Upshur County Board of Education

Equipment and Real Property Management 2025-008 Grant Title: Child Nutrition Cluster: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children, and Fresh Fruit Vegetable Program Federal Award Number and Year: 2025 Assistance Listing #: 10.553, 10.555, 10.559 and 10.582 Federal Agency: US Department of Agriculture Pass-through Entity number: 88 Pass-through Agency: WV Department of Education Grant Title: Title I Grants to Local Educational Agencies (Title I) Federal Award Number and Year: 2025 Assistance Listing #: 84.010A Federal Agency: US Department of Education Pass-through Entity number: 41 Pass-through Agency: WV Department of Education Grant Title: Special Education Cluster: Special Education - Grants to States, Special Education - Preschool Grants Federal Award Number and Year: 2025 Assistance Listing #: 84.027A, 84.173A Federal Agency: US Department of Education Pass-through Entity number: 43 Pass-through Agency: WV Department of Education CONDITION: The Board did not ensure that equipment purchased with funds from the Child Nutrition Cluster, Title I Grants to Local Educational Agencies, and Special Education Cluster were properly tracked through an inventory list. CONTEXT: Specifically, we identified the following: Certain equipment purchased for the Child Nutrition Program was not placed on an equipment inventory listing maintained for each school. Equipment purchases totaling $94,002 could not be traced to an inventory report. Additionally, the equipment listing did not have all information as required by federal guidelines. The Special Education Program was unable to provide an adequate inventory listing for equipment that was purchased with federal funds. Title I Grants to Local Educational Agencies was unable to provide an inventory listing for equipment that was purchased with federal funds. CRITERIA: 7 CFR Section 3015.169 states in part, "Recipient procedures for managing equipment shall, as a minimum, meet the following requirements (including replacement equipment) until such actions as transfer, replacement or disposal takes place: (a) Property records shall be maintained accurately. (Subpart D of this part contains retention and access requirements for these records.) The records shall include for each item of equipment the following: (1) A description of the equipment including manufacturer's serial numbers. (2) An identification number, such as the manufacturer's serial number. (3) Identification of the grant under which the recipient acquired the equipment. (4) The information needed to calculate the Federal share of the equipment (see § 3015.172). (5) Acquisition date and unit acquisition cost. (6) Location, use and condition of the equipment and the date the information was reported. (7) All pertinent information on the ultimate transfer, replacement, or disposal of the equipment. (b) Every two years, at a minimum, a physical inventory shall be conducted and the results reconciled with the property records to verify the existence, current utilization, and continued need for the equipment. Any discrepancies between quantities determined by the physical inspection and those shown in the accounting records shall be investigated to determine the causes of the differences." In addition, the Handbook for School Finance in West Virginia , prepared by the West Virginia Department of Education states, in part, that: "J. INVENTORY CONTROL A data management system should exist that will maintain a perpetual inventory. To maintain such an inventory, the county should have a system that will allow for the additions and subtractions of equipment and supplies. The equipment inventory record for each piece of equipment should include the following information: a. Name of item, make, model and serial number; b. Date of acquisition;c. Purchase order/invoice number;d. Original cost;e. Location;f. Improvements and cost;g. Maintenance dates, if applicable;h. Estimated life, and i. Disposal date." "... Adequate accounting procedures and records for fixed assets are essential to the protective custody of school property. A good system will: (a) fix responsibility for custody and proper use, (b) provide data for management of fixed assets, and (c) provide data for financial control, developing financial reports and adequate insurance coverage." QUESTIONED COSTS: Unknown CAUSE: The Board did not have controls in place that would ensure inventory is properly tracked in accordance with all requirements. EFFECT: The Board did not properly track all equipment on an inventory list. This issue contributed to the disclaimer of opinion. REPEAT FINDING: Yes PRIOR YEAR FINDING NUMBER: 2024-018 RECOMENDATION: The Upshur County Board of Education should establish and follow policies and procedures that will ensure compliance with requirements of the United States Department of Education's equipment management requirements. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS: The Board will establish procedures that will ensure compliance with requirements of the United States Department of Education's equipment management requirements and the WV Department of Education's inventory requirements.

