Clintondale Community Schools

Program Name – Title I (ALN 84.010) Pass-through Entity ¬– Michigan Department of Education Finding Type – Cash Management (Material Weakness) Criteria – Requests for cash reimbursements for the program should not occur before expenditures have been incurred. Condition – The District requested cash reimbursement in excess of expenditures for the program listed above. Questioned Costs – $55,945 Context – The District had requested cash reimbursement without first incurring the necessary expenditures. Cause/Effect – The District requested cash in excess of expenditures in the amount of $55,945. Recommendation – We recommend that the district has an additional responsible party who has knowledge of the grant review the transactions and any adjustments to the amounts charged to the grant before reimbursement requests are made. Views of responsible official(s) of the auditee – See corrective action plan.

Program Name – ESSER III Formula (ALN 84.425U) Pass-through Entity ¬– Michigan Department of Education Finding Type – Allowable Costs (Material Weakness) Criteria – The district did not fully liquidate expenditures by 12/30/24. Condition – The district prepaid for professional development that never occurred. The vendor never received payment and instead applied the payment to a replacement service that occurred after the 12/30/24 deadline. Questioned Costs – $56,400 Context – The district prepaid for professional development that never occurred. The vendor never received payment and instead applied the payment to a replacement service that occurred after the 12/30/24 deadline. Cause/Effect – The District requested cash reimbursement based upon unallowable costs. Recommendation – We recommend that the district has an additional responsible party who has knowledge of the grant review the transactions and any adjustments to the amounts charged to the grant before reimbursement requests are made. Views of responsible official(s) of the auditee – See corrective action plan.

Program Name – ESSER III Formula (ALN 84.425U) Pass-through Entity ¬– Michigan Department of Education Finding Type – Cash Management (Material Weakness) Criteria – Requests for cash reimbursements for the program should not occur before expenditures have been incurred. Condition – The District requested cash reimbursement in excess of expenditures for the program listed above. Questioned Costs – $26,734 Context – The district did not properly identify expenditures by state & responsibility code and received revenue in excess of expenditures for the program noted above. Cause/Effect – The District requested cash in excess of expenditures in the amount of $26,734. Recommendation – We recommend that the district has an additional responsible party who has knowledge of the grant review the transactions and any adjustments to the amounts charged to the grant before reimbursement requests are made. Views of responsible official(s) of the auditee – See corrective action plan.

The District had requested cash reimbursement without first incurring the necessary expenditures.

Subsequent to the final draw request, the District posted journal entries to remove 147c retirement expenses that were accrued. This resulted in a reduction of total Flowthrough expenses that caused the grant revenues to be greater than expenses.

Due to a lack of awareness/understanding, internal control deficiency, time constraint or administrative oversight, the district failed to meet the federal bidding requirements.

Finding 2023-002 Program Name – Title I Regional Assistance (ALN 84.010) Pass-through Entity ¬– Macomb Intermediate School District Finding Type – Period of Performance (Material Weakness) Criteria – Expenditures must be recorded in the proper period as incurred Condition – The district included a prepayment of an expenditure applicable to the subsequent period in the current period draws. Questioned Costs – $32,000. Context – The audit finding appears to be an isolated incident as no other similar incidents were identified during audit procedures. Cause/Effect – $32,000 of excess expenditures not applicable to the current period. Recommendation: We recommend that the District has a responsible party who has knowledge of the grant review the transactions prior to approval.

Finding 2022-002 Program Name ? Title I (ALN 84.010) Pass-through Entity ?? Michigan Department of Education Finding Type ? Cash Management (Material Weakness) Criteria ? Requests for cash reimbursements for the program should not occur before expenditures have been incurred. Amounts for payroll related expenditures were requested before they were actually incurred. Condition ? The District requested cash reimbursement in excess of expenditures for the program listed above. Questioned Costs ? $16,776 Context ? The District had previously overdrawn the 19-20 Title I grant, but was able to still correct the final draw as it was discovered prior to 9/30/20. It appears that the District had included this amount in their 20-21 grant, thus overdrawing the 20-21 year as they did not have sufficient expenses to support the total draws requested. Cause/Effect ? The District requested cash in excess of expenditures in the amount of $16,776. Recommendation: We recommend that the District has an additional responsible party who has knowledge of the grant review the transactions and any adjustments to the amounts charged to the grant before reimbursement requests are made.

