Management decision deadline — for entities that funded this organization
The FAC accepted this audit on March 5, 2026. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by September 5, 2026 (17 days from today).
What is a management decision? →2024-001, 2023-001
2024-003, 2023-002
2024-002
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on March 19, 2025. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by September 19, 2025, which was (334 days ago).
What is a management decision? →Finding Number: 2024‐001 Repeat Finding: Yes, 2023‐001 Program Names/Assistance Listing Titles: Assistance Listing Numbers: Federal Award Numbers: Questioned Costs: Indian School Equalization 15.042 A23AV00864 N/A Title I Grants to Local Educational Agencies 84.010 A23AV00864 N/A Federal Agency(ies): U.S. Department of the Interior; U.S. Department of Education Pass‐Through Agency: Bureau of Indian Education Type of Finding: Noncompliance, Material Weakness Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Criteria School management is responsible for establishing and maintaining internal controls over travel reimbursements, credit card transactions, journal entries, and disbursements that are adequate to ensure that all financial activities are properly processed and recorded. Further, Indian tribes and tribal organizations, may without the approval of the BIA, expend funds provided under a selfdetermination contract for purposes identified in 25 USC 5325, to the extent that the expenditure of the funds is supportive of a contracted program (25 USC 5325). These guidelines require internal controls over expenditures of federal monies to ensure expenditures comply with federal regulations and guidelines. (25 CFR 39; 25 CFR 900). Condition The School did not follow its Board adopted policies regarding disbursements to ensure all financial activities were properly processed. Cause The School has not implemented sufficient controls over disbursement transactions. There has been turnover in various key positions. Effect The School was not in compliance with Board adopted policies for federal regulations and guidelines. Context The sample was not intended to be, and was not, a statistically valid sample. During our review of disbursement transactions, we noted the following: • For one of 10 travel reimbursements reviewed, the School did not maintain supporting documents. • For four of 10 travel reimbursements reviewed, the School did not reimburse the expense using the correct rates established by GSA, resulting in a net overpayment of $152. Context • For one of 10 travel reimbursements reviewed, meals were reimbursed with no overnight stay or substantial sleep/rest, and the reimbursement was not reported as a taxable employee benefit. • For seven of 40 disbursements reviewed, no dated receiving report was retained; therefore, we were unable to determine if the School paid goods before they were received. Additionally, we were unable to agree the description and quantity to the purchase order. • For 12 of 40 disbursements reviewed, the School ordered and received goods/services before a purchase order was in place. • For two of 40 disbursements reviewed, the expenditures exceed the authorized purchase order amounts, resulting in total exceeded costs of $151. • For one of 40 disbursements reviewed, the goods were received after the payment was made to vendor. • The School does not have a signed credit card user agreements that acknowledges the receipt of the School credit card use policies and procedures. • For one of 15 credit card transactions reviewed, documentation to verify the receipt of the prepaid item was not maintained. • Credit card statements were not always paid timely, resulting in late fees of $2,086 and finance charges of $2,317. • For one cutoff transaction tested, it was determined that the expenditure should have been assessed as Construction‐in‐Process and tracked with the capital asset listing. The School did not track how much of the project had been completed at year‐end. • For one of 25 journal entries reviewed, the School did not maintain sufficient supporting documentation. • For one of five cutoff transactions reviewed, it was determined that the expenditure should have been paid in the current fiscal year instead of the subsequent fiscal year. • For one of five credit card purchases reviewed, there was no receipt retained. • For 15 of 25 journal entries reviewed, the journal entry was not approved by someone other than the preparer. • For one of 40 disbursements reviewed, the purchase requisition was dated after the purchase and no purchase order was provided. • The School did not properly close out 13 open purchase orders. Recommendation The School should improve and adhere to its Board adopted policies and federal regulations. The School should ensure multiple employees understand the policies and procedures, so they can continue if there is turnover. Views of Responsible Officials
Program Name/Assistance Listing Title: Indian School Equalization Assistance Listing Number: 15.042 Contact Persons: Carmen Jodie, Principal; Patrice Henderson, Business Manager Anticipated Completion Date: June 30, 2025 Planned Corrective Action: The School previously experienced a high turnover rate in the Business Office and Administration. The School had a Principal and Acting Principals throughout School Year 2023‐ 24. The business office has obtained outside consulting services to assist in reconciliation and financial processes. The business office will continue to work with other departments in making sure they submit documentation accurately and timely. The business office will continue to work on improving the following areas: travel reimbursement, receiving reports, timely payment of bills, payment of goods, journal entries, purchase orders; per the findings listed. A Credit Card User Agreement form will be developed to support the school’s Credit Card Policies and Procedures.