Activities Allowed or Unallowed 2025-009 Grant Title: Title I Grants to Local Educational Agencies (Title I) Federal Award Number and Year: 2025 Assistance Listing #: 84.010A Federal Agency: US Department of Education Pass-through Entity number: 41 Pass-through Agency: WV Department of Education Grant Title: Special Education Cluster: Special Education - Grants to States, Special Education - Preschool Grants Federal Award Number and Year: 2025 Assistance Listing #: 84.027A, 84.173A Federal Agency: US Department of Education Pass-through Entity number: 43 Pass-through Agency: WV Department of Education Grant Title: Child Nutrition Cluster: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children, and Fresh Fruit Vegetable Program Federal Award Number and Year: 2025 Assistance Listing #: 10.553, 10.555, 10.559 and 10.582 Federal Agency: US Department of Agriculture Pass-through Entity number: 88 Pass-through Agency: WV Department of Education CONDITION: Management did not ensure that expenditures were allowable for the Title I, Special Education Cluster, and Child Nutrition Cluster programs. CONTEXT: Specifically, we identified the following: Forty-nine non-payroll expenditure transactions were sampled for Title I Grants to Local Education Agencies, of which Ten expenditures or 20% of the sample size totaling $255,433 in which bid information was not available for review. Three expenditures, or 6% of the sample size, totaling $74,760, to one vendor in which the payment was made in advance of services being rendered. In addition, of the above amount one invoice in the amount of $19,654 was paid for services outside of the contract period. One expenditure, or 2% of the sample size, totaling $10.59, which and employee was paid for single day meal reimbursement without an overnight stay. One expenditure, or 2% of the sample size, totaling $71,474, in which the purchase order was dated after the invoice. In addition, we tested 11 payroll expenditures for the above federal programs and noted the following items: One employee did not have a WV IT-104 withholding form. One employee did not have a WV IT-104 withholding form. Seven employees did not have a valid employment contract in their file. Ten employees did not have a years of experience ledger in the file in order to recalculate pay. One employee did not have a valid teaching certificate. Thirty-nine non-payroll expenditure transactions were sampled for the Child Nutrition Cluster, of which: Four expenditures, or 10% of the sample size, totaling $94,002, in which the equipment purchased could not be traced to an inventory listing maintained for the Child Nutrition program. In addition, we tested 21 payroll expenditures for the above federal program and noted the following items: Twelve employees did not have a WVIT-104 withholding form. Four employees did not have a valid employment contract in their file. Nineteen employees did not have a years of experience ledger in their file in order to recalculate pay. Four employees did not have a W-4 withholding form. One employee did not have support for college hours. One employee had support for 36 college hours but was paid for 72 hours. Three employees did not agree with the certified list. Nine non-payroll expenditure transactions were sampled for the Special Education Cluster, of which: Two expenditures, or 22% of the sample size totaling $412 in which expenditures were not properly coded. In addition, we tested 51 payroll expenditures for the above federal programs and noted the following items: Five employees did not have a valid employment contract in their file. Forty-four employees did not have a years of experience ledger in their file in order to recalculate pay. Eleven employees did not have a W-4 withholding form. Twenty-seven employees did not have a WV IT-104 withholding form.Thirty-seven employees did not have support for voluntary withholdings.Payroll paid from the Child Nutrition Cluster during the fiscal year ended June 30, 2025 totaled $1,294,264. Payroll paid from the Special Education Cluster during the fiscal year ended June 30, 2025 totaled $1,075,570. Payroll paid from the Title I Grants to Local Educational Agencies (Title I) during the fiscal year ended June 30, 2025 totaled $789,643.CRITERIA:Proper internal controls include maintaining an adequate filing system in order to safeguard records and documents and procedures that ensure all purchases are approved by reconciling a purchase order to the invoice from the vendor prior to payment. Additionally, Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) §200.334 states, in part, that: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient." Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) §200.403 states, in part, that: "Except where otherwise authorized by statue, costs must meet the following general criteria in order to be allowable under Federal Awards: ...(c) Be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity. (f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federally-financed program in either the current or a prior period... (g) Be adequately documented." QUESTIONED COSTS: Unknown. CAUSE: Procedures were not in place to ensure that invoices and supporting documentation were maintained for all expenditures and that each expenditure was properly approved. Management of the Board does not have controls in place to comply with the Title 2 U.S. Code of Federal Regulations (CFR) Part 200 and Title 34 U.S. Code of Federal Regulations (CFR) Part 75. EFFECT: Certain funds were not expended in accordance with requirements of their respective programs, and auditors were unable to determine the allowability of expenditures due to inadequate documentation. This issue contributed to the disclaimer of opinion on compliance for the Title I, Special Education Cluster, and Child Nutrition Cluster Programs. REPEAT FINDING: YES PRIOR YEAR FINDING NUMBER: 2024-020 RECOMENDATION: Board officials should establish and follow procedures to require: Contracts for contracted services be available for review, and All personnel files be complete and have adequate support for payroll expenditures. The officials of the Upshur County Board of Education should review the existing procedures and controls over federal award expenditures to determine that these controls are implemented, and working effectively to ensure that expenditures are properly authorized prior to payment. The Board officials should consider additional training, internal reviews, cross-training of employees, and other measures as deemed appropriate to ensure existing controls are implemented. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS: The Board has developed procedures to ensure that all purchase orders are approved before orders are placed, all expenditures are properly authorized by the respective program director and supporting documentation is adequately maintained. The Board is using a requisition form in Droplet to achieve this goal. All employees authorized to make or approve purchases have been trained on purchasing procedures outlined in the Purchasing Policies and Procedures Manual for Local Educational Agencies in the State of West Virginia by the WVDE Office of School Finance on 2/23/2024. The Board is working on making sure personnel files are complete.

