Prince George's County Public Schools

Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553, 10.555, 10.559 Federal Award Identification Number and Year: 10.CNC Child Nutrition Cluster 2025 Pass-Through Agency: Maryland State Department of Education Pass-Through Numbers: N/A Award Period: 7/1/2024 – 6/30/2025 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: Claims for Reimbursement -Sponsors must submit monthly claims for reimbursement for meals and snacks served to eligible students within 60 days following the last day of the month covered by the claim (7 CFR sections 210.8, 220.11, 215.10, and 225.15(c)). Control: Per 2 CFR section 200.303(a), a non-Federal entity must: 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 comply 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: The November 2024 Reimbursement report applicable to Assistance Listing Numbers 10.553, 10.555, and 10.559 was not approved prior to the submission to the State. Context: PGCPS did not have proper procedures in place regarding review/approval for the month of November 2024 MSDE reimbursement report. Questioned costs: None noted. Cause: Management indicated that the omission of indication of review was due to the lack of oversight. Effect: The absence of a review may increase the risk of errors or inconsistencies in the reports. Recommendation: CLA recommends Prince George’s County Public Schools ensure proper reviews are being conducted and that the review is evidenced by documentation. Views of responsible officials: The School System agrees with the finding and recommendations set forth within. The School System has implemented a review process that includes prepared by and approved by signatures on reimbursements to document the proper segregation of duties and ensure proper oversight and compliance with reporting requirements. Refer to School System’s corrective action plan for further details.

Federal Agency: U.S. Department of Education Federal Program Name: Student Support and Academic Enrichment Program Assistance Listing Number: 84.424 Federal Award Identification Number and Year: 201572 (7/1/19-9/30/22) Award Period: July 1, 2019 through September 30, 2022, Liquidation Date November 30, 2022 Type of Finding: Reporting Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: 2 CFR part 200.502 and 510 states that the auditee must also prepare a schedule of expenditures of Federal awards for the period covered by the auditee's financial statements which must include the total Federal awards expended. Condition: The School System inaccurately reported expenditures of $27,779 on the schedule of expenditures of federal awards. Questioned costs: $27,779 Context: Grant award 201572 (which is tracked in Fund 7010) had a period of performance from July 1, 2019, through September 30, 2022, with a liquidation cut off period of November 30, 2022. On the Annual Financial Report (AFR) submitted to the Maryland State Department of Education (MSDE) in September 2022, the School System reported that the full award amount of $2,665,293 was expended. The School System expensed an additional $22,265 (net of adjustments) to the grant in fiscal year 2023 and an additional $27,799 in fiscal year 2024 to fulfill the $2,665,293 grant award amount. This caused a total amount of $27,779 of disbursements to be reported on the FY24 Schedule of Expenditures and Federal Awards. Cause: Accounting staff identified and processed adjustments subsequent to the period of performance and liquidation period. Effect: The Department was not compliant with the grant’s period of performance which could result in the grantor’s disallowance of the costs. Recommendation: We recommend that the School system review its procedures to ensure that amounts reported on the SEFA are in accordance with 2 CFR part 200.502 and 510. Views of responsible officials: The $27,799 was removed from the FY24 SEFA. In an ongoing effort to ensure that all grants are reported correctly and in line Grant’s Administrator will hold regular meetings (at least quarterly) with the Budget Analyst and/or Grants Accountant assigned to these grant funds. The Grants Accountant will also provide transaction and payroll detail reports to the Grants Administrator on a regular basis for review and correction when necessary.

Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster Assistance Listing Number: 84.027/84.173 Federal Award Identification Number and Year: 21026803 (7/1/20-9/30/22); 22015301 (10/1/20-9/30/22); 21110501 (10/1/20-9/30/22); 21110503 (7/1/20-9/30/22); 22051102 ( 7/1/21-9/30/22); 20028602 ( 7/1/21-9/30/22); Award Period: July 1, 2020 through September 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance – A non-federal entity may charge to the Federal award allowable costs incurred during the period of performance and any costs incurred before the Federal awarding agency or pass-through entity made the Federal award, only to the extent that they would have been allowable if incurred after the date of the Federal award and only with the written approval of the Federal awarding agency. Further, the Uniform Guidance in 2 CFR 200.344(b), states that unless the Federal awarding agency or pass-through entity authorized an extension, a non-Federal entity must liquidate all financial obligations incurred under the Federal award no later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award. Control – Per 2 CFR Section 200.303(a), a non-Federal entity must: 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 comply 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: The Department of Education charged costs to the program that were incurred outside of the grant award’s period of performance. Questioned costs: The total of expenditures charged to the program that were incurred outside of the grant’s period of performance were $63,518. Context: Two of Five expenditure transactions selected for testing, totaling $ 63,518.50, were incurred after the award end date of September 30, 2022. Cause: Accounting staff identified and charged program costs to the incorrect grant. The Program’s review process did not detect the errors nor take timely corrective action. Effect: The Department was not compliant with the grant’s period of performance which could result in the grantor’s disallowance of the costs. Recommendation: We recommend that the Department review its procedures to ensure that expenditures charged to the program are incurred within the grant’s period of performance. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Education Federal Program Name: Special Education-Grants for Infants and Families Assistance Listing Number: 84.181 Federal Award Identification Number and Year: 210299 (07/01/2020–09/30/2021); 220134 (07/01/202-09/30/2022) Award Period: July 1, 2020 through September 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Compliance – A non-federal entity may charge to the Federal award allowable costs incurred during the period of performance and any costs incurred before the Federal awarding agency or pass-through entity made the Federal award, only to the extent that they would have been allowable if incurred after the date of the Federal award and only with the written approval of the Federal awarding agency. Further, the Uniform Guidance in 2 CFR 200.344(b), states that unless the Federal awarding agency or pass-through entity authorized an extension, a non-Federal entity must liquidate all financial obligations incurred under the Federal award no later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award. Control – Per 2 CFR Section 200.303(a), a non-Federal entity must: 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 comply 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: The Department of Education charged costs to the program that were incurred outside of the grant award’s period of performance. Questioned costs: $ 117,646.69, the total of expenditures charged to the program that were incurred outside of the grant’s period of performance. Context: Five of Five expenditure transactions selected for testing, totaling $ 117,646.69, were incurred after the award end date of September 30, 2022. Cause: Accounting staff identified and charged program costs to the incorrect grant. The Program’s review process did not detect the errors nor take timely corrective action. Effect: The Department was not compliant with the grant’s period of performance which could result in the grantor’s disallowance of the costs. Repeat Finding: A similar condition was noted in prior year finding 2022-007. Recommendation: We recommend that the Department review its procedures to ensure that expenditures charged to the program are incurred within the grant’s period of performance. Views of responsible officials: There is no disagreement with the audit finding.

Finding Number: 2022-005 Prior Year Finding Number: N/A Compliance Requirement: Allowable Costs/Cost Principles – Payroll Activities Program: U.S. Department of Treasury COVID-19 - Coronavirus State and Local Fiscal Recovery Funds ALN #: 21.027 Award #: Various Award Year: 03/03/2021 – 12/31/2024 Criteria – The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-federal entities receiving Federal awards (i.e. auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Additionally, salaries and wages charged to Federal awards are subject to the standards of documentation as described by 2 CFR Section 200.430(i) and must be based on records that accurately reflect the work performed. These records must: • Be incorporated into the organization’s official records; • Reasonably reflect the total activity for which the employee is compensated across all grant-related and non-grant related activities (100% effort); and • Support the distribution of employee salary across multiple activities or cost objectives. Condition – We sampled and selected 60 out of 10,079 payroll transactions and noted two instances where employee’s salary for the period recorded in the general ledger did not reconcile with statement of earnings that supports the time and effort for the time charged to the program. As a result, payroll expense charged for the period were overstated. Questioned Costs – Not determinable. Context – This is a condition identified per review of School System’s compliance with the specified requirements using a statistically valid sample. Total amount of payroll expenditures charged to the program in fiscal year 2022 were $11,603,462 and the known amount of the overstated payroll expenses were $14,525. The total amount of the 60 samples selected was $261,550. Effect – The School System is not in compliance with the stated provisions. Failure to properly review and support expenditures can result in noncompliance with laws and regulations along with loss of funding. Cause – Payroll expense were not properly calculated and captured in the accounting system. Recommendation – We recommend that School System improve internal controls to ensure adherence to Federal regulations related to the fiscal and administrative requirements for expending and accounting for payroll expenditures. In additions, OMB should review and reconcile cost to ensure accuracy.   Views of Responsible Officials – The School System concurs with the auditor’s findings and recommendations. As an on-going effort, the process for creating pay elements for specialized compensation will be monitored for accuracy during the creation stages. Electronic alerts generated in the oracle system will be re-employed to notify appropriate finance personnel of changes. The planned corrective actions are presented in the School System’s Corrective Action Plan attached as Appendix B to the Single Audit Report.

