BOARD OF EDUCATION CITY OF PLAINFIELDLocal Government

Coronavirus State and Local Fiscal Recovery Funds (Federal Assistance Listing No. 21.027) Criteria: In accordance with 2 CFR §200.302(a) of the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), non-federal entities must maintain financial management systems that provide for the identification, in their accounts, of all federal awards received and expended, and must ensure accurate, current, and complete disclosure of financial results. Additionally, according to Governmental Accounting Standards Board (GASB) Statement No. 54, special revenue funds are used to account for specific revenue sources that are restricted or committed to expenditures for specified purposes other than debt service or capital projects. Since funds received under Assistance Listing 21.027 are restricted for specific uses, they should be accounted for in a special revenue fund. Condition: During our audit for the fiscal year ended June 30, 2025, we noted that the District did not record $4,860,733 in transactions related to the Coronavirus State and Local Fiscal Recovery Funds (Assistance Listing 21.027) in the appropriate fund. Instead of recording this activity in the Special Revenue Fund, the transactions were recorded in the General Fund. Based on grant receipts received by the District of $4,860,733 in the fiscal year ended June 30, 2025 it was determined that expenditures relating to the grant were incurred in the General Fund in the fiscal years ended June 30, 2025 and 2024 in the amounts of $1,017,513 and $3,843,220 respectively. The receipts in the amount of $1,017,513 related to expenditures incurred in the year ended June 30, 2025 were reclassified to the Special Revenue Fund. Questioned Costs: None Context: $4,860,733 in transactions related to the Coronavirus State and Local Fiscal Recovery Funds were recorded in the General Fund instead of the Special Revenue Fund. Effect: Recording of the $4,860,733 in federally restricted grant activity in the General Fund instead of the Special Revenue Fund reduces the transparency of the financial statements and may obscure the tracking of federal expenditures. This misclassification increases the risk of noncompliance with federal grant reporting requirements, and may result in inaccurate reporting on the Schedule of Expenditures of Federal Awards (SEFA), which could impact audit results or federal program oversight. The expenditures incurred in both years were subject to a single audit in the fiscal year ended June 30, 2025. Cause: Unknown. Recommendation: We recommend that management establish procedures to ensure that all federal grant activity is recorded in the appropriate fund, consistent with GASB and Uniform Guidance requirements. Specifically, all activity related to Assistance Listing 21.027 should be accounted for in the Special Revenue Fund to maintain proper accountability. View of Responsible Officials and Planned Corrective Action: Management has reviewed this finding and has indicated a corrective action plan will be developed to address this finding and recommendation.

Coronavirus State and Local Fiscal Recovery Funds (Federal Assistance Listing No. 21.027) Criteria: In accordance with 2 CFR §200.302(a) of the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), non-federal entities must maintain financial management systems that provide for the identification, in their accounts, of all federal awards received and expended, and must ensure accurate, current, and complete disclosure of financial results. Additionally, according to Governmental Accounting Standards Board (GASB) Statement No. 54, special revenue funds are used to account for specific revenue sources that are restricted or committed to expenditures for specified purposes other than debt service or capital projects. Since funds received under Assistance Listing 21.027 are restricted for specific uses, they should be accounted for in a special revenue fund. Condition: During our audit for the fiscal year ended June 30, 2025, we noted that the District did not record $4,860,733 in transactions related to the Coronavirus State and Local Fiscal Recovery Funds (Assistance Listing 21.027) in the appropriate fund. Instead of recording this activity in the Special Revenue Fund, the transactions were recorded in the General Fund. Based on grant receipts received by the District of $4,860,733 in the fiscal year ended June 30, 2025 it was determined that expenditures relating to the grant were incurred in the General Fund in the fiscal years ended June 30, 2025 and 2024 in the amounts of $1,017,513 and $3,843,220 respectively. The receipts in the amount of $1,017,513 related to expenditures incurred in the year ended June 30, 2025 were reclassified to the Special Revenue Fund. Questioned Costs: None Context: $4,860,733 in transactions related to the Coronavirus State and Local Fiscal Recovery Funds were recorded in the General Fund instead of the Special Revenue Fund. Effect: Recording of the $4,860,733 in federally restricted grant activity in the General Fund instead of the Special Revenue Fund reduces the transparency of the financial statements and may obscure the tracking of federal expenditures. This misclassification increases the risk of noncompliance with federal grant reporting requirements, and may result in inaccurate reporting on the Schedule of Expenditures of Federal Awards (SEFA), which could impact audit results or federal program oversight. The expenditures incurred in both years were subject to a single audit in the fiscal year ended June 30, 2025. Cause: Unknown. Recommendation: We recommend that management establish procedures to ensure that all federal grant activity is recorded in the appropriate fund, consistent with GASB and Uniform Guidance requirements. Specifically, all activity related to Assistance Listing 21.027 should be accounted for in the Special Revenue Fund to maintain proper accountability. View of Responsible Officials and Planned Corrective Action: Management has reviewed this finding and has indicated a corrective action plan will be developed to address this finding and recommendation.