Procurement, Suspension and Debarment 2025-010 Grant Title: Child Nutrition Cluster: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children, and Fresh Fruit Vegetable Program Federal Award Number and Year: 2025 Assistance Listing #: 10.553, 10.555, 10.559 and 10.582 Federal Agency: US Department of Agriculture Pass-through Entity number: 88 Pass-through Agency: WV Department of Education CONDITION: Management did not ensure that the prices of food items purchased corresponded with the approved price list for the Child Nutrition Cluster programs. CONTEXT: Thirty-nine non-payroll expenditure transactions were sampled for the Child Nutrition Cluster, of which six expenditures or 30% of the sample size totaling $686,706 were from one food vendor. Approximately 34% of the food items purchases tested from this food vendor were not located on the available bid document detailing foods the Board could purchase with corresponding prices to be charged to the Board or were located on the bid document detailing foods the Board could purchase without a corresponding price. Further, the items that were fruits and were on the available bid document without a corresponding price to be charged to the Board were invoiced at market cost; however, the Board was unable to provide us with documentation to support the market price at the time of the invoice. Food purchases during fiscal year 2025 from this food vendor totaled $1,374,484. CRITERIA: Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) § 200.318 states in part: "a. Documented procurement procedures. The recipient or subrecipient must maintain and use documented procedures for procurement transactions under a Federal award or subaward, including for acquisition of property or services. These documented procurement procedures must be consistent with State, local, and tribal laws and regulations and the standards identified in §§200.317 through 200.327. b. Oversight of contractors. Recipients and subrecipients must maintain oversight to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders. See also §200.501(h)." QUESTIONED COSTS: $467,325 CAUSE: The Board did not have procedures in place to ensure that vendors were complying with specifications of the costs of food agreed to in the contract and that food items were properly invoiced to the Board. EFFECT: The Board does not have proper oversight over the Child Nutrition Cluster program and certain funds were not expended in accordance with requirements of their respective programs. The Board purchased food items not approved through the proper bid process and the auditor was unable to determine if other food items were purchased for the market price due to inadequate documentation. This issue contributed to the disclaimer of opinion on compliance for the Child Nutrition Cluster Programs. REPEAT FINDING: No RECOMMENDATION: The officials of the Upshur County Board of Education should review the existing procedures and controls over federal award expenditures, particularly the oversight of the purchasing process of the Child Nutrition Cluster program, to determine if these can be strengthened. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS: The Child Nutrition Director will reconcile prices on invoices with bid documents to ensure the Board is getting charged the correct amount. They will also work to ensure that only items bid will be purchased and work on a procedure to document the market price of certain items at the time of the invoice.

GENERAL INFORMATION: Grant Title: Child Nutrition Cluster: School Breakfast Program and National School Lunch Program Federal Award Number and Year: 2024 Assistance Listing #: 10.553 and 10.555 Federal Agency: US Department of Agriculture Pass-through Entity number: 88 Pass-through Agency: WV Department of Education CONDITION: The Board did not ensure compliance with the guidelines required for the National School Lunch Program and School Breakfast Program (the Programs) Special Tests and Provisions requirement. CONTEXT: We were unable to confirm that non-program adults are paying for meals prepared for the National School Lunch Program and School Breakfast Program. Outstanding receivables for meals were not being pursued for collection. CRITERIA: Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) Appendix XI Part 4 Section Child Nutrition Cluster Section III. N. 3. states, in part, that: "A [School Food Authority] SFA is required to account for all revenues and expenditures of its non-profit school food service in accordance with State requirements. An SFA must operate its food services on a non-profit basis; all revenue generated by the school food service must be used to operate and improve its food services (7 CFR sections 210.14(a), 210.14(c), 210.19(a)(2), 215.7(d)(1), 220.2, and 220.7(e)(1)(i)." Title 7 U.S. CFR Part 210 National School Lunch Program §210.14(a) states, in part, that: "...School food authorities shall maintain a nonprofit school food service. Revenues received by the nonprofit school food service are to be used only for the operation or improvement of such food service, except that, such revenues shall not be used to purchase land or buildings, unless otherwise approved by FNS, or to construct buildings. Expenditures of nonprofit school food service revenues shall be in accordance with the financial management system established by the State agency under § 210.19(a) of this part." Title 126 - Procedural Rule of the West Virginia Board of Education Series 85 - Policies of Operation Manual Child Nutrition Programs (Policy 4320 §126-85-83) states in part: "83.1. Meals served to teachers, administrators, custodians and other adults, such as school patrons, elderly volunteers and Foster Grandparents Program participants, must be priced so that the adult payments in combination with income from other sources (such as state or local fringe benefits or payroll funds, or funding from voluntary agencies) are sufficient to cover the meal costs. The charge for adult meals is determined by the county board of education and approved by the WVDE in the Agreement between SFA and SA. It is recommended that the charge(s) be established at or near the county per meal costs. Adult meals are not reimbursable nor counted in the commodity allocation entitlement." "83.3. Meals served to adults not directly involved in the child nutrition program such as administrators, teachers, aides, student teachers and other persons working or visiting in the school may not be served free of charge unless the cost of the meal is reimbursed to the program from another funding source. These meals must be reported as non-program adult meals." QUESTIONED COSTS: Unknown CAUSE: The Board does not have a Food Service Collection Policy. Further, the Board is not actively pursuing past due balances for purchases of meals. EFFECT: The Board has potentially used National School Lunch Program funds to subsidize meals for adults who are not eligible to receive free or reduced meals as part of the Program. Furthermore, failure to collect funds on the outstanding receivables inhibits the ability to capitalize such funds for operating and improving its food services. REPEAT FINDING: Yes PRIOR YEAR FINDING NUMBER: 2023-021 RECOMMENDATION: The Upshur County Board of Education should comply with the requirements of the National School Lunch Program as required by the Code of Federal Regulations. In addition, the Board should establish and follow a collection policy and attempt to collect the outstanding balances on the receivables related to the National School Lunch Program.