Finding Number: 2022-006 Prior Year Finding Number: N/A Compliance Requirement: Procurement and Suspension and Debarment Program: U.S. Department of Treasury COVID-19 - Coronavirus State and Local Fiscal Recovery Funds ALN #: 21.027 Award #: Various Award Period: 03/03/2021- 12/31/2024 Criteria – Recipients of Federal awards must have adequate policies and controls in place to ensure that the procedures are properly documented in the entity’s files, provide full and open competition supported by a cost or price analysis, provide a vendor debarment or suspension certification, provide for retention of files, and that supporting documentation corroborate compliance with these requirements. Condition – We sampled and selected 12 out of 20 procurement transactions during the fiscal year and noted the following: • For 2 samples out of 12 transactions, the first invoice was issued before the contract was signed. In one of these exceptions, the purchase order was also issued before the contract was signed. Details of these two contracts are below: o One contract was dated September 2, 2021, whereas the first invoice processed for the contract was dated June 17, 2021, and the purchase order related to the contract was dated July 20, 2021. o The second contract was dated December 20, 2021, whereas the first invoice processed for the contract was dated December 8, 2021. Questioned Costs – Not determinable. Context – This is a condition identified per review of the School System’s compliance with the provisions of the Procurement compliance requirement using a statistically valid sample. The total amount of procurement transactions for the program during the fiscal year was $26,823,561. The amount of the 12 samples selected was $23,665,988. The known amount of the two transactions was $4,241,558. Effect – The School System is not in compliance with the stated provisions. Cause - The School System does not appear to have a process in place to adequately monitor and maintain completed contract files comprising of all supporting documents. Recommendation - We recommend that the School System improves internal controls to ensure adherence to Federal relations relating to the procurements of goods and services and review current records retention policies to ensure that the required documentation is properly maintained. Views of Responsible Officials – The School System concurs with the auditor’s findings and recommendations. The district is evaluating a centralized contract management solution that would maintain all contracts and agreements upon execution, as well as manage renewals and amendments. The planned corrective actions are presented in the School System’s Corrective Action Plan attached as Appendix B to the Single Audit Report.

Finding Number 2022-007 Prior Year Finding Number N/A Compliance Requirement: Period of Performance Program: U.S. Department of Education Special Education-Grants for Infants and Families ALN #: 84.181A Award #: 210299, 220134 Award Period: 07/01/2020 – 09/30/2021 07/01/2021 - 09/30/2022 Criteria – A non-federal entity may charge to the Federal award allowable costs incurred during the period of performance and any costs incurred before the Federal awarding agency or pass-through entity made the Federal award, only to the extent that they would have been allowable if incurred after the date of the Federal award and only with the written approval of the Federal awarding agency. A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308, 200.309, and 200.403(h)). Condition – We sampled and selected 7 out of 21 expenditures and noted 3 expenditures were not properly reviewed. For compliance with period of performance requirements; the three transactions were incurred before the beginning of the period of performance for the respective grants. Questioned Costs – Not determinable. Context – This is a condition identified per review of the School System compliance with the specified requirements using a statistically valid sample. The known amount of the 3 transactions incurred outside the grant period amounted to $16,302. The total amount of the 7 samples selected was $52,039. The total amount of the 21 expenditures was $229,430. Effect – The School System is not in compliance with the stated provisions. Failure to properly review and support expenditures can result in noncompliance with laws and regulations along with loss of funding. Cause – The School System does not appear to have adequate policies and procedures in place to ensure compliance with the required period of performance stipulations. Recommendation – We recommend that the School System strengthen its processes with respect to setting up and charging expenditures between various grant awards. We also recommend that DOE enhance its review process to properly determine the activities of each grant relative to the appropriate period of performance.   Views of Responsible Officials – The School System concurs with the auditor’s findings and recommendations. The Infants and Toddlers Supervisor will conduct monthly reviews of outstanding purchase orders in Oracle, addressing issues promptly with the Business Operation Officer/Financial Analyst. The planned corrective actions are presented in the School System’s Corrective Action Plan attached as Appendix B to the Single Audit Report.

