CLAY COUNTY BOARD OF EDUCATIONLocal Government

FA 2020-001 Improve Controls over Equipment Compliance Requirement: Equipment and Real Property Management Internal Control Impact: Significant Deficiency Compliance Impact: Nonmaterial Noncompliance Federal Awarding Agency: U.S. Department of Agriculture Pass-Through Entity: Georgia Department of Education CFDA Numbers and Title: 10.553 and 10.555 Child Nutrition Cluster Federal Award Number: 205GA324N1099 Questioned Costs: None Identified Repeat of Prior Year Findings: FA 2019-001, FA 2018-001, FA 2017-001 Description: The policies and procedures of the School District were insufficient to provide adequate internal controls over equipment and real property management as it relates to the Child Nutrition Cluster. Criteria: 2 CFR 200.313(d)(1) states, ?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 sale price of the property.? In addition, 2 CFR 200.313(d)(2) states, ?A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years.? Condition: The following deficiencies were noted when reviewing the Child Nutrition Cluster equipment listing: ? One item on the equipment listing in the prior year was omitted from the current year equipment listing. ? Property records did not consistently include the following required components for each item: (1) A serial number or other identification number, (2) the source of funding for the property (including the FAIN), (3) the acquisition date, (4) cost of the property, (5) percentage of Federal participation in the project costs for the Federal award under which the property was acquired, (6) the location, (7) condition of the property, and (8) any ultimate disposition data including the date of disposal and sale price of the property. Cause: In discussing the deficiency with management, they stated that the Child Nutrition staff were not aware of the requirements for maintaining the Child Nutrition equipment listing until fiscal year 2020 and did not have the capacity to make the appropriate changes prior to fiscal year end. Effect or Potential Effect: Failure to maintain a complete and accurate equipment listing and reconcile results of the physical inventory performed to the property records exposes the School District to unnecessary risk of error and misuse of equipment and/or Federal funds. Additionally, the School District is not in compliance with the Uniform Guidance and Georgia Department of Education guidance. Recommendation: The School District should strengthen controls over Child Nutrition Cluster equipment to ensure that the equipment records are complete and accurate. Management should update the equipment listing to reflect all required information, including a description, an identifying number, the source of funding, the title holder, the acquisition date, the cost, the percentage of federal participation in the project cost, the location, the use and condition, and any ultimate disposal data for each piece of equipment. Management should reconcile the results of the physical inventory of equipment to the Child Nutrition Cluster equipment listing. Views of Responsible Officials: We concur with this finding.

FA 2020-002 Strengthen Controls over Financial Reporting Compliance Requirement: Reporting Internal Control Impact: Material Weakness Compliance Impact: Material Noncompliance Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education CFDA Number and Title: 84.010 Title I Grants to Local Educational Agencies Federal Award Numbers: S010A180010, S010A190010 Questioned Costs: None Identified Repeat of Prior Year Finding: FA 2019-002 Description: The School District did not file accurate completion reports for the Title I Grants to Local Educational Agencies program. Criteria: 2 CFR 200.302(a) states in part that ?the non-Federal entity?s financial management systems must? be sufficient to permit the preparation of reports required by general and program-specific terms and conditions.? In addition, 2 CFR 200.302(b)(2) states in part that the non-Federal entity?s financial management systems must provide for ?accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements.? Furthermore, 2 CFR 200.303(a) states in part that the ?non-Federal must: (a) 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? (c) Evaluate and monitor the non-Federal entity?s compliance with statutes, regulations and terms and conditions of Federal awards.? Condition: A review of the School District?s accounting records and the program completion reports revealed the following: ? The Title I ? Improving Academic Achievement completion report for the period ending June 30, 2020 was under reported by $25,573.28. ? The Title I ? Improving Academic Achievement completion report for the period ending September 30, 2020 was over reported by $9,056.21. Cause: In discussing this deficiency with the School District, they stated the Finance/Payroll Manager used the budget detail reports instead of the general ledger reports from the financial computer system when preparing the completion reports. Effect or Potential Effect: Failure to accurately report Federal award expenditures through the completion report process could lead to the filing of reimbursement requests that do not agree to actual expenditures. Therefore, the School District may obtain more or less Federal funding than they were eligible to receive. Additionally, the School District is not in compliance with the Uniform Guidance and Georgia Department of Education guidance. Recommendation: The School District should revise and implement internal control procedures to ensure that completion reports submitted to the Georgia Department of Education are supported by the accounting records and reimbursement requests are prepared based upon actual expenditures incurred. In addition, management should develop and implement a monitoring process to ensure that control procedures are being followed. Views of Responsible Officials: We concur with this finding.