2023-001
Finding Number: 2024‐002 Repeat Finding: No Program Names/Assistance Listing Titles: Assistance Listing Numbers: Federal Award Numbers: Questioned Costs: Indian School Equalization 15.042 A23AV00864 N/A Title I Grants to Local Educational Agencies 84.010 A23AV00864 N/A Federal Agency(ies): U.S. Department of the Interior; U.S. Department of Education Pass‐Through Agency: Bureau of Indian Education Type of Finding: Noncompliance, Significant Deficiency Compliance Requirement: Procurement Criteria The Board should have adopted policies in accordance with 2 CFR §200.320 that requires the collection of quotes for purchases of at least $10,000 but no more than $250,000, and formal bid procedures for purchases over $250,000. Condition The School did not follow federal guidelines for purchases exceeding the small purchases threshold. Cause The School has not implemented controls to perform the collection of quotes. There has been turnover in various key positions. Effect The School was not in compliance with the Board adopted policies and federal guidelines. Context The sample was not intended to be, and was not, a statistically valid sample. During our review of procurement requirements, we noted that the School did not prepare and maintain documentation for at least three written quotes from qualified sources, two instances from the Indian School Equalization Program, and three instances from the Title I Grants to Local Educational Agencies program. Recommendation The School should adopt and adhere to federal regulations and implement procedures for performing procurement, and should train multiple employees on the procurement process. Views of Responsible Officials See Corrective Action Plan.
Finding Number: 2024‐002 Program Name/Assistance Listing Title: Indian School Equalization; Title I Grants to Local Educational Agencies Assistance Listing Number: 15.042; 84.010 Contact Persons: Carmen Jodie, Principal; Patrice Henderson, Business Manager Anticipated Completion Date: June 30, 2025 Planned Corrective Action: The School previously experienced a high turnover rate in the Business Office and Administration. The School had a Principal and Acting Principals throughout School Year 2023‐24. The business office has obtained outside consulting services to assist in reconciliation and financial processes. The business office will continue to work with other departments in making sure they submit three written quotes for purchases above $10,000. All Department Supervisors/Administrators will be trained on the procurement process. The school’s policies will be updated to comply with 2 CFR §200.320, along with supporting forms.
Repeat Finding: Yes, 2023‐002, 2022‐003 Program Name/Assistance Listing Title: Indian School Equalization Assistance Listing Number: 15.042 Federal Agency: U.S. Department of the Interior Federal Award Number: A23AV00864 Pass‐Through Agency: Bureau of Indian Education Questioned Costs: N/A Type of Finding: Noncompliance, Significant Deficiency Compliance Requirement: Special Tests and Provisions Criteria According to the Indian Child Protection and Family Violence Protection Act (25 USC §3201 et. Sec.), the School must conduct a character investigation of each individual who is employed or is being considered for employment in a position that involves regular contact with, or control over, Indian children. The investigation should be reinvestigated every five years. The Act further states that the School may employee individuals in those positions only if the individuals meet standards of character, no less stringent than those prescribed under subpart B – Minimum Standards of Character and Suitability for Employment (25 CFR part 63). Condition Timely background investigations were not retained for all employees. Cause School and federal policies were not always followed or controls were not in place to ensure timely character investigations are performed and all adequate documentation is maintained. There has been turnover in various key positions. Effect The School was not in compliance with the Indian Child Protection and Family Violence Prevention Act. Context The sample was not intended to be, and was not, a statistically valid sample. During our review of the School’s character investigations, we noted the following: •For 14 of 40 background investigations reviewed, the reinvestigation was not conducted prior to the expiration of the preceding investigation. •For four of 40 background investigations reviewed, the investigation did not contain all supporting documentation. Recommendation The School should ensure adequate character investigations are performed in a timely manner and documentation is maintained to achieve full compliance with the School’s policies and the Indian Child Protection and Family Violence Prevention Act. Views of Responsible Officials See Corrective Action Plan.
