FORT FRYE LOCAL SCHOOLS

Finding Number: 2024-002 Assistance Listing Number and Title: AL # 84.425 Education Stabilization Fund Federal Award Identification Number / Year: 2024 Federal Agency: US Department of Education Compliance Requirement: Equipment and Real Property Management Pass-Through Entity: Ohio Department of Education and Workforce Repeat Finding from Prior Audit? No Noncompliance and Material Weakness 2 CFR § 3474.1 gives regulatory effect to the Department of Education for 2 CFR § 200.313(d)(1) which provides that property records must be maintained 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), who holds title, the acquisition date, 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 sales price of the property. The School District purchased HVAC equipment in the amount of $1,032,599 using COVID 19: Elementary and Secondary School Emergency Relief Funds in FY 22; however, they failed to add these assets to their capital asset listing due to a failure in adequately designed controls and still have not updated this in the capital asset records as of June 30, 2024. The also have not performed an inventory count in the past 2 years. The failure to properly record assets can lead to difficulties maintaining accountability for the related assets. The Treasurer and Superintendent should monitor transactions and ensure that all capital additions are properly documented in the capital asset records.

Finding Number: 2024-003 Assistance Listing Number and Title: AL # 84.425 Education Stabilization Fund Federal Award Identification Number / Year: 2024 Federal Agency: US Department of Education Compliance Requirement: Reporting Pass-Through Entity: Ohio Department of Education and Workforce Repeat Finding from Prior Audit? No Noncompliance and Material Weakness 2 CFR § 3474.1 provides the Department of Education (DOE) adopts the Office of Management and Budget (OMB) Guidance in 2 CFR part 200, except for 2 CFR § 200.102(a) and 2 CFR § 200.207(a). Thus, this part gives regulatory effect to the OMB guidance and supplements the guidance as needed for the DOE. As documented by the Ohio Department of Education and Workforce Office of Federal and State Grants Management, the Ohio Department of Education and Workforce requires school districts to submit the American Rescue Plan Elementary and Secondary School Emergency Relief 2024 grant Final Expenditure Report (FER) by December 2, 2024. School Districts must complete the FER at the end of each fiscal year for the prior state fiscal year’s Elementary and Secondary School Emergency Relief expenditures. All expenses reported on the FER should be paid. There should be no encumbered amounts. The Treasurer and Superintendent approved and submitted the Final Expenditure Report for the American Rescue Plan Elementary and Secondary School Emergency Relief 2024 grant and the American Rescue Plan Elementary and Secondary School Emergency Relief 2024- Reaching Every Student grant on September 27, 2024. However, the expenditures in this submission included the American Rescue Plan Elementary and Secondary School Emergency Relief 2023 grants expenditures as well as the 2024 grants. Therefore, the Final Expenditure Report for the American Rescue Plan Elementary and Secondary School Emergency Relief 2024 grant and the American Rescue Plan Elementary and Secondary School Emergency Relief 2024- Reaching Every Student grant submitted to the Ohio Department of Education and Workforce were overstated by $3,670 and $37,263, respectively. The School District should review the Final Expenditure Report before submission to help ensure all required amounts are included.

1. Site Claim Reporting Finding Number: 2023-002 Assistance Listing Number and Title: AL # 10.555/10.553 Child Nutrition Cluster Federal Award Identification Number / Year: 2023 Federal Agency: U.S. Department of Agriculture Compliance Requirement: Reporting Pass-Through Entity: Ohio Department of Education and Workforce Repeat Finding from Prior Audit? No Noncompliance and Material Weakness 2 CFR § 400.1 gives regulatory effect to the Department of Agriculture for 2 CFR §200.302(b)(3) which provides that the financial management system of each non-Federal entity must provide for records that identify adequately the source and application of funds for federally- funded activities. These records must contain information pertaining to federal awards, authorizations, obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. 2 CFR § 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 7 CFR §§ 210.7(c), 210.8(c), and 225.9(d)) provide that at a minimum, a claim must include the number of reimbursable meals/milk served by category and type during the period (generally a month) covered by the claim. All meals claimed for reimbursement must (a) be of types authorized by the school food authority’s, institution’s, or sponsor’s administering agency; (b) be served to eligible children; and (c) be supported by accurate meal counts and records indicating the number of meals served by category and type. 20% percent of the site claim form submissions during fiscal year 2023 did not agree to underlying supporting documentation. These inaccurate submissions resulted in an under-reimbursement of $6,047. The School District contacted the Ohio Department of Education and Workforce in April 2024 and were granted a One-Time-Exception for the one month's underreporting of $6,275. These errors occurred due to a weakness in internal controls, which failed to ensure site claim forms for reimbursable meals served at each building and submitted by the Center to the Ohio Department of Education were entered correctly. The School District should implement policies and procedures to help ensure that monthly site claim forms are reviewed and submitted to reflect actual counts for reimbursable meals served. Further, measures should be taken to ensure staff completing the site claim forms are adequately trained.

1. Equipment Management Finding Number: 2022-002 Assistance Listing Number and Title: AL #84.425 COVID-19- Education Stabilization Fund Federal Award Identification Number / Year: 2022 Federal Agency: U.S. Department of Education Compliance Requirement: Section F: Equipment and Real Property Management Pass-Through Entity: Ohio Department of Education Repeat Finding from Prior Audit? No Noncompliance and Material Weakness 2 CFR ? 3474.1 gives regulatory effect to the Department of Education for 2 CFR ? 200.313(d)(1) which provides that property records must be maintained 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), who holds title, the acquisition date, 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 sales price of the property. The School District purchased HVAC equipment in the amount of $1,032,599 using COVID 19: Education Stabilization Fund- Elementary and Secondary School Emergency Relief Funds. However, the School District failed to add these assets to their capital asset listing due to inadequately designed controls. The failure to properly record assets can lead to difficulties maintaining accountability for the related assets. The Treasurer and Superintendent should monitor transactions and ensure that all capital additions are properly documented in the capital asset records.