Grant Title: Child Nutrition Cluster: National School Lunch Program Federal Award Number and Year: 2024 Assistance Listing #: 10.555 Federal Agency: US Department of Agriculture Pass-through Entity number: 88 Pass-through Agency: WV Department of Education Grant Title: Title I Grants to Local Educational Agencies (Title I) Federal Award Number and Year: 2024 Assistance Listing #: 84.010A Federal Agency: US Department of Education Pass-through Entity number: 43 Pass-through Agency: WV Department of Education Grant Title: Special Education Cluster: Special Education - Grants to States, Special Education -Preschool Grants, COVID-19 Special Education Preschool Grants Federal Award Number and Year: 2024 Assistance Listing #: 84.027A, 84.173, 84.173A and 84.173X Federal Agency: US Department of Education Pass-through Entity number: 43 Pass-through Agency: WV Department of Education CONDITION: The Board did not ensure that equipment purchased with funds from the Child Nutrition Cluster, Title I Grants to Local Educaitonal Agencies, and Special Education Cluster were properly tracked through an inventory list. CONTEXT: Specifically, we identified the following: Certain equipment purchased for the Child Nutrition Program was not placed on an equipment inventory listing maintained for each school. Equipment purchases totaling $10,565 could not be traced to an inventory report. The Special Education Program was unable to provide an adequate inventory listing for equipment that was purchased with federal funds. Computers purchased for the Title I Grants to Local Educational Agencies were not kept on an inventory listing or monitored by the Board. CRITERIA: "Recipient procedures for managing equipment shall, as a minimum, meet the following requirements (including replacement equipment) until such actions as transfer, replacement or disposal takes place: (a) Property records shall be maintained accurately. (Subpart D of this part contains retention and access requirements for these records.) The records shall include for each item of equipment the following: (1) A description of the equipment including manufacturer's serial numbers. (2) An identification number, such as the manufacturer's serial number (3) Identification of the grant under which the recipient acquired the equipment. (4) The information needed to calculate the Federal share of the equipment (see § 3015.172). (5) Acquisition date and unit acquisition cost. (6) Location, use and condition of the equipment and the date the information was reported. (7) All pertinent information on the ultimate transfer, replacement, or disposal of the equipment. (b) Every two years, at a minimum, a physical inventory shall be conducted and the results reconciled with the property records to verify the existence, current utilization, and continued need for the equipment. Any discrepancies between quantities determined by the physical inspection and those shown in the accounting records shall be investigated to determine the causes of the differences." In addition, the Handbook for School Finance in West Virginia , prepared by the West Virginia Department of Education states, in part, that: "J. INVENTORY CONTROL A data management system should exist that will maintain a perpetual inventory. To maintain such an inventory, the county should have a system that will allow for the additions and subtractions of equipment and supplies. The equipment inventory record for each piece of equipment should include the following information: a. Name of item, make, model and serial number; b. Date of acquisition; c. Purchase order/invoice number; d. Original cost; e. Location; f. Improvements and cost; g. Maintenance dates, if applicable; h. Estimated life, and i. Disposal date." "... Adequate accounting procedures and records for fixed assets are essential to the protective custody of school property. A good system will: (a) fix responsibility for custody and proper use, (b) provide data for management of fixed assets, and (c) provide data for financial control, developing financial reports and adequate insurance coverage." QUESTIONED COSTS: Unknown CAUSE: Management of the Board does not have controls in place to comply with the United States Department of Education's equipment management requirements or the WV Department of Education's inventory requirements. EFFECT: Board officials and management have not ensured compliance with The Handbook for School Finance in West Virginia, prepared by the West Virginia Department of Education or 7 CFR Section 3015.169. This issues contributed to this disclaimer of opinion on compliance for the Title 1, Special Education Cluster, and Child Nutrition Cluster. REPEAT FINDING: No RECOMMENDATION: The Upshur County Board of Education should establish and follow policies and procedures from The Handbook for School Finance in West Virginia, prepared by the West Virginia Department of Education and ensure compliance with 7 CFR §3015.169.

Grant Title: Special Education Cluster: Special Education - Grants to States, Special Education -Preschool Grants, COVID-19 Special Educatin Preschool Grants Federal Award Number and Year: 2024 Assistance Listing #: 84.027A, 84.173, 84.173A and 84.173X Federal Agency: US Department of Education Pass-through Entity number: 43 Pass-through Agency: WV Department of Education CONDITION: Management did not ensure that all documentation to support the Special Education Cluster was available for audit. CONTEXT: Specifically, we identified the following: The Program Director was unable to provide a grant award or an approved budget for the Special Education Cluster. In addition, the Program Director was unable to provide the maintenance of effort documentation. CRITERIA: Proper internal controls include maintaining an adequate filing system in order to safeguard records and documents. Additionally, Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) §200.334 states, in part, that: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient." QUESTIONED COSTS: Unknown. CAUSE: Procedures were not in place to ensure that a budget was prepared to obtain a grant award and that documentation was maintained for the Special Education Cluster. Management of the Board does not have controls in place to comply with the Title 2 U.S. Code of Federal Regulations (CFR) Part 200. EFFECT: Funds were expended for the Special Education Cluster but the auditors were unable to fully determine the allowability due to not having a budget or grant award. In addition, the auditors were unable to determine that maintenance of effort was maintained due to this information not being available. This issue contributed to the disclaimer of opinion on compliance for the Special Education Cluster. REPEAT FINDING: No RECOMMENDATION: Management of the Upshur County Board of Education should follow the guidance set forth in Title 2 U.S. Code of Federal Regulations (CFR) Part 200.