Finding Number 2022-008 Prior Year Finding Number N/A Compliance Requirement: Allowable Costs/Costs Principles Program: U.S. Department of Education Title I Grants to Local Educational Agencies ALN #: 84.010 Award #: Various Award Period: Various COVID-19 – Governor’s Emergency Education Relief (GEER) ALN #: 84.425C Award #: Various Award Period: Various COVID-19 – Elementary and Secondary School Emergency Relief (ESSR) Fund ALN #: 84.425D Award #: Various Award Period: Various COVID-19 – American Rescue Plan - Elementary and Secondary School Emergency Relief (ARP ESSR) ALN #: 84.425U Award #: 211941 Award Period: 03/24/2021 – 09/30/2023 COVID-19 – American Rescue Plan - Elementary and Secondary School Emergency Relief – Homeless Children and Youth ALN #: 84.425W Award #: Various Award Period: Various Criteria – In accordance with §200.302 Financial Management, a non-federal entity's financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statutes, regulations, and the terms and conditions of the federal award. The financial management system of each non-federal entity must provide for the following: 1. Identification, in its accounts, of all federal awards received and expended and the federal programs under which they were received. 2. Accurate, current, and complete disclosure of the financial results of each federal award or program in accordance with the reporting requirements set forth in §200.327 Financial Reporting and §200.328 Monitoring and Reporting Program Performance. 3. Records that identify adequately the source and application of funds for federally funded activities. 4. Effective control over, and accountability for, all funds, property, and other assets. The Uniform Guidance in 2 CFR Section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, CFR Section 200.510 (b) requires the auditee must also prepare a Schedule of Expenditures of Federal awards (SEFA) for the period covered by the auditee’s financial statements which must include the total Federal awards expended as determined in accordance with 2 CFR section 200.502, Basis for determining Federal awards expended. Condition – The amounts recorded in the Schedule of Expenditures of Federal Awards (SEFA) agree to the total amount recorded in the general ledger. The summary level payroll transactions recorded in the general ledger could not be reconciled to the transaction level detail provided from the payroll system. When comparing the two populations, we identified the following differences: • ALN 84.425 - For ALN 84.425 sub-program D, we noted a variance of $1,828,609. Total payroll expenditures per the payroll system details amounted to $18,437,724 whereas payroll expenditures per SEFA amounted to $16,609,116. In addition to the above, for ALN 84.425 sub-program U, we noted a variance of $301,432. Total payroll expenditures per the payroll system details amounted to $3,607,738 whereas payroll expenditures per the SEFA amounted to $3,909,170. • ALN 84.010 - We noted a variance of $752,503. Total payroll expenditures per the payroll system details amounted to $40,549,584 whereas payroll expenditures per the SEFA amounted to $39,797,081. Questioned Costs – Not Determinable. Context – This is a condition identified per review of the School System’s population completeness over the compliance requirements for each program. The prevalence of these findings is detailed in the condition section above. Effect – The SEFA may not be completely and accurately stated. In addition, the lack of established internal controls policies and procedures to ensure the SEFA is completely and accurately stated can lead to noncompliance with federal statutes, regulations, and provisions of grant agreements. Cause – The School System did not adhere to their internal policies and procedures to ensure the accuracy of the SEFA. Recommendation – We recommend that the School System develop policies and procedures and enhance their existing reconciliation process to ensure the completeness and accuracy of the SEFA, and that amounts reported on the SEFA are supported by transaction level detail. Views of Responsible Officials – The School System does not concur with the auditor’s findings and recommendations. The total expenditures for all federal programs recorded in the Schedule of Expenditures for Federal Awards are accurately presented and tie to the general ledger. The payroll sub-ledger is corrected before posting to the general ledger every two weeks. The resulting differences are most often immaterial but can be traced to corrections made by the Accounting Office after payroll is reviewed by the grants Restricted Funds Supervisor to ensure payroll is not posted to expired grants. The planned corrective actions are presented in the School System’s Corrective Action Plan attached as Appendix B to the Single Audit Report. BDO Response – We have reviewed management’s response and our finding remains as indicated, since we could not validate the details of the differences.

Finding Number: 2022-009 Prior Year Finding Number: N/A Compliance Requirement: Data Collection Form and Single Audit Reporting Package Program: ALN # 21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds ALN # 84.010 Title I Grants to Local Educational Agencies ALN # 84.181A Special Education-Grants for Infants and Families ALN # 84.365A English Language Acquisition State Grants ALN # 84.367 Supporting Effective Instruction State Grants ALN # 84.425 COVID-19 - Education Stabilization Fund Criteria – The Uniform Guidance in 2 CFR Section 200.512, Report Submission, establishes that the audit shall be completed and the data collection form and reporting package shall be submitted to the Federal Audit Clearinghouse (FAC) within the earlier of 30 days after receipt of the auditor’s report or nine (9) months after the end of the audit period, unless a longer period is agreed to in advance by the cognizant or oversight agency for audit. The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition – The School System did not comply with the required submission date of the data collection form and reporting package to the FAC for the fiscal year ended June 30, 2022. Questioned Costs – Not applicable. Context – This is a condition identified per review of the School System’s compliance with the specified requirements. Effect – The School System could be exposed to a reduction or elimination of funds by the Federal awarding agencies. Cause – The School System did not have controls in place to ensure that the reporting package was submitted to the FAC within the required timeframe. Recommendation – We recommend that the School System establishes controls to ensure the reporting package is submitted to the FAC annually within the required timeframe. Views of Responsible Officials - The School System does not concur with the auditor’s findings and recommendations. The fiscal year 2022 single audit was not completed for the auditors to provide a final report to certify in the Federal Audit Clearinghouse within the specified timeframe as noted in the Uniform Guidance in 2 CFR Section 200.512. The planned corrective actions are presented in the School System’s Corrective Action Plan attached as Appendix B to the Single Audit Report. BDO Response – We have reviewed management’s response and our finding remains as indicated, the School System did not have the established controls to ensure the reporting package is submitted to the FAC annually within the required timeframe.

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