Coronavirus State and Local Fiscal Recovery Funds (Federal Assistance Listing No. 21.027) Criteria: In accordance with 2 CFR §200.302(a) of the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), non-federal entities must maintain financial management systems that provide for the identification, in their accounts, of all federal awards received and expended, and must ensure accurate, current, and complete disclosure of financial results. Additionally, according to Governmental Accounting Standards Board (GASB) Statement No. 54, special revenue funds are used to account for specific revenue sources that are restricted or committed to expenditures for specified purposes other than debt service or capital projects. Since funds received under Assistance Listing 21.027 are restricted for specific uses, they should be accounted for in a special revenue fund. Condition: During our audit for the fiscal year ended June 30, 2025, we noted that the District did not record $4,860,733 in transactions related to the Coronavirus State and Local Fiscal Recovery Funds (Assistance Listing 21.027) in the appropriate fund. Instead of recording this activity in the Special Revenue Fund, the transactions were recorded in the General Fund. Based on grant receipts received by the District of $4,860,733 in the fiscal year ended June 30, 2025 it was determined that expenditures relating to the grant were incurred in the General Fund in the fiscal years ended June 30, 2025 and 2024 in the amounts of $1,017,513 and $3,843,220 respectively. The receipts in the amount of $1,017,513 related to expenditures incurred in the year ended June 30, 2025 were reclassified to the Special Revenue Fund. Questioned Costs: None Context: $4,860,733 in transactions related to the Coronavirus State and Local Fiscal Recovery Funds were recorded in the General Fund instead of the Special Revenue Fund. Effect: Recording of the $4,860,733 in federally restricted grant activity in the General Fund instead of the Special Revenue Fund reduces the transparency of the financial statements and may obscure the tracking of federal expenditures. This misclassification increases the risk of noncompliance with federal grant reporting requirements, and may result in inaccurate reporting on the Schedule of Expenditures of Federal Awards (SEFA), which could impact audit results or federal program oversight. The expenditures incurred in both years were subject to a single audit in the fiscal year ended June 30, 2025. Cause: Unknown. Recommendation: We recommend that management establish procedures to ensure that all federal grant activity is recorded in the appropriate fund, consistent with GASB and Uniform Guidance requirements. Specifically, all activity related to Assistance Listing 21.027 should be accounted for in the Special Revenue Fund to maintain proper accountability. View of Responsible Officials and Planned Corrective Action: Management has reviewed this finding and has indicated a corrective action plan will be developed to address this finding and recommendation.

Coronavirus State and Local Fiscal Recovery Funds (Federal Assistance Listing No. 21.027) Criteria: In accordance with 2 CFR §200.302(a) of the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), non-federal entities must maintain financial management systems that provide for the identification, in their accounts, of all federal awards received and expended, and must ensure accurate, current, and complete disclosure of financial results. Additionally, according to Governmental Accounting Standards Board (GASB) Statement No. 54, special revenue funds are used to account for specific revenue sources that are restricted or committed to expenditures for specified purposes other than debt service or capital projects. Since funds received under Assistance Listing 21.027 are restricted for specific uses, they should be accounted for in a special revenue fund. Condition: During our audit for the fiscal year ended June 30, 2025, we noted that the District did not record $4,860,733 in transactions related to the Coronavirus State and Local Fiscal Recovery Funds (Assistance Listing 21.027) in the appropriate fund. Instead of recording this activity in the Special Revenue Fund, the transactions were recorded in the General Fund. Based on grant receipts received by the District of $4,860,733 in the fiscal year ended June 30, 2025 it was determined that expenditures relating to the grant were incurred in the General Fund in the fiscal years ended June 30, 2025 and 2024 in the amounts of $1,017,513 and $3,843,220 respectively. The receipts in the amount of $1,017,513 related to expenditures incurred in the year ended June 30, 2025 were reclassified to the Special Revenue Fund. Questioned Costs: None Context: $4,860,733 in transactions related to the Coronavirus State and Local Fiscal Recovery Funds were recorded in the General Fund instead of the Special Revenue Fund. Effect: Recording of the $4,860,733 in federally restricted grant activity in the General Fund instead of the Special Revenue Fund reduces the transparency of the financial statements and may obscure the tracking of federal expenditures. This misclassification increases the risk of noncompliance with federal grant reporting requirements, and may result in inaccurate reporting on the Schedule of Expenditures of Federal Awards (SEFA), which could impact audit results or federal program oversight. The expenditures incurred in both years were subject to a single audit in the fiscal year ended June 30, 2025. Cause: Unknown. Recommendation: We recommend that management establish procedures to ensure that all federal grant activity is recorded in the appropriate fund, consistent with GASB and Uniform Guidance requirements. Specifically, all activity related to Assistance Listing 21.027 should be accounted for in the Special Revenue Fund to maintain proper accountability. View of Responsible Officials and Planned Corrective Action: Management has reviewed this finding and has indicated a corrective action plan will be developed to address this finding and recommendation.