See Schedule of Findings and Questioned Costs for chart/table Description: The policies and procedures of the School District were insufficient to provide adequate internal controls over equipment and real property management as it relates to the Child Nutrition Cluster. 20 Criteria: 2 CFR 200.313(d)(1) states, ?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 sale price of the property". In addition, 2 CFR 200.313(d)(2) states, "A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years". Condition: The following deficiencies were noted when reviewing the Child Nutrition Cluster equipment listing: ? One item purchased in the current year was not added to the equipment listing appropriately. ? One item purchased in the prior year was not added to the equipment listing appropriately. ? Property records did not consistently include the following required components for each item: (1) A serial number or other identification number, (2) the source of funding for the property (including the FAIN), (3) the acquisition date, (4) cost of the property, (5) percentage of Federal participation in the project costs for the Federal award under which the property was acquired, (6) the location, (7) condition of the property, and (8) any ultimate disposition data including the data of disposal and sale price of the property. ? There was no evidence that a physical inventory has been performed in either the current year or the previous year. Cause: In discussing the deficiency with management, they stated that the Child Nutrition staff were not aware of the requirements for maintaining the Child Nutrition equipment listing. Effect or Potential Effect: Failure to maintain a complete and accurate equipment listing and reconcile results of the physical inventory performed to the property records exposes the School District to unnecessary risk of error and misuse of equipment and/or Federal funds. Additionally, the School District is not in compliance with the Uniform Guidance and Georgia Department of Education guidance. III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS Recommendation: See Schedule of Findings and Questioned Costs for chart/table The School District should strengthen controls over Child Nutrition Cluster equipment to ensure that the equipment records are complete and accurate. Management should update the equipment listing to reflect all required information, including a description, an identifying number, the source of funding, the title holder, the acquisition date, the cost, the percentage of federal participation in the project cost, the location, the use and condition, and any ultimate disposal data for each piece of equipment. Management should perform a physical inventory of equipment at least once every two years and reconcile the results of the physical inventory to the Child Nutrition Cluster equipment listing. Views of Responsible Officials: We concur with this finding.

See Schedule of Findings and Questioned Costs for chart/table Description: The School District did not file accurate completion reports for the Title I Grants to Local Educational Agencies program. Criteria: 2 CFR 200.302(a) states in part that ? the non-Federal entity?s financial management systems must? be sufficient to permit the preparation of reports required by general and program-specific terms and conditions.? In addition, 2 CFR 200.302(b)(2) states in part that the non-Federal entity?s financial management systems must provide for ?accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements.? Furthermore, 2 CFR 200.303(a) states in part that the ?non-Federal must: (a) 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? (c) Evaluate and monitor the non-Federal entity?s compliance with statutes, regulations and terms and conditions of Federal awards.? Condition: A review of the School District?s accounting records and the program completion reports revealed the following: ? The Title I ? Improving Academic Achievement completion report for the period ending June 30, 2019 was over reported by $25,131.80. III FEDERAL AWARD FINDINGS AND QUESTIONED COSTS Cause: In discussing this deficiency with the School District, they stated the Finance/Payroll Manager used the budget detail reports instead of the general ledger reports from the financial computer system when preparing the completion reports. Effect or Potential Effect: Failure to accurately report Federal award expenditures through the completion report process could lead to the filing of reimbursement requests that do not agree to actual expenditures. Therefore, the School District may obtain more or less Federal funding than they were eligible to receive. Additionally, the School District is not in compliance with the Uniform Guidance and Georgia Department of Education guidance. Recommendation: The School District should revise and implement internal control procedures to ensure that completion reports submitted to the Georgia Department of Education are supported by the accounting records and reimbursement requests are prepared based upon actual expenditures incurred. In addition, management should develop and implement a monitoring process to ensure that control procedures are being followed. Views of Responsible Officials: We concur with this finding.

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