EIN: 356006777
UEI: CGHTH2PPNQP8
Audited by: Forvis Mazars, LLP
Oversight agency: 84 [Department of Education]
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Data as of September 2, 2026
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on March 3, 2026. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by September 3, 2026 (1 day ago).
What is a management decision? →FAC accepted this audit on March 4, 2025 — management decision was due September 4, 2025.
FAC accepted this audit on February 26, 2024 — management decision was due August 26, 2024.
FAC accepted this audit on March 22, 2023 — management decision was due September 22, 2023.
FAC accepted this audit on June 14, 2022 — management decision was due December 14, 2022.
FAC accepted this audit on June 14, 2021 — management decision was due December 14, 2021.
FAC accepted this audit on March 26, 2020 — management decision was due September 26, 2020.
FINDING 2019-001 Subject: Special Education Cluster (IDEA) - Activities Allowed or Unallowed and Allowable Costs/Cost Principles Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants CFDA Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 18611-093-PN01, 19611-093-PN01, 18619-093-PN01, 19619-093-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Audit Finding: Material Weakness Condition and Context An effective internal control system, which would include segregation of duties, was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Activities Allowed or Unallowed and Allowable Costs/Cost Principles compliance requirements. There was no documented review of the payroll information charged to the grant during fiscal year 2018-2019. The lack of controls was isolated to 2018-2019. 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 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. 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 of the School Corporation 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 compliance requirements listed above. A lack of segregation of duties within an internal control system could also allow noncompliance with the compliance requirements 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 to ensure compliance with the grant agreement and the Activities Allowed or Unallowed and Allowable Costs/Cost Principles compliance requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Show full finding ▾Hide full finding ▴FINDING 2019-001 Subject: Special Education Cluster (IDEA) - Activities Allowed or Unallowed and Allowable Costs/Cost Principles Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants CFDA Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 18611-093-PN01, 19611-093-PN01, 18619-093-PN01, 19619-093-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Audit Finding: Material Weakness Condition and Context An effective internal control system, which would include segregation of duties, was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Activities Allowed or Unallowed and Allowable Costs/Cost Principles compliance requirements. There was no documented review of the payroll information charged to the grant during fiscal year 2018-2019. The lack of controls was isolated to 2018-2019. 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 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. 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 of the School Corporation 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 compliance requirements listed above. A lack of segregation of duties within an internal control system could also allow noncompliance with the compliance requirements 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 to ensure compliance with the grant agreement and the Activities Allowed or Unallowed and Allowable Costs/Cost Principles compliance requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2019-001 (Auditor Assigned Reference Number) Contact Person Responsible for Corrective Action: Kent Hatcher and Dana DeHart Contact Phone Number: (317) 789-3763 and (317) 789-3796 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: Payroll has been and continues to be reviewed by the Perry Township Schools? Chief Financial Officer, Payroll Supervisor, Payroll Clerk and the Finance Director with every payroll cycle. Reports are documented and approval is signed by each person in the process. Payroll fund assignments are also reviewed on a regular basis and as changes in personnel are made with Human Resources, Payroll and Finance Accounting Team. Beginning in January 2020, after hearing a new suggested requirement at a training seminar, Perry Township Schools began sending the Payroll Register which includes a list of personnel assignments for each Federal Grant to a program area expert for review and documented approval. We will also be reviewing for documented approval all Payroll Registers between July 1, 2019 and December 31, 2019 and make any necessary adjustments retroactive to July 1, 2019. We believe this added layer of review meets the recommendations and requirements listed. Anticipated Completion Date: New process was implemented January 2020 with completion of payroll review for July through December 2019 anticipated by April 30, 2020.