Federal Program: Child Nutrition Cluster (Federal Assistance Listing Nos. 10.555, 10.553, 10.559 and 10.582) Criteria: CFR Section 210.14 Resource Management (b) Net cash resources requires a school food authority to limit its net cash resources to an amount that does not exceed 3 months average expenditures for its’ nonprofit school food service or an amount approved by the State agency in accordance with CFR Section 210.019(a). Condition: The School District did not limit it’s net cash resources to three months average expenditures for it’s school food service fund as required by CFR Section 210.14 Resource Management (b) Net Cash Resources. Questioned Costs: None Context: The School District’s food service fund net cash resources at June 30, 2023 was $2,842,133 and it’s three month average expenditures was $2,041,664, resulting in an excess amount totaling $800,470. Effect: The School District is not in compliance with CFR section 210.14 and requirements as prescribed by the Office of School Finance, Department of Education, State of New Jersey Audit Program. Cause: The School District’s food service revenues increased more than anticipated. Recommendation: The School District should develop a plan to reduce the food service fund’s net cash resources below its three month average expenditures as required by CFR Section 210.14 Resource Management (b) Net Cash Resources. View of Responsible Officials and Planned Corrective Action: The responsible officials agree with the finding and will address the matter as part of their corrective action plan.

Federal Program: Child Nutrition Cluster (Federal Assistance Listing Nos. 10.555, 10.553, 10.559 and 10.582) Criteria: CFR Section 210.14 Resource Management (b) Net cash resources requires a school food authority to limit its net cash resources to an amount that does not exceed 3 months average expenditures for its’ nonprofit school food service or an amount approved by the State agency in accordance with CFR Section 210.019(a). Condition: The School District did not limit it’s net cash resources to three months average expenditures for it’s school food service fund as required by CFR Section 210.14 Resource Management (b) Net Cash Resources. Questioned Costs: None Context: The School District’s food service fund net cash resources at June 30, 2023 was $2,842,133 and it’s three month average expenditures was $2,041,664, resulting in an excess amount totaling $800,470. Effect: The School District is not in compliance with CFR section 210.14 and requirements as prescribed by the Office of School Finance, Department of Education, State of New Jersey Audit Program. Cause: The School District’s food service revenues increased more than anticipated. Recommendation: The School District should develop a plan to reduce the food service fund’s net cash resources below its three month average expenditures as required by CFR Section 210.14 Resource Management (b) Net Cash Resources. View of Responsible Officials and Planned Corrective Action: The responsible officials agree with the finding and will address the matter as part of their corrective action plan.

Federal Program: Child Nutrition Cluster (Federal Assistance Listing Nos. 10.555, 10.553, 10.559 and 10.582) Criteria: CFR Section 210.14 Resource Management (b) Net cash resources requires a school food authority to limit its net cash resources to an amount that does not exceed 3 months average expenditures for its’ nonprofit school food service or an amount approved by the State agency in accordance with CFR Section 210.019(a). Condition: The School District did not limit it’s net cash resources to three months average expenditures for it’s school food service fund as required by CFR Section 210.14 Resource Management (b) Net Cash Resources. Questioned Costs: None Context: The School District’s food service fund net cash resources at June 30, 2023 was $2,842,133 and it’s three month average expenditures was $2,041,664, resulting in an excess amount totaling $800,470. Effect: The School District is not in compliance with CFR section 210.14 and requirements as prescribed by the Office of School Finance, Department of Education, State of New Jersey Audit Program. Cause: The School District’s food service revenues increased more than anticipated. Recommendation: The School District should develop a plan to reduce the food service fund’s net cash resources below its three month average expenditures as required by CFR Section 210.14 Resource Management (b) Net Cash Resources. View of Responsible Officials and Planned Corrective Action: The responsible officials agree with the finding and will address the matter as part of their corrective action plan.