Grant Title: Title I Grants to Local Educational Agencies (Title I) Federal Award Number and Year: 2024 Assistance Listing #: 84.010A Federal Agency: US Department of Education Pass-through Entity number: 43 Pass-through Agency: WV Department of Education Grant Title: Special Education Cluster: Special Education - Grants to States, Special Education -Preschool Grants, COVID-19 Special Educatin Preschool Grants Federal Award Number and Year: 2024 Assistance Listing #: 84.027A, 84.173, 84.173A and 84.173X Federal Agency: US Department of Education Pass-through Entity number: 43 Pass-through Agency: WV Department of Education Grant Title: Child Nutrition Cluster: School Breakfast Program and National School Lunch Program Federal Award Number and Year: 2024 Assistance Listing #: 10.553 and 10.555 Federal Agency: US Department of Agriculture Pass-through Entity number: 88 Pass-through Agency: WV Department of Education Grant Title: COVID-19 American Rescue Plan Elementary and Secondary School Emergency Relief Fund - Education Stabilization Fund (ESSER) Federal Award Number and Year: 2024 Assistance Listing #: 84.425U, 84.425W Federal Agency: US Department of Education Pass-through Entity number: 52 Pass-through Agency: WV Department of Education CONDITION: Several expenditures were not properly approved by the Federal Program Directors. In addition, signed purchase orders or other supporting documentation were not available for all expenditures. Management did not ensure that expenditures were allowable for the Title I, Special Education Cluster, Child Nutrition Cluster, and ESSER programs. CONTEXT: Specifically, we identified the following: Sixty non-payroll expenditure transactions were sampled for Title I Grants to Local Education Agencies, of which Two expenditures, or 3% of the sample size, totaling $4,518, did not have Program Director approval prior to payment. Seven expenditures, or 12% of the sample size, totaling $162,988, to one vendor in which the contract was not available for review for contracted services. Three expenditures, or 5% of the sample size, totaling $5,040, which were not supported with adequate documentation. Two expenditures, or 3% of the sample size, totaling $4,525, in which the purchase order was dated after the invoice. Ten non-payroll expenditure transactions were sampled for the COVID-19 American Rescue Plan Elementary and Secondary School Emergency Relief (ESSER) Fund - Education Stabilization Fund, of which Five expenditures, or 50% of the sample size, totaling $913,518, did not have Program Director approval prior to payment. Two expenditures, or 20% of the sample size, totaling $28,036, in which the purchase order was dated after the invoice. In addition, we tested 5 employee personnel files with 50 related payroll expenditures for the above federal programs and noted the following items: Three employees did not have a WV IT-104 withholding form. One employee did not have a valid employment contract in their file. Five employees did not have a years of experience ledger in the file in order to recalculate pay. One employee did not have an IRS W-4 withholding form. Sixty non-payroll expenditure transactions were sampled for the Child Nutrition Cluster, of which Two expenditures, or 3% of the sample size, totaling $388,297, did not have Program Director approval prior to payment. Six expenditures, or 10% of the sample size, totaling $57,115, in which the expenditures did not reconcile with the supporting documentation. Forty-one non-payroll expenditure transactions were sampled for the Special Education Cluster, of which Five expenditures, or 12% of the sample size totaling $4,392 in which expenditures were made without a contract or the amounts paid were not provided for in the contract. Six expenditures, or 15% of the sample size, totaling $10,850, in which the purchase order was dated after the invoice. Forty-one expenditures, or 100% could not be traced to a project application. In addition, we tested 7 employee personnel files with 19 related payroll expenditures for the above federal programs and noted the following items: Three employees were paid a total of $219,529 from the Special Education Cluster that should not have been paid with federal funds. Five employees did not have a valid employment contract in their file.Six employees were paid supplements and did not have support in their file. Two employees did not have a valid extra-duty employment contract in their file. Three employees did not have an IRS W-4 withholding form. Four employees did not have a WV IT-104 withholding form. Seven employees did not have a years of experience ledger in the file in order to recalculate pay. CRITERIA: Proper internal controls include maintaining an adequate filing system in order to safeguard records and documents and procedures that ensure all purchases are approved by reconciling a purchase order to the invoice from the vendor prior to payment. Additionally, Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) §200.334 states, in part, that: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient." Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) §200.403 states, in part, that: "Except where otherwise authorized by statue, costs must meet the following general criteria in order to be allowable under Federal Awards: ...(c) Be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity. (f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federally-financed program in either the current or a prior period... (g) Be adequately documented." QUESTIONED COSTS: Unknown. CAUSE: Procedures were not in place to ensure that invoices and supporting documentation were maintained for all expenditures and that each expenditure was properly approved. Management of the Board does not have controls in place to comply with the Title 2 U.S. Code of Federal Regulations (CFR) Part 200 and Title 34 U.S. Code of Federal Regulations (CFR) Part 75. EFFECT: Certain funds were not expended in accordance with requirements of their respective programs, and auditors were unable to determine the allowability of expenditures due to inadequate documentation. This issue contributed to the disclaimer of opinion on compliance for the Title I, Special Education Cluster, Child Nutrition Cluster, and ESSER Programs. REPEAT FINDING: Yes PRIOR YEAR FINDING NUMBER: 2023-022 RECOMMENDATION: Board officials should establish and follow procedures to require: All purchase orders be issued prior to the purchase and receipt of the invoice, Contracts for contracted services be available for review, and All personnel files be complete and have adequate support for payroll expenditures.The officials of the Upshur County Board of Education should review the existing procedures and controls over federal award expenditures to determine that these controls are implemented, and working effectively to ensure that expenditures are properly authorized prior to payment. Board officials should ensure that all expenditures are properly authorized by the respective program directors. The Board officials should consider additional training, internal reviews, cross-training of employees, and other measures as deemed appropriate to ensure existing controls are implemented.