FINDING 2019-002 Subject: Special Education Cluster (IDEA) - Procurement and Suspension and Debarment Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants CFDA Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 14216-051-PN01, 45717-051-PN01, 14217-051-PN01, 18619-051-PN01, 18611-051-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Other Matters 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 Procurement and Suspension and Debarment compliance requirement. The School Corporation was a participating member school corporation of the Southside Special Services of Marion County Special Education Cooperative (Cooperative). The School Corporation designated a fiscal agent from the Cooperative to receive and manage the funding of the special education programs. The School Corporation relied on the Cooperative to comply with the Procurement and Suspension and Debarment compliance requirement; however, because the grant agreements were between the Indiana Department of Education and each member school corporation of the Cooperative, the School Corporation was ultimately responsible for ensuring compliance with the requirements. Procurement The School Corporation had not established effective controls to ensure that proper procurement procedures were followed by the Cooperative. They did not have internal controls in place to ensure that the purchasing methods used by the Cooperative complied with their procurement procedures and applicable state, local, and federal requirements. Additionally, the School Corporation did not have internal controls in place to ensure that the Cooperative properly documented the history of their procurements, including the rationale for method of procurement, selection of contract type, basis for contractor selection, and the basis for the contract price. The Cooperative did not provide price or rate quotes from an adequate number of sources for purchases of goods or services costing $3,500 to $150,000, which fell within the small purchase procedures. The Cooperative also did not document the rationale for the method of procurement in cases where competition was limited and that the limitation was justified. The Cooperative did not provide bid documentation for a contract with a vendor that exceeded the 'Simplified Acquisition' dollar amount of $150,000. Full and open competition could not be substantiated for the $293,307 paid to this vendor during July 1, 2017 through June 30, 2018. Suspension and Debarment The Cooperative did not have internal controls in place to ensure contracted vendors that exceeded $25,000 in the aggregate were not suspended or debarred from participation in the federal program. The Cooperative entered into one contract with a vendor that exceeded $25,000. They did not perform any procedures to verify that the vendor was not suspended or debarred, or otherwise excluded from, or ineligible for, participation in the federal program prior to the contract. The lack of controls was isolated to fiscal year 2017-2018. 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 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. 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 200.318(i) states: "The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to the following: rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price." 2 CFR 200.320 states in part: "The non-Federal Entity must use one of the following methods of procurement. . . . (b) Procurement by small purchase procedures. Small purchase procedures are those relatively simple and informal procurement methods for securing services, supplies, or other property that do not cost more than the Simplified Acquisition Threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources. . . ." 2 CFR 180.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking the SAM Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person." Cause Management had not developed a system of internal controls that would have ensured compliance with the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Effect The failure to establish an effective internal control system enabled material noncompliance to remain undetected. Noncompliance with the grant agreement and the Procurement and Suspension and Debarment compliance requirement could have resulted in the loss of federal funds to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish controls and implement procedures to ensure compliance with the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Show full finding ▾Hide full finding ▴FINDING 2019-002 Subject: Special Education Cluster (IDEA) - Procurement and Suspension and Debarment Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants CFDA Numbers: 84.027, 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 14216-051-PN01, 45717-051-PN01, 14217-051-PN01, 18619-051-PN01, 18611-051-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Other Matters 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 Procurement and Suspension and Debarment compliance requirement. The School Corporation was a participating member school corporation of the Southside Special Services of Marion County Special Education Cooperative (Cooperative). The School Corporation designated a fiscal agent from the Cooperative to receive and manage the funding of the special education programs. The School Corporation relied on the Cooperative to comply with the Procurement and Suspension and Debarment compliance requirement; however, because the grant agreements were between the Indiana Department of Education and each member school corporation of the Cooperative, the School Corporation was ultimately responsible for ensuring compliance with the requirements. Procurement The School Corporation had not established effective controls to ensure that proper procurement procedures were followed by the Cooperative. They did not have internal controls in place to ensure that the purchasing methods used by the Cooperative complied with their procurement procedures and applicable state, local, and federal requirements. Additionally, the School Corporation did not have internal controls in place to ensure that the Cooperative properly documented the history of their procurements, including the rationale for method of procurement, selection of contract type, basis for contractor selection, and the basis for the contract price. The Cooperative did not provide price or