Finding 2022-003 Program Name ? GSRP State Fiscal Recovery Funds (ALN 84.425) Pass-through Entity ?? Macomb ISD Finding Type ? Cash Management (Material Weakness) Criteria ? Requests for cash reimbursements for the program should not occur before expenditures have been incurred. Amounts for payroll related expenditures were requested before they were actually incurred. Condition ? The District requested cash reimbursement in excess of expenditures for the program listed above. Questioned Costs ? $1,982 Context ? Subsequent to the final draw request, the District posted journal entries to remove 147c retirement expenses that were accrued. This resulted in a reduction of total GSRP expenses that caused the grant revenues to be greater than expenses. Cause/Effect ? The District requested cash in excess of expenditures in the amount of $1,982. Recommendation: We recommend that the District has an additional responsible party who has knowledge of the grant review the transactions and any adjustments to the amounts charged to the grant before reimbursement requests are made.

Finding 2022-004 Program Name ? Special Education Cluster (ALN 84.027/84.173) Pass-through Entity ?? Macomb ISD Finding Type ? Allowable Costs (Material Weakness) Criteria ? District had material weakness with Allowable Costs requirement of preparing time certifications for employees charged to federal grants. Condition ? The District could not provide semi-annual time certs/PARs. Questioned Costs ? Undeterminable Context ? Due to turnover of key positions, the District neglected to prepare time certifications during the 21-22 year. Cause/Effect ? The potential misstatement is undeterminable Recommendation: We recommend that the District has a responsible party who has knowledge of the federal grants prepare time certifications semi-annually for employees charged to the federal grants.

Finding 2021-001 Program Name ? (Nutrition Cluster) National School Breakfast and National School Lunch, U.S. Department of Agriculture, passed though Michigan Department of Education. CFDA #10.553/10.555/10.559. Pass-through Entity ?? Michigan Department of Education Finding Type - Noncompliance Criteria ? Federal register section 7 CFR Part 210.14b requires school districts to limit its School Breakfast and Lunch Fund net resources to an amount that does not exceed three months average expenditures. Condition ? The District?s net cash resources exceeded three months average expenditures at June 30, 2021. Questioned Costs ? None Context ? The District did not meet the three months average expenditure test at June 30, 2021. Cause/Effect ? Management did not monitor net cash resources to ensure they did not exceed three months average expenditures. Recommendation: We recommend that the District review the Food Service Fund net cash resources periodically to ensure that the fund will not have an excess of three months average expenditures at the fiscal year end. The District should take this requirement into consideration when preparing the annual budget, and any subsequent adjustments to the budget.

Finding 2019-002 (Repeat Finding) Program Name ? (Nutrition Cluster) National School Breakfast and National School Lunch, U.S. Department of Agriculture, passed though Michigan Department of Education. CFDA #10.553/10.555/10.559. Pass-through Entity ?? Michigan Department of Education Finding Type - Noncompliance Criteria ? Federal register section 7 CFR Part 210.14b requires school districts to limit its School Breakfast and Lunch Fund net resources to an amount that does not exceed three months average expenditures. Condition ? The District?s net cash resources exceeded three months average expenditures at June 30, 2019. Questioned Costs ? None Context ? The District did not meet the three months average expenditure test at June 30, 2019. Cause/Effect ? Management did not monitor net cash resources to ensure they did not exceed three months average expenditures. Recommendation: We recommend that the District review the Food Service Fund net cash resources periodically to ensure that the fund will not have an excess of three months average expenditures at the fiscal year end. The District should take this requirement into consideration when preparing the annual budget, and any subsequent adjustments to the budget.

Finding 2019-003 Program Name ? (Special Education Cluster). CFDA #84.027/84.173. Pass-through Entity ?? Macomb Intermediate School District Finding Type ? Cash Management Criteria ? Requests for cash reimbursements for the program should not occur before expenditures have been incurred. Amounts for payroll related expenditures were requested before they were actually incurred. Condition ? The District requested cash reimbursement in excess of expenditures for the programs listed above. Questioned Costs ? $2,983. Context ? Subsequent to the final draw request, the District posted journal entries to remove the employee portion of insurance expenses that were accrued. This resulted in a reduction of total IDEA expenses that caused grant revenues that are greater than expenses. Cause/Effect ? Payroll expenditures were not allocated properly resulting in the District requesting cash in excess of expenditures. Recommendation: We recommend that management review the final expenditures before submitting a request for reimbursement.

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