GENERAL INFORMATION: Grant Titles: National School Lunch Program, School Breakfast Program Federal Award Number and Year: 2023 Federal Agency: US Department of Agriculture Assistance Listing # 10.555 and # 10.553 Pass-through Entity number: 88 Pass-through Agency: WV Department of Education CONDITION: The Board did not ensure compliance with the guidelines required for the National School Lunch Program and School Breakfast Program (the Programs) Special Tests and Provisions requirement. CONTEXT: We were unable to confirm that non-program adults are paying for meals prepared for the National School Lunch Program and School Breakfast Program. Outstanding receivables for meals were not being pursued for collection. CRITERIA: Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) Appendix XI Part 4 Section Child Nutrition Cluster Section III. N. 3. states, in part, that: "A [School Food Authority] SFA is required to account for all revenues and expenditures of its non-profit school food service in accordance with State requirements. An SFA must operate its food services on a non-profit basis; all revenue generated by the school food service must be used to operate and improve its food services (7 CFR sections 210.14(a), 210.14(c), 210.19(a)(2), 215.7(d)(1), 220.2, and 220.7(e)(1)(i)." Title 7 U.S. CFR Part 210 National School Lunch Program §210.14(a) states, in part, that: "...School food authorities shall maintain a nonprofit school food service. Revenues received by the nonprofit school food service are to be used only for the operation or improvement of such food service, except that, such revenues shall not be used to purchase land or buildings, unless otherwise approved by FNS, or to construct buildings. Expenditures of nonprofit school food service revenues shall be in accordance with the financial management system established by the State agency under § 210.19(a) of this part." Title 126 - Procedural Rule of the West Virginia Board of Education Series 85 - Policies of Operation Manual Child Nutrition Programs (Policy 4320 §126-85-83) states in part: "83.1. Meals served to teachers, administrators, custodians and other adults, such as school patrons, elderly volunteers and Foster Grandparents Program participants, must be priced so that the adult payments in combination with income from other sources (such as state or local fringe benefits or payroll funds, or funding from voluntary agencies) are sufficient to cover the meal costs. The charge for adult meals is determined by the county board of education and approved by the WVDE in the Agreement between SFA and SA. It is recommended that the charge(s) be established at or near the county per meal costs. Adult meals are not reimbursable nor counted in the commodity allocation entitlement." "83.3. Meals served to adults not directly involved in the child nutrition program such as administrators, teachers, aides, student teachers and other persons working or visiting in the school may not be served free of charge unless the cost of the meal is reimbursed to the program from another funding source. These meals must be reported as non-program adult meals." QUESTIONED COSTS: Unknown CAUSE: The Board does not have a Food Service Collection Policy. Further, the Board is not actively pursuing past due balances for purchases of meals. EFFECT: The Board has potentially used National School Lunch Program funds to subsidize meals for adults who are not eligible to receive free or reduced meals as part of the Program. Furthermore, failure to collect funds on the outstanding receivables inhibits the ability to capitalize such funds for operating and improving its food services. REPEAT FINDING: No RECOMMENDATION: The Upshur County Board of Education should comply with the requirements of the National School Lunch Program as required by the Code of Federal Regulations. In addition, the Board should establish and follow a collection policy and attempt to collect the outstanding balances on the receivables related to the National School Lunch Program. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS: The Board will develop a Food Service Collection Policy and attempt to collect outstanding balances on the receivables related to the National School Lunch Program.

