Fremont School District No. 79Local Government

Federal Program Name: Coronavirus Response and Relief Supplemental Appropriation Act; Project Number: 10-4998-E2; AL Number: 84.425; Pass Through Entity: Illinois State Board of Education; Criteria/Specific Requirement: Per OMB Compliance Supplement, Part 3 - Compliance Requirements, Section L - Reporting, one of the audit objectives is to "Determine whether the required reports for federal awards included all activity of the reporting period, are supported by applicable accounting or performance records, and are fairly presented in accordance with governing requirements."; Condition: While the District accounting system was effectively designed to allow for proper functional classification of expenditures, the expenditure classifications were not used appropriately. As a result, functions did not match that were reported to ISBE for drawing down funds creating misstatements in the expenditure reports; Questioned Costs: N/A; Context: Expenditure reports were submitted to ISBE with incorrect data; Effect: Failure to report expenditures in the same function used to report expenditures to ISBE causes misstatements in the reports and incorrect reimbursements; Cause: While expenditures were correctly approved through the grant program, misclassifications of expenditures led to improper reimbursement requests; Recommendation: The District needs to ensure that all expenditures are properly recorded in the function that is ultimately reported to ISBE. Management's Response: The District has instituted review procedures and made staffing changes to facilitate preparing correct expenditure reports to ISBE.

Federal Program Name: Coronavirus Response and Relief Supplemental Appropriation Act; Project Number: 10-4998-E3; AL Number: 84.425; Pass Through Entity: Illinois State Board of Education; Criteria/Specific Requirement: Per OMB Compliance Supplement, Part 3 - Compliance Requirements, Section L - Reporting, one of the audit objectives is to "Determine whether the required reports for federal awards included all activity of the reporting period, are supported by applicable accounting or performance records, and are fairly presented in accordance with governing requirements."; Condition: While the District accounting system was effectively designed to allow for proper functional classification of expenditures, the expenditure classifications were not used appropriately. As a result, functions did not match that were reported to ISBE for drawing down funds creating misstatements in the expenditure reports; Questioned Costs: There were $19,428 of duplicate expenditures resulting in overclaimed expenditures; Context: Expenditure reports were submitted to ISBE with incorrect data; Effect: Failure to record expenditures in the same function used to report expenditures to ISBE causes misstatements in the reports and incorrect reimbursements; Cause: While expenditures were correctly approved through the grant program, misclassifications of expenditures led to improper reimbursement requests; Recommendation: The District needs to ensure that all expenditures are properly recorded in the function that is ultimately reported to ISBE; Management's Response: The District has instituted review procedures and made staffing changes to facilitate preparing correct expenditure reports to ISBE.

FREMONT SCHOOL DISTRICT NO. 79 44-063-1580-22 SCHEDULE OF FINDINGS AND QUESTIONED COSTS Year Ending June 30, 2022 SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS 1. FINDING NUMBER:14 2022- 001 2. THIS FINDING IS: x New Repeat from Prior year? Year originally reported? 3. Federal Program Name and Year: Coronavirus Response and Relief Supplemental Appropriation Act 4. Project No.: 10-4998-E2 5. CFDA No.: 84.425 6. Passed Through: Illinois State Board of Education 7. Federal Agency: 8. Criteria or specific requirement (including statutory, regulatory, or other citation) Per OMB Compliance Supplement, Part 3 - Compliance Requirements, Section L - Reporting, one of the audit objectives is to "Determine whether the required reports for Federal Awards include all activity of the reporting period, are supported by applicable accounting or performance records, and are fairly spresented in accordance with governing requirements." 9. Condition15 While the District's accounting system was effectively designed to allow for proper functional classification of expenditures , the expenditure classifications were not used appropriately. As a result, functions did not match the functions that were reported to ISBE for drawing down funds creating misstatements in the expenditure reports. 10. Questioned Costs16 N/A 11. Context17 Expenditure reports were submitted to ISBE with incorrect data. 12. Effect Failure to record expenditures in the same function used to report expenditures to ISBE causes misstatements in the reports and incorrect reimbursements. 13. Cause While expenditures were correctly approved through the grant program, misclassifications of expenses led to improper reimbursement requests. 14. Recommendation The District needs to ensure that all expenditures are properly recorded in the function that is ultimately reported to ISBE. 15. Management's response18 The District will institute stricter review procedures to assist in preparing correct expnditure reports to ISBE. 14 See footnote 11. 15 Include facts that support the deficiency identified on the audit finding (?200.516 (b)(3)). 16 Identify questioned costs as required by ?200.516 (a)(3 - 4). 17 See footnote 12. 18 To the extent practical, indicate when management does not agree with the finding, questioned cost, or both.