context: The District rarely uses Federal grant funds for the purchase of equipment. As a result of this, when the District’s Purchasing Agent was compiling the listing of equipment purchased during the year, to be provided to the District’s third-party capital asset management company, the equipment purchased using Federal grant funds was inadvertently omitted from the listing. Recommendation: The District should implement procedures where there is a formal reconciliation performed annually for all of the District’s equipment expenditure codes and the additions to the District’s capital assets inventory. This will ensure that all equipment purchased with Federal funds is captured and included in the capital asset inventory records. Additionally, all capital asset additions purchased with Federal funds should be 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 purchased with Federal funds is identified and included in the District’s capital assets inventory records as part of the capital asset reconciliation process.

FEDERAL AWARD FINDINGS AND QUESTIONED COSTS Significant Deficiency 2021-001. Allowable Costs/Cost Principles Special Education Cluster Special Education Grants to States Assistance Listing (CFDA) No. 84.027 Special Education Preschool Grants Assistance Listing (CFDA) No. 84.173 Criteria: 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: The staff that were responsible for maintaining records that accurately reflect the work performed, as described in Subpart E, 2 CFR 200.430, to support salaries charged to Federal awards, prepared the periodic certification reports prior to the performance of the services that were charged to the Federal awards. Potential Effect: Noncompliance could result in the incorrect amount for services rendered being charged to the Federal award. Questioned Costs: None reported. Repeat Finding: This is not a repeat finding from a previous year audit. 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 at 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 2019-001. Internal Control Over Compliance - Procurement Department of Education Special Education Cluster Special Education Grants to States CFDA No. 84.027 Special Education Preschool Grants CFDA No. 84.173 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: Management is aware of the finding and has subsequently adopted the updated policy.