Grant Title: Title I Grants to Local Educational Agencies (Title I) Federal Award Number and Year: 2023 Assistance Listing #: 84.010A Federal Agency: US Department of Education Pass-through Entity number: 41 Pass-through Agency: WV Department of Education Grant Title: Supporting Effective Instruction State Grants (Title II) Federal Award Number and Year: 2023 Assistance Listing #: 84.367 and 84.367A Federal Agency: US Department of Education Pass-through Entity number: 40 Pass-through Agency: WV Department of Education Grant Title: COVID-19 American Rescue Plan Elementary and Secondary School Emergency Relief Fund - Education Stabilization Fund (ESSER) Federal Award Number and Year: 2023 Assistance Listing #: 84.425U Federal Agency: US Department of Education Pass-through Entity number: 52 Pass-through Agency: WV Department of Education CONDITION: Several expenditures were not properly approved by the Federal Program Directors. In addition, signed purchase orders or other supporting documentation were not available for all expenditures. Management did not ensure that expenditures were allowable for the Title I, Title II, and ESSER programs. CONTEXT: Specifically, we identified the following: Sixty non-payroll expenditure transactions were sampled from a population of 204 for Title I Grants to Local Education Agencies, of which Fifty-seven expenditures, or 95% of the sample size, totaling $208,000, did not have Program Director approval prior to payment. Fourteen expenditures, or 23% of the sample size, totaling $144,290, in which the contract was not available for review for contracted services. Twenty-three expenditures, or 38% of the sample size, totaling $30,152, in which purchase orders were not signed. One expenditure, or 2% of the sample size, totaling $2,783, in which an itemized invoice was not available for review. Three expenditures, or 5% of the sample size, totaling $8,003, in which the expenditure was not properly coded. One expenditure, or 2% of the sample size, totaling $6,485, in which the invoice was not itemized. Eleven expenditures, or 18% of the sample size, totaling $25,811, in which the purchase order was dated after the invoice. In addition, one expenditure was $120 more than the approved purchase order. One expenditure, or 2% of the sample size, totaling $23, in which State sales tax was paid. Twenty-three expenditures, or 38% of the sample size, totaling $25,989, which were not supported with adequate documentation. Nine non-payroll expenditures were sampled from a population of 53 for the Supporting Effective Instruction State Grants program (Title II), of which Three expenditures, or 33% of the sample size, totaling $2,827, did not have Program Director approval prior to payment. Four expenditures, or 44% of the sample size, totaling $6,545, in which the purchase order was not signed. Two expenditures, or 22% of the sample size, totaling $3,195, in which the purchase order was dated after the invoice. Sixty non-payroll expenditure transactions were sampled from a population of 93 for the COVID-19 American Rescue Plan Elementary and Secondary School Emergency Relief (ESSER) Fund - Education Stabilization Fund, of which Fifty-four expenditures, or 90% of the sample size, totaling $3,136,290, did not have Program Director approval prior to payment. One expenditure, or 2% of the sample size, totaling $27,665, in which the expenditure was not properly coded. Nineteen expenditures, or 32% of the sample size, totaling $176,763, in which the contract was not available for review for contracted services. Twenty-one expenditures, or 35% of the sample size, totaling $814,912, in which the purchase order was not signed. One expenditure, or 2% of the sample size, totaling $6,485, in which the invoice was not itemized. Twenty-four expenditures, or 40% of the sample size, totaling $940,689, in which the purchase order was dated after the invoice. In addition, one expenditure was $12,000 more than the approved purchase order. Sixteen expenditures, totaling $81,698, that did not have any bid documentation available for review. Ten expenditures, totaling $143,731, were not included in the approved ESSER budget. Six expenditures, totaling $118,731, in which ESSER funds were used to match other federal funds. Three expenditures, totaling $32,460, for activities such as passes or tickets where there was no support to indicate who received the passes or tickets. The final cost of a construction project was $81,589 more than the original bid and also exceeded the next two highest original bids with no documentation available for review regarding change orders or approvals thereof. The Board allowed a construction project to begin knowing that there was a deficit of $107,246 and no known available funding to complete the project. In addition, we tested 20 personnel files and related payroll expenditures for the above federal programs and noted the following items: One employee was overpaid $1,775 for supplemental duties based on support available for review. Six employees did not have a proper verification of education in their file. Five employees did not have a valid employment contract in their file. Four employees were paid supplements, totaling $55,351, and did not have support in their file. Five employees did not have a valid extra-duty employment contract in their file. Four employees did not have an IRS W-4 withholding form. Ten employees did not have a WV IT-104 withholding form. Twenty employees did not have voluntary withholding forms available for review. CRITERIA: Proper internal controls include maintaining an adequate filing system in order to safeguard records and documents and procedures that ensure all purchases are approved by reconciling a purchase order to the invoice from the vendor prior to payment. Additionally, Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) §200.334 states, in part, that: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for Federal awards that are renewed quarterly or annually, from the date of the submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient." Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) §200.403 states, in part, that: "Except where otherwise authorized by statue, costs must meet the following general criteria in order to be allowable under Federal Awards: ...(c) Be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity. (f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federally-financed program in either the current or a prior period... (g) Be adequately documented." Title 34 U.S. Code of Federal Regulations (CFR) Part 75, Subpart E §75.604 states, in part, that: "A grantee shall ensure that sufficient funds are available to meet any non-Federal share of the cost of constructing the facility." QUESTIONED COSTS: Unknown. CAUSE: Procedures were not in place to ensure that invoices and supporting documentation were maintained for all expenditures and that each expenditure was properly approved. Management of the Board does not have controls in place to comply with the Title 2 U.S. Code of Federal Regulations (CFR) Part 200 and Title 34 U.S. Code of Federal Regulations (CFR) Part 75. EFFECT: Certain funds were not expended in accordance with requirements of their respective programs, and auditors were unable to determine the allowability of expenditures due to inadequate documentation. This issue contributed to the disclaimer of opinion on compliance for the Title I, Title II, and ESSER Programs. REPEAT FINDING: No RECOMMENDATION: Board officials should establish and follow procedures to require: All purchase orders be issued prior to the purchase and receipt of the invoice, All expenditures be no greater than the remaining amount on their corresponding blanket purchase orders, Each expenditure be coded in accordance with the Board of Education's chart of accounts, Contracts for contracted services be available for review, and All personnel files be complete and have adequate support for payroll expenditures. The officials of the Upshur County Board of Education should review the existing procedures and controls over federal award expenditures to determine that these controls are implemented, and working effectively to ensure that expenditures are properly authorized prior to payment. Board officials should ensure that all expenditures are properly authorized by the respective program directors. The Board officials should consider additional training, internal reviews, cross-training of employees, and other measures as deemed appropriate to ensure existing controls are implemented. Management of the Upshur County Board of Education should follow the guidance set forth in Title 2 U.S. Code of Federal Regulations (CFR) Part 200 and Title 34 U.S. Code of Federal Regulations (CFR) Part 75. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS: The Board has developed procedures to ensure that all purchased orders are approved before orders are placed, all expenditures are properly authorized by the respective program director and supporting documentation is adequately maintained. The Board is using a requisition form in Droplet to achieve this goal. All employees authorized to make or approve purchases have been trained on purchasing procedures outlined in the Purchasing Policies and Procedures and Procedures Manual for Local Educational Agencies in the State of West Virginia by the WVDE Office of School Finance on 2/23/2024.