rate quotes from an adequate number of sources for purchases of goods or services costing $3,500 to $150,000, which fell within the small purchase procedures. The Cooperative also did not document the rationale for the method of procurement in cases where competition was limited and that the limitation was justified. The Cooperative did not provide bid documentation for a contract with a vendor that exceeded the 'Simplified Acquisition' dollar amount of $150,000. Full and open competition could not be substantiated for the $293,307 paid to this vendor during July 1, 2017 through June 30, 2018. Suspension and Debarment The Cooperative did not have internal controls in place to ensure contracted vendors that exceeded $25,000 in the aggregate were not suspended or debarred from participation in the federal program. The Cooperative entered into one contract with a vendor that exceeded $25,000. They did not perform any procedures to verify that the vendor was not suspended or debarred, or otherwise excluded from, or ineligible for, participation in the federal program prior to the contract. The lack of controls was isolated to fiscal year 2017-2018. 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 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. 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 200.318(i) states: "The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to the following: rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price." 2 CFR 200.320 states in part: "The non-Federal Entity must use one of the following methods of procurement. . . . (b) Procurement by small purchase procedures. Small purchase procedures are those relatively simple and informal procurement methods for securing services, supplies, or other property that do not cost more than the Simplified Acquisition Threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources. . . ." 2 CFR 180.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking the SAM Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person." Cause Management had not developed a system of internal controls that would have ensured compliance with the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Effect The failure to establish an effective internal control system enabled material noncompliance to remain undetected. Noncompliance with the grant agreement and the Procurement and Suspension and Debarment compliance requirement could have resulted in the loss of federal funds to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish controls and implement procedures to ensure compliance with the grant agreement and the Procurement and Suspension and Debarment 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 2019-002 (Auditor Assigned Reference Number) Contact Person Responsible for Corrective Action: Kent Hatcher and Dana DeHart Contact Phone Number: (317) 789-3763 and (317) 789-3796 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: Perry Township Schools is no longer a participating member school of the Southside Special Services of Marion County Special Education Cooperative (Cooperative). Perry Township Schools has established proven and tested effective controls to ensure proper procurement procedures are followed in our programs. Our new Special Education Director works within the Federal Procurement guidelines and direction provided by the Indiana Department of Education including proper bid, selection, suspension and debarment protocols. Perry Township Schools relationship with the Cooperative ended on July 1, 2018. Anticipated Completion Date: Corrected as of July 1, 2019.
FINDING 2019-003 Subject: Title I Grants to Local Educational Agencies - Special Tests and Provisions - Annual Report Card, High School Graduation Rate Federal Agency: Department of Education Federal Program: Title I Grants to Local Educational Agencies CFDA Number: 84.010 Federal Award Numbers and Years (or Other Identifying Numbers): S010A170014, S010A180014, S010A150014 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Special Tests and Provisions - Annual Report Card, High School Graduation Rate Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system, which would include segregation of duties, 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 - Annual Report Card, High School Graduation Rate compliance requirement. Supporting documentation was not consistently maintained for students who were removed from the graduation cohort. For 15 of the 40 students examined who were removed from the graduation cohort, evidence of oversight and review was not provided, and the required supporting documentation was not maintained. The lack of controls and noncompliance were systemic issues that occurred 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 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. 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). . . ." 34 CFR 200.19(b)(1)(ii)(B) states in part: "To remove a student from the cohort, a school or LEA must confirm in writing that the student transferred out, emigrated to another country, or is deceased. (1) To confirm that a student transferred out, the school or LEA must have official written documentation that the student enrolled in another school or in an educational program that culminates in the award of a regular high school diploma. . . ." Cause Management of the School Corporation had not developed a system of internal controls that would have ensured compliance with the Special Tests and Provisions - Annual Report Card, High School Graduation Rate compliance requirement. Effect The failure to establish an effective internal control system enabled material noncompliance to go undetected. The failure to comply with the grant agreement and the compliance requirement could have resulted in the loss of federal funds to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls, related to the grant agreement and Special Tests and Provisions - Annual Report Card, High School Graduation Rate compliance requirement and retain documentation for all students who withdraw from the School Corporation. