Independent School District No 273

SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE – U.S. DEPARTMENT OF EDUCATION, PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, SPECIAL EDUCATION CLUSTER – FEDERAL ALN 84.027 (INCLUDING COVID-19 FUNDING) AND 84.173 2024-001 Internal Control Over Compliance with Federal Suspension and Debarment Requirements Criteria – 2 CFR § 180 requires Independent School District No. 273 (the District) to establish and maintain effective internal control over compliance with requirements applicable to federal programs expenditures, including suspension and debarment requirements applicable to special education cluster federal program expenditures. Condition – During our audit, we noted the District did not have sufficient controls in place within its special education cluster to assure it was not contracting for goods or services with parties that are suspended or debarred, or whose principals are suspended or debarred from participating in contracts involving the expenditures of federal program funds. Questioned Costs – None. Our testing did not indicate any instances of noncompliance with this requirement. Context – The District did not obtain appropriate timely documentation for one of two vendors tested that the vendor was not suspended or debarred from participating in federal program contracts. This was not a statistically valid sample. Repeat Finding – This is a current year finding. Cause – For one vendor tested, the District did not review and document vendor eligibility until after expenditures had been paid to the vendor in excess of the $25,000 threshold. Effect - Noncompliance with the procurement requirements could result in the District expending federal funds inappropriately or utilizing vendors that are not eligible to be parties to such transactions, which could be viewed as a violation of the award agreement. Recommendation – We recommend that the District review its internal control procedures relating to suspension and debarment applicable to its special education cluster federal programs. Internal controls over compliance for this area should include timely verification that any vendor with which the District contracts for goods or services exceeding $25,000 is not listed as suspended or debarred on the federal Excluded Parties List System website. View of Responsible Official and Planned Corrective Actions – The District agrees with the finding. The District will update its policies and procedures relating to suspension and debarment to ensure that, in the future, compliance with this requirement is verified and documented prior to expending $25,000 or more of federal funds with any single vendor. The District has issued a separate Corrective Action Plan related to this finding.

SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE ? U.S. DEPARTMENT OF EDUCATION, PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, SPECIAL EDUCATION CLUSTER ? FEDERAL ALN 84.027 AND 84.173 2022-002 Internal Control Over Compliance With Federal Suspension and Debarment Requirements Criteria ? 2 CFR ? 180 requires the District to establish and maintain effective internal control over compliance with requirements applicable to federal program expenditures, including suspension and debarment requirements applicable to the special education cluster federal programs. Condition ? During our audit, we noted the District did not have sufficient controls in place within its special education cluster federal programs to assure that it was not contracting for goods or services with parties that are suspended or debarred, or whose principals are suspended or debarred from participating in contracts involving the expenditures of federal program funds. Questioned Costs ? None. Our testing did not indicate any instances of noncompliance with these requirements. Context ? The District did not obtain the appropriate documentation for three of three vendors tested to ensure the vendors were not suspended or debarred from participation in federal program contracts. This was not a statistically valid sample. Repeat Finding ? This is a current year finding. Cause ? This was an oversight by district personnel. Effect ? Noncompliance with the suspension and debarment requirements could result in the District expending federal funds with vendors that are not eligible to be parties to such transactions, which could be viewed as a violation of the award agreement. Recommendation ? We recommend that the District review its internal control procedures relating to suspension and debarment for all federal programs. Internal controls over compliance for this area should include verification that any vendor with which the District contracts for goods or services exceeding $25,000 is not listed as suspended or debarred on the federal Excluded Parties List System website. View of Responsible Official and Planned Corrective Actions ? The District agrees with the finding. The District will review and update its policies and procedures relating to suspension and debarment for its federal programs to ensure compliance with the Uniform Guidance in the future. The District has separately issued a Corrective Action Plan related to this finding.

SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE ? U.S. DEPARTMENT OF AGRICULTURE, PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, CHILD NUTRITION CLUSTER ? CFDA NOS. 10.553, 10.555, AND 10.559 2020-002 Internal Control Over Compliance With Federal Suspension and Debarment Requirements Criteria ? 2 CFR ? 180 requires the District to establish and maintain effective internal control over compliance with requirements applicable to federal program expenditures, including suspension and debarment requirements applicable to the child nutrition cluster federal program. Condition ? During our audit, we noted the District did not have sufficient controls in place within its child nutrition cluster federal programs to assure that it was not contracting for goods or services with parties that are suspended or debarred, or whose principals are suspended or debarred from participating in contracts involving the expenditures of federal program funds. For one of two vendors tested, the District did not have the required documentation of vendor checks as required by Uniform Guidance. Questioned Costs ? None. Our testing did not indicate any instances of noncompliance with these requirements. Context ? The District did not obtain the appropriate documentation for one of two vendors tested to ensure the vendor was not suspended or debarred from participation in federal program contracts. Repeat Finding ? This is a current year finding. Cause ? This was an oversight by district personnel. Effect ? Noncompliance with the suspension and debarment requirements could result in the District expending federal funds with vendors that are not eligible to be parties to such transactions, which could be viewed as a violation of the award agreement. However, no instances of noncompliance were noted upon testing these vendors. Recommendation ? We recommend that the District review its internal control procedures relating to suspension and debarment for the child nutrition cluster federal program. Internal controls over compliance for this area should include verification that any vendor with which the District contracts for goods or services exceeding $25,000 is not listed as suspended or debarred on the federal Excluded Parties List System website. View of Responsible Official and Planned Corrective Actions ? The District agrees with the finding. The District will review and update its policies and procedures relating to suspension and debarment for its federal programs to ensure compliance with the Uniform Guidance in the future. The District has separately issued a Corrective Action Plan related to this finding.

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