Tippecanoe Valley School Corporation

Information on the federal program: Subject: Education Stabilization Fund – Internal Controls Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 84.425U Federal Award Numbers: S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Equipment and Real Property Management Audit Findings: Material Weakness Criteria: 2 CFR 200.313(d) states in part: "Management requirements. Procedures for managing equipment (including replacement equipment), whether acquired in whole or in part under a Federal award, until disposition takes place will, as a minimum, meet the following requirements: (1) 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 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. (2) A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. (3) A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated. (4) Adequate maintenance procedures must be developed to keep the property in good condition. . . ." Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Equipment and Real Property Management Requirements compliance requirements. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. Questioned Costs: There were no questioned costs identified. Context: For the 2 sample items tested, the acquisitions were not reported on the capital asset listing for the School Corporation as of June 30, 2025. For one of the sample items, the School Corporation expended $333,000 on building renovations which was charged to the ESSER III (84.425U) grant award. For the other sample item, the School Corporation expended $71,000 for locker room upgrades that was charged to the ESSER III grant. Additionally, we noted the School Corporation’s capital asset listing did not contain all the required information, including the source of funding for the property, outlined in the criteria above. Identification as a repeat finding, if applicable: No. Recommendation: We recommend the School Corporation update the capital asset listing at least annually to include all equipment and real property acquisitions and review for potential capital asset dispositions. Additionally, we recommend the School Corporation update the capital asset listing to include all the required information, including the source of funding for the property, outlined in the criteria above. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.

FINDING 2023-002 Information on the federal program: Subject: Child Nutrition Cluster - Internal Controls Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program, Summer Food Program Assistance Listing Number: 10.553, 10.555, 10.559 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Audit Finding: Significant Deficiency Criteria: 2 CFR section 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." Condition: An effective internal control system was not in place at the School Corporation to ensure compliance with requirements related to the grant agreement and the activities allowed or unallowed and allowable costs/cost principle compliance requirements. Cause: The School Corporation's management had not developed a system of internal controls to ensure compliance with the compliance requirements listed above. Effect: The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have also allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. Questioned Costs: $0 Context: We noted that there was no primary, documented review for one of the forty sample vendor child nutrition cluster accounts payable vouchers. Identification as a repeat finding, if applicable: No. Recommendation: We recommend that the School Corporation establish a documented, primary review of all child nutrition cluster account payable claims before they are paid. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a corrective action plan.

Section III ? Federal Award Findings and Questioned Costs FINDING 2021-001 Information on the federal program: Subject: Child Nutrition Cluster - Allowable Costs/Cost Principles and Program Income Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program Assistance Listing Numbers: 10.553, 10.555, 10.559 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Allowable Costs/Cost Principles, Program Income Criteria: 2 CFR 200.303 states in part: "The non-Federal entity must: (a)Establish and maintain effective internal control over the Federal award that provides reasonableassurance that the non-Federal entity is managing the Federal award in compliance with Federalstatutes, regulations, and the terms and conditions of the Federal award. These internal controls shouldbe in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued bythe Comptroller General of the United States or the 'Internal Control Integrated Framework', issued bythe Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a)Be necessary and reasonable for the performance of the Federal award and be allocable thereto underthese principles. (b)Conform to any limitations or exclusions set forth in these principles or in the Federal award as to typesor amount of cost items. . . . (g)Be adequately documented. . . ." Condition: An effective internal control system was not in place in order to ensure compliance with the requirements related to the grant agreement and the Allowable Costs/Cost Principles and Program Income compliance requirements. Cause: The School Corporation's management had not developed or implemented a system of internal controls that would have ensured compliance with the Allowable Costs/Cost Principles and Program Income compliance requirements. Effect: The failure to establish an effective internal control system could enable noncompliance with the grant agreement and the compliance requirements listed above. Questioned Costs: $0 TIPPECANOE VALLEY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS June 30, 2021 42. Section III ? Federal Award Findings and Questioned Costs (Continued) FINDING 2021-001 (Continued) Context: During the allowable cost testing of vendor disbursements related to the food service program, we noted three instances out of a sample of 60 disbursements selected where the School Corporation could not locate supporting documentation including invoice and purchase order to support the disbursement selected. The School Corporation manages the food service program at the building level. The missing documentation was isolated to one school building location. During the testing of internal controls over program income, we noted there was no documented review of the monthly receipt entry to recognize program income to Fund 0800 (School Lunch Fund) related to food service activity. Identification as a repeating finding: No. Recommendation: We recommend that the School Corporation's management establish effective controls to ensure all supporting documentation is maintained to support disbursements related to the school food service program. For program income, we recommend management implement a documented review of the monthly receipts entry to ensure program income is properly recorded to Fund 0800. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has prepared a Corrective Action Plan.

FINDING 2019-002 Subject: Child Nutrition Cluster - Eligibility Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program CFDA Numbers: 10.553, 10.555 Federal Award Numbers and Years (or Other Identifying Numbers): FY 2018, FY 2019 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Eligibility Audit Findings: Material Weakness, Modified Opinion Condition and Context An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Eligibility compliance requirement. Parents submitted applications for the School Food program online and all information was maintained within the meal software program. The School Corporation changed meal software programs on July 1, 2019, and could not access the prior software. Free and Reduced Price Applications for fiscal years 2017-2018 and 2018-2019 were not provided for audit; therefore, we were unable to determine the School Corporation's compliance with the Eligibility compliance requirement. The lack of controls and supporting documentation was a systemic issue throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.302(b)(3) states: "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 200.333 states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient . . ." Cause Management of the School Corporation had not developed a system of internal controls to ensure that supporting documentation was maintained and made available for audit relating to the Eligibility compliance requirement. Effect The failure to retain and provide appropriate supporting documentation prevented the determination of the School Corporation's compliance with the Eligibility compliance requirement for 2017-2018 and 2018-2019. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish internal controls to ensure that documentation is maintained and made available for audit relating to the grant agreement and the Eligibility compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

FINDING 2019-003 Subject: Child Nutrition Cluster - Special Tests and Provisions - Verification of Free and Reduced Price Applications (NSLP) Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program CFDA Numbers: 10.553, 10.555 Federal Award Numbers and Years (or Other Identifying Numbers): FY 2018, FY 2019 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Special Tests and Provisions - Verification of Free and Reduced Price Applications (NSLP) Audit Finding: Material Weakness Condition and Context An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Special Tests and Provisions - Verification of Free and Reduced Price Applications (NSLP) compliance requirement. One employee was responsible for completing the verification of Free and Reduced Priced Applications with no review or oversight documented. The lack of internal controls was a systemic issue throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." Cause Management had not developed a system of internal controls that segregated key functions. Effect The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and the Special Tests and Provisions - Verification of Free and Reduced Price Applications (NSLP) compliance requirement. A lack of segregation of duties within an internal control system could also allow noncompliance with the compliance requirement and allow the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the programs. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls, including segregation of duties, related to the grant agreement and the Special Tests and Provisions - Verification of Free and Reduced Price Applications (NSLP) compliance requirement. An internal control system, including segregation of duties, should be designed and operate effectively to provide reasonable assurance that material noncompliance with the grant agreement or a compliance requirement of a federal program will be prevented, or detected and corrected, on a timely basis. In order to have an effective internal control system, it is important to have proper segregation of duties. This is accomplished by making sure proper oversight, reviews, and approvals take place and to have a separation of functions over certain activities related to the program. The fundamental premise of segregation of duties is that an individual or small group of individuals should not be in a position to initiate, approve, undertake, and review the same activity. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

GSA_MIGRATION

GSA_MIGRATION