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Show full finding ▾Hide full finding ▴FINDING 2019-003 Subject: Title I Grants to Local Educational Agencies - Special Tests and Provisions - Annual Report Card, High School Graduation Rate Federal Agency: Department of Education Federal Program: Title I Grants to Local Educational Agencies CFDA Number: 84.010 Federal Award Numbers and Years (or Other Identifying Numbers): S010A170014, S010A180014, S010A150014 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Special Tests and Provisions - Annual Report Card, High School Graduation Rate Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system, which would include segregation of duties, 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 - Annual Report Card, High School Graduation Rate compliance requirement. Supporting documentation was not consistently maintained for students who were removed from the graduation cohort. For 15 of the 40 students examined who were removed from the graduation cohort, evidence of oversight and review was not provided, and the required supporting documentation was not maintained. The lack of controls and noncompliance were systemic issues that occurred 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 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. 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). . . ." 34 CFR 200.19(b)(1)(ii)(B) states in part: "To remove a student from the cohort, a school or LEA must confirm in writing that the student transferred out, emigrated to another country, or is deceased. (1) To confirm that a student transferred out, the school or LEA must have official written documentation that the student enrolled in another school or in an educational program that culminates in the award of a regular high school diploma. . . ." Cause Management of the School Corporation had not developed a system of internal controls that would have ensured compliance with the Special Tests and Provisions - Annual Report Card, High School Graduation Rate compliance requirement. Effect The failure to establish an effective internal control system enabled material noncompliance to go undetected. The failure to comply with the grant agreement and the compliance requirement could have resulted in the loss of federal funds to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls, related to the grant agreement and Special Tests and Provisions - Annual Report Card, High School Graduation Rate compliance requirement and retain documentation for all students who withdraw from the School Corporation. 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 (Auditor Assigned Reference Number) Contact Person Responsible for Corrective Action: Kent Hatcher and Jane Pollard Contact Phone Number: (317) 789-3763 and (317) 789-3777 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: Perry Township Schools has recently changed our procedure for student removal from our Graduation Cohorts. Starting with the 2019-2020 school year, and the 2020 Cohort, we have implemented the Indiana Department of Education (IDOE) requirements and guidelines. Our procedures were reviewed by the IDOE when they audited our 2019 Graduation Cohort. In response to that Graduation Cohort Audit we have implemented changes that address this finding and have corrected our procedures. We will monitor changes in the Federal Requirements and the State IDOE guidance to ensure any future changes are incorporated into our procedures. Anticipated Completion Date: Corrected as of July 1, 2019, currently in place for the 2020 Student Cohort.
FINDING 2019-004 Subject: Child Nutrition Cluster - Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Program Income, Eligibility Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Special Milk Program for Children, Summer Food Service Program for Children CFDA Numbers: 10.553, 10.555, 10.556, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY 17-18, FY 18-19 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/ Cost Principles, Program Income, Eligibility Audit Finding: Material Weakness Condition and Context An effective internal control system, which would include segregation of duties, was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Program Income, and Eligibility compliance requirements. Activities Allowed or Unallowed, Allowable Costs/Cost Principles The School Corporation had not established an internal control system to ensure that payroll to salaried employees and benefits payments from the School Lunch fund were allowable activities and allowable costs. Program Income The School Corporation had not established an effective internal control system to ensure that program income was properly assessed in accordance with grant requirements. Eligibility The School Corporation had not properly designed and implemented internal controls over Eligibility for free and reduced price applications. Paper application information was input into the Department's software system with final review and approval from the Director of Child Nutrition Services; however, there was no documentation to determine this process was consistently followed. The lack of controls was a systemic issue, which occurred 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 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. 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 of the School Corporation 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 compliance requirements listed above. A lack of segregation of duties within an internal control system could also allow noncompliance with the compliance requirements 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 Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Program Income, and Eligibility compliance requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Show full finding ▾Hide full finding ▴FINDING 2019-004 Subject: Child Nutrition Cluster - Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Program Income, Eligibility Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Special Milk Program for Children, Summer Food Service Program for Children CFDA Numbers: 10.553, 10.555, 10.556, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY 17-18, FY 18-19 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/ Cost Principles, Program Income, Eligibility Audit Finding: Material Weakness Condition and Context An effective internal control system, which would include segregation of duties, was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Program Income, and Eligibility compliance requirements. Activities Allowed or Unallowed, Allowable Costs/Cost Principles The School Corporation had not established an internal control system to ensure that payroll to salaried employees and benefits payments from the School Lunch fund were allowable activities and allowable costs. Program Income The School Corporation had not established an effective internal control system to ensure that program income was properly assessed in accordance with grant requirements. Eligibility The School Corporation had not properly designed and implemented internal controls over Eligibility for free and reduced price applications. Paper application information was input into the Department's software system with final review and approval from the Director of Child Nutrition Services; however, there was no documentation to determine this process was consistently followed. The lack of controls was a systemic issue, which occurred 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 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. 