Federal Program: Child Nutrition Cluster (Federal Assistance Listing Nos. 10.555, 10.553, 10.559 and 10.582) Criteria: CFR Section 210.14 Resource Management (b) Net cash resources requires a school food authority to limit its net cash resources to an amount that does not exceed 3 months average expenditures for its’ nonprofit school food service or an amount approved by the State agency in accordance with CFR Section 210.019(a). Condition: The School District did not limit it’s net cash resources to three months average expenditures for it’s school food service fund as required by CFR Section 210.14 Resource Management (b) Net Cash Resources. Questioned Costs: None Context: The School District’s food service fund net cash resources at June 30, 2023 was $2,842,133 and it’s three month average expenditures was $2,041,664, resulting in an excess amount totaling $800,470. Effect: The School District is not in compliance with CFR section 210.14 and requirements as prescribed by the Office of School Finance, Department of Education, State of New Jersey Audit Program. Cause: The School District’s food service revenues increased more than anticipated. Recommendation: The School District should develop a plan to reduce the food service fund’s net cash resources below its three month average expenditures as required by CFR Section 210.14 Resource Management (b) Net Cash Resources. View of Responsible Officials and Planned Corrective Action: The responsible officials agree with the finding and will address the matter as part of their corrective action plan.

Federal Program: Child Nutrition Cluster (Federal Assistance Listing Nos. 10.555, 10.553, 10.559 and 10.582) Criteria: CFR Section 210.14 Resource Management (b) Net cash resources requires a school food authority to limit its net cash resources to an amount that does not exceed 3 months average expenditures for its’ nonprofit school food service or an amount approved by the State agency in accordance with CFR Section 210.019(a). Condition: The School District did not limit it’s net cash resources to three months average expenditures for it’s school food service fund as required by CFR Section 210.14 Resource Management (b) Net Cash Resources. Questioned Costs: None Context: The School District’s food service fund net cash resources at June 30, 2023 was $2,842,133 and it’s three month average expenditures was $2,041,664, resulting in an excess amount totaling $800,470. Effect: The School District is not in compliance with CFR section 210.14 and requirements as prescribed by the Office of School Finance, Department of Education, State of New Jersey Audit Program. Cause: The School District’s food service revenues increased more than anticipated. Recommendation: The School District should develop a plan to reduce the food service fund’s net cash resources below its three month average expenditures as required by CFR Section 210.14 Resource Management (b) Net Cash Resources. View of Responsible Officials and Planned Corrective Action: The responsible officials agree with the finding and will address the matter as part of their corrective action plan.

Federal Program: Child Nutrition Cluster (Federal Assistance Listing Nos. 10.555, 10.553, 10.559 and 10.582) Criteria: CFR Section 210.14 Resource Management (b) Net cash resources requires a school food authority to limit its net cash resources to an amount that does not exceed 3 months average expenditures for its’ nonprofit school food service or an amount approved by the State agency in accordance with CFR Section 210.019(a). Condition: The School District did not limit it’s net cash resources to three months average expenditures for it’s school food service fund as required by CFR Section 210.14 Resource Management (b) Net Cash Resources. Questioned Costs: None Context: The School District’s food service fund net cash resources at June 30, 2023 was $2,842,133 and it’s three month average expenditures was $2,041,664, resulting in an excess amount totaling $800,470. Effect: The School District is not in compliance with CFR section 210.14 and requirements as prescribed by the Office of School Finance, Department of Education, State of New Jersey Audit Program. Cause: The School District’s food service revenues increased more than anticipated. Recommendation: The School District should develop a plan to reduce the food service fund’s net cash resources below its three month average expenditures as required by CFR Section 210.14 Resource Management (b) Net Cash Resources. View of Responsible Officials and Planned Corrective Action: The responsible officials agree with the finding and will address the matter as part of their corrective action plan.