Grant Title: COVID-19 American Rescue Plan Elementary and Secondary School Emergency Relief Fund - Education Stabilization Fund (ESSER) Federal Award Number and Year: 2023 Assistance Listing #: 84.425U Federal Agency: US Department of Education Pass-through Entity number: 52 Pass-through Agency: WV Department of Education CONDITION: The Board did not ensure that equipment purchased with funds from the COVID-19 American Rescue Plan Elementary and Secondary School Emergency Relief Fund - Education Stabilization Fund (ESSER) was properly tracked through an inventory list. In addition, the Board was unable to provide evidence of prior written approval for a construction project. CONTEXT: Specifically, we identified the following: Equipment purchased through a lease purchase agreement dated May 15, 2020, totaling $2,147,541, was not placed on an equipment inventory listing maintained for each school. The final lease payment of $536,829 was made during fiscal year 2023. Additional equipment, totaling $38,475, was not placed on an equipment inventory listing maintained for each school. The Board was unable to provide documentation of prior written approval from the West Virginia Department of Education for a HVAC construction project, totaling $1,777,483. CRITERIA: Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) Appendix XI Part 4 Section 84.425-ESF Section 1 - Elementary and Secondary Education states, in part, that: "F. Equipment/Real Property Management Any purchases with ESF funds in this category are subject to applicable inventory control, log maintenance, and disposition requirements consistent with Part 3, Section F, "Equipment /Real Property Management" of the 2023 Compliance Supplement. Auditors should determine whether governors, SEAs, and/or subrecipients received prior approval for capital expenditures for equipment acquisition or improvements to land, buildings, or equipment. (1) For capital equipment or improvements to land, buildings, or equipment that were purchased with grant funds, the governor or SEA must receive prior approval from ED. (2) For capital equipment or improvements to land, buildings, or equipment that were purchased with grant funds, the governor or SEA pass-through agency must provide prior approval to subrecipients." Title 2 U.S. Code of Federal Regulations (CFR) Part 200.439 Equipment and other capital expenditures, states, in part, that: "(b) (1) Capital expenditures for general purpose equipment, buildings, and land are unallowable as direct charges, except with the prior written approval of the Federal awarding agency or pass-through entity. "(b) (2) Capital expenditures for special purpose equipment are allowable as direct costs, provided that items with a unit cost of $5,000 or more have the prior written approval of the Federal awarding agency or pass-through entity. Title 2 U.S. Code of Federal Regulations (CFR) Part 200.313 Equipment states, in part, that: "... (d)(1) Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sales price of the property. (2) A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. (3) A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated." Title 7 CFR Section 3015.169 states, in part, that: "Recipient procedures for managing equipment shall, as a minimum, meet the following requirements (including replacement equipment) until such actions as transfer, replacement or disposal takes place: (a) Property records shall be maintained accurately. (Subpart D of this part contains retention and access requirements for these records.) The records shall include for each item of equipment the following: (1) A description of the equipment including manufacturer's serial numbers. (2) An identification number, such as the manufacturer's serial number. (3) Identification of the grant under which the recipient acquired the equipment. (4) The information needed to calculate the Federal share of the equipment (see § 3015.172). (5) Acquisition date and unit acquisition cost. (6) Location, use and condition of the equipment and the date the information was reported. (7) All pertinent information on the ultimate transfer, replacement, or disposal of the equipment. ... (b) Every two years, at a minimum, a physical inventory shall be conducted and the results reconciled with the property records to verify the existence, current utilization, and continued need for the equipment. Any discrepancies between quantities determined by the physical inspection and those shown in the accounting records shall be investigated to determine the causes of the differences." QUESTIONED COSTS: Unknown CAUSE: The Board did not have controls that would ensure inventory is properly tracked in accordance with all requirements of the ESSER program. Additionally, controls were not in place to track purchases of equipment. Also, the Board did not have controls in place to ensure that proper written approval was obtained in advance of starting a construction project. EFFECT: The Board did not properly track all equipment on an inventory list. Additionally, documentation was not available to verify compliance with requirements for approval of capital expenditures. This issue contributed to the disclaimer of opinion for the ESSER program. REPEAT FINDING: No RECOMMENDATION: The Upshur County Board of Education should establish and follow policies and procedures that will ensure compliance with requirements of the United States Department of Education's equipment management requirements and the requirements applicable to the ESSER program. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS: The Board will establish procedures that will ensure compliance with requirements of the United States Department of Education's equipment management requirements applicable to the ESSER program.

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