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 of the School Corporation 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 compliance requirements listed above. A lack of segregation of duties within an internal control system could also allow noncompliance with the compliance requirements 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 Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Program Income, and Eligibility compliance requirements. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2019-004 (Auditor Assigned Reference Number) Contact Person Responsible for Corrective Action: Kent Hatcher and Erin Coleman Contact Phone Number: (317) 789-3763 and (317) 789-3745 Views of Responsible Official: We concur with the finding. Allowable Activities, Allowable Costs/Cost Principles: Description of Corrective Action Plan: Payroll has been and continues to be reviewed by the Perry Township Schools Chief Financial Officer, Payroll Supervisor, Payroll Clerk and the Finance Director with every payroll cycle. Reports are documented and approval is signed by each person in the process. Payroll fund assignments are also reviewed on a regular basis and as changes in personnel are made with Human Resources, Payroll and Finance Accounting Team. Beginning in January 2020, after hearing a new suggested requirement at a training seminar, Perry Township Schools began sending the Payroll Register which includes a list of personnel assignments for each Federal Grant to a program area expert for review and documented approval. We will also be reviewing for documented approval all Payroll Registers between July 1, 2019 and December 31, 2019 and make any necessary adjustments retroactive to July 1, 2019. We believe this added layer of review meets the recommendations and requirements listed. Anticipated Completion Date: New process was implemented January 2020 with completion of payroll review for July through December 2019 anticipated by April 30, 2020. Program Income: Description of Corrective Action Plan: Our new Child Nutrition Director has already established a written procedure to address this issue. The Child Nutrition Director provides pricing change requests to our Information Technology Staff. The Technology Staff make the changes in our software system and respond that the changes have been made. The Child Nutrition Director logs into the system and verifies the changes, prints a confirmation of the changes, signs and dates the confirmation and retains on file. Anticipated Completion Date: Effective July 1, 2019. Eligibility: Description of Corrective Action Plan: The Child Nutrition Department will implement a change to current procedures to address this finding. Currently a Nutrition staff member enters the information from the paper application into our software system. They will now begin printing a confirmation page with each application entered. They will initial the confirmation page and pass the documentation to another, separate, Child Nutrition Employee who will confirm the information. They will verify that the data from the paper application was entered correctly. They will initial the confirmation page if all data entry is correct. If any incorrect information is noted it will be corrected in the system and a new confirmation page will be initialed by both Child Nutrition staff members. This will assure that all information entered from each paper application is reviewed and documented by multiple staff. The confirmation page, with initials, will be filed with the original application materials. Anticipated Completion Date: Effective March 3, 2020.
FINDING 2019-005 Subject: Child Nutrition Cluster - Procurement Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Special Milk Program for Children, Summer Food Service Program for Children CFDA Numbers: 10.553, 10.555, 10.556, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY 17-18, FY 18-19 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system, which would include segregation of duties, was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Procurement and Suspension and Debarment compliance requirement. The School Corporation did not comply with the procurement requirements for small purchases during fiscal year 2017-2018 or 2018-2019. The School Corporation purchased goods without the appropriate procurement procedures in place. The School Corporation did not obtain price or rate quotes from an adequate number of sources for purchases of goods or services exceeding $3,500, but under $150,000 in 2017-2018 or exceeding $10,000, but under $150,000 in 2018-2019, which fell under the small purchase procedures. The lack of controls and noncompliance were systemic issues that occurred 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 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. 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 200.320 states in part: "The non-Federal Entity must use one of the following methods of procurement . . . (b) Procurement by small purchase procedures. Small purchase procedures are those relatively simple and informal procurement methods for securing services, supplies, or other property that do not cost more than the Simplified Acquisition Threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources. . . ." Cause The School Corporation's management had not developed a system of internal controls that would have ensured compliance with the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Effect The failure to establish an effective internal control system enabled material noncompliance to go undetected. The failure to comply with the grant agreement and the compliance requirement could have resulted in the loss of federal funds to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls to ensure compliance and comply with the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Show full finding ▾Hide full finding ▴FINDING 2019-005 Subject: Child Nutrition Cluster - Procurement Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Special Milk Program for Children, Summer Food Service Program for Children CFDA Numbers: 10.553, 10.555, 10.556, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY 17-18, FY 18-19 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system, which would include segregation of duties, was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Procurement and Suspension and Debarment compliance requirement. The School Corporation did not comply with the procurement requirements for small purchases during fiscal year 2017-2018 or 2018-2019. The School Corporation purchased goods without the appropriate procurement procedures in place. The School Corporation did not obtain price or rate quotes from an adequate number of sources for purchases of goods or services exceeding $3,500, but under $150,000 in 2017-2018 or exceeding $10,000, but under $150,000 in 2018-2019, which fell under the small purchase procedures. The lack of controls and noncompliance were systemic issues that occurred 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 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. 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 200.320 states in part: "The non-Federal Entity must use one of the following methods of procurement . . . (b) Procurement by small purchase procedures. Small purchase procedures are those relatively simple and informal procurement methods for securing services, supplies, or other property that do not cost more than the Simplified Acquisition Threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources. . . ." Cause The School Corporation's management had not developed a system of internal controls that would have ensured compliance with the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Effect The failure to establish an effective internal control system enabled material noncompliance to go undetected. The failure to comply with the grant agreement and the compliance requirement could have resulted in the loss of federal funds to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a system of internal controls to ensure compliance and comply with the grant agreement and the Procurement and Suspension and Debarment 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 2019-005 (Auditor Assigned Reference Number) Contact Person Responsible for Corrective Action: Kent Hatcher and Erin Coleman Contact Phone Number: (317) 789-3763 and (317) 789-3745 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: Our new Child Nutrition Director has already implemented changes to our Nutrition Departments Procurement procedures for all Goods and Equipment. All Procurement activity for the Department is now approved by the Child Nutrition Director. Documentation of competition and selection will be maintained for each Procurement as outlined by the USDA Procurement Guidelines and as directed by the Indiana Department of Education. Each Procurement will include review by the Assistant Director and final approval by the Director. Each Procurement will include the required Suspension and Debarment testing. This process is currently in place for all Goods and Equipment and will need to be updated for Service Agreements. Anticipated Completion Date: Service Agreements will be bid by May 1, 2020.
FINDING 2019-006 Subject: Child Nutrition Cluster - Special Tests and Provisions - Paid Lunch Equity Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Special Milk Program for Children, Summer Food Service Program for Children CFDA Numbers: 10.553, 10.555, 10.556, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY 17-18, FY 18-19 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Special Tests and Provisions - Paid Lunch Equity Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system, which would include segregation of duties, 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 - Paid Lunch Equity compliance requirement. The School Corporation performed and retained the paid lunch equity calculation for both school years in the audit period. However, the calculation for fiscal year 2017-2018 did not agree with the supporting documentation. The paid lunch equity calculation for 2017-2018 was based on the total number of paid lunches from October 2016. The total number of elementary paid lunches was 708 more on the paid lunch equity calculation than on the reimbursement claim from October 2016. The lack of controls was isolated to 2017-2018. 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 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. 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). . . ." 7 CFR 210.14(e) states in part: "Pricing paid lunches. For each school year beginning July 1, 2011, school food authorities shall establish prices for paid lunches in accordance with this paragraph. (1) Calculation procedures. Each school food authority shall: (i) Determine the average price of paid lunches. The average shall be determined based on the total number of paid lunches claimed for the month of October in the previous school year, at each different price charged by the school food authority. (ii) Calculate the difference between the per meal Federal reimbursement for paid and free lunches received by the school food authority in the previous school year (i.e., the reimbursement difference); (iii) Compare the average price of a paid lunch under paragraph (e)(1)(i) of this section to the difference between reimbursement rates under paragraph (e)(1)(ii) of this section. . . . (3) Average lunch price is lower than the reimbursement difference. When the average price from the prior school year is lower than the difference in reimbursement rates as determined in paragraph (e)(1)(iii) of this section, the school food authority shall establish an average price for the current school year that is not less than the average price charged in the previous school year as adjusted by a percentage equal to the sum obtained by adding: (i) 2 percent; and (ii) The percentage change in the Consumers Price Index for All Urban Consumers used to increase the Federal reimbursement rate under section 11 of the Act for the most recent school year for which data are available. The percentage to be used is found in the annual notice published in the FEDERAL REGISTER announcing the national average payment rates, from the prior year. (4) Price Adjustments. (i) Maximum required price increase. The maximum annual average price increase required under this paragraph shall not exceed ten cents. (ii) Rounding of paid lunch prices. Any school food authority may round the adjusted price of the paid lunches down to the nearest five cents. (iii) Optional price increases. A school food authority may increase the average price by more than ten cents. . . ." Cause The School Corporation's management had not developed a system of internal controls that would have ensured compliance with the grant agreement and the Special Tests and Provisions - Paid Lunch Equity compliance requirement. 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 requirement listed above. 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 compliance requirement listed above. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Show full finding ▾Hide full finding ▴FINDING 2019-006 Subject: Child Nutrition Cluster - Special Tests and Provisions - Paid Lunch Equity Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Special Milk Program for Children, Summer Food Service Program for Children CFDA Numbers: 10.553, 10.555, 10.556, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY 17-18, FY 18-19 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Special Tests and Provisions - Paid Lunch Equity Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system, which would include segregation of duties, 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 - Paid Lunch Equity compliance requirement. The School Corporation performed and retained the paid lunch equity calculation for both school years in the audit period. However, the calculation for fiscal year 2017-2018 did not agree with the supporting documentation. The paid lunch equity calculation for 2017-2018 was based on the total number of paid lunches from October 2016. The total number of elementary paid lunches was 708 more on the paid lunch equity calculation than on the reimbursement claim from October 2016. The lack of controls was isolated to 2017-2018. 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 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. 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). . . ." 7 CFR 210.14(e) states in part: "Pricing paid lunches. For each school year beginning July 1, 2011, school food authorities shall establish prices for paid lunches in accordance with this paragraph. (1) Calculation procedures. Each school food authority shall: (i) Determine the average price of paid lunches. The average shall be determined based on the total number of paid lunches claimed for the month of October in the previous school year, at each different price charged by the school food authority. (ii) Calculate the difference between the per meal Federal reimbursement for paid and free lunches received by the school food authority in the previous school year (i.e., the reimbursement difference); (iii) Compare the average price of a paid lunch under paragraph (e)(1)(i) of this section to the difference between reimbursement rates under paragraph (e)(1)(ii) of this section. . . . (3) Average lunch price is lower than the reimbursement difference. When the average price from the prior school year is lower than the difference in reimbursement rates as determined in paragraph (e)(1)(iii) of this section, the school food authority shall establish an average price for the current school year that is not less than the average price charged in the previous school year as adjusted by a percentage equal to the sum obtained by adding: (i) 2 percent; and (ii) The percentage change in the Consumers Price Index for All Urban Consumers used to increase the Federal reimbursement rate under section 11 of the Act for the most recent school year for which data are available. The percentage to be used is found in the annual notice published in the FEDERAL REGISTER announcing the national average payment rates, from the prior year. (4) Price Adjustments. (i) Maximum required price increase. The maximum annual average price increase required under this paragraph shall not exceed ten cents. (ii) Rounding of paid lunch prices. Any school food authority may round the adjusted price of the paid lunches down to the nearest five cents. (iii) Optional price increases. A school food authority may increase the average price by more than ten cents. . . ." Cause The School Corporation's management had not developed a system of internal controls that would have ensured compliance with the grant agreement and the Special Tests and Provisions - Paid Lunch Equity compliance requirement. 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 requirement listed above. 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 compliance requirement listed above. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2019-006 (Auditor Assigned Reference Number) Contact Person Responsible for Corrective Action: Kent Hatcher and Erin Coleman Contact Phone Number: (317) 789-3763 and (317) 789-3745 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: As mentioned in the finding this is an isolated incident that only occurred for one monthly claim in October 2016. Our new Child Nutrition Director reviews all claims prior to submission and now also utilizes the Assistant Director to review the numbers for accuracy. Both individuals document and sign each claim. A tracking sheet has also been developed to compare the claims submitted and paid by the Indiana Department of Education with our documented numbers. Anticipated Completion Date: Corrected as of July 1, 2019
FAC accepted this audit on February 3, 2019 — management decision was due August 3, 2019.
GSA_MIGRATION
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GSA_MIGRATION
2015-004
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GSA_MIGRATION
2015-004
GSA_MIGRATION
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2015-007
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