Finding Number: 2024‐003 Program Name/Assistance Listing Title: Indian School equalization; Title I Grants to Local Educational Agencies Assistance Listing Number: 15.042; 84.010 Contact Persons: Carmen Jodie, Principal; Renee Begay, Human Resource Technician Anticipated Completion Date: June 30, 2025 Planned Corrective Action: It is recommended that the School completes all the outstanding background checks. Secondly, the School will ensure that all background checks are fully completed with the appropriate documents for all newly hired and current employees. It is understood that all current and new employees must be reinvestigated every five years and performed in a timely manner (before “the expiration of the preceding investigation”). This is how the school will attempt to attain compliance.
2023-002
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on March 13, 2024. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by September 13, 2024, which was (705 days ago).
What is a management decision? →Account reconciliations were not performed timely and/or did not agree to the general ledger when performed. Current policies and procedures do not provide for segregation of duties as the Business Manager is to post and reconcile transactions without any review process.
THE BUSINESS MANAGER, PATRICE HENDERSON WILL SEEK OUTSIDE CONSULTING AND SERVICES TO ASSIST IN RECONCILIATIONS AND FINANCIAL PROCESSES. ANTICIPATED COMPLETION DATE IS JUNE 2024
2022-001
During our test work over special tests and provisions, we noted the oversight agency (Bureau of Indian Education) conducted an investigation and found the background checks were not performed properly.
THE HUMAN RESOURCES MANAGER, RENEE BEGAY WILL COMPLY WITH THE INDIAN CHILD PROTECTION AND FAMILY VIOLENCE PROTECTION ACT AND ENSURE THAT INVESTIGATIONS ARE PROPERLY DOCUMENTED. ANTICIPATED COMPLETION DATE IS JUNE 2024.
2022-002
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on March 21, 2023. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by September 21, 2023, which was (1063 days ago).
What is a management decision? →LUKACHUKAI COMMUNITY SCHOOL, INC. SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE YEAR ENDED JUNE 30, 2022 SECTION II ? FINANCIAL STATEMENT FINDINGS 2022-001 Account Reconciliations - Repeated (Prior Year Finding 2021-001 and 2020-001) Condition: Account reconciliations were not performed timely and/or did not agree to the general ledger when performed. Current policies and procedures do not provide for segregation of duties as the Business Manager is to post and reconcile transactions without any review process. Criteria: The School is responsible for maintaining adequate internal controls over its accounting records, account balances, and financial statement disclosures. Accounting records should include a complete, balanced general ledger that records all transactions that is supported by appropriate subsidiary records so that accurate financial statements can be prepared. Procedures should be in place to ensure that balance sheet accounts are independently reviewed and reconciled to the subsidiary records in a timely and effective manner. Cause: There was a lack of established internal controls and processes over the financial reporting and reconciliation process to ensure timely and accurate financial reporting. Effect: Without established and adequate internal controls and reconciliation procedures, the School?s balances lack certainty about the accuracy of the balances. Also, the probability that fraud or material errors will occur and go undetected generally increases. Repeat: Yes ? Years as Repeat Finding: Two Auditor's Recommendation: We recommend management evaluate all aspects of the financial close and reporting process as well as the account reconciliation process and establish adequate internal controls and procedures to ensure timely and accurate financial statements and supporting schedules and to ensure timely compliance requirements are met. View Of Responsible Officials: The School agrees with this finding and has a plan in place to correct this.
Findings Related to the Financial Statements Reported in Accordance with Government Auditing Standards Finding Number: 2022-001 -Account Reconciliations Responsible Persons: Business Manager, Patrice Henderson Anticipated Completion Date: June 2023 Planned Corrective Action: There was an Acting Principal and Acting Business Manager for part of the year. Since July of 2021, LCS hire a new Principal and in December of 2020, LCS hired a Consultant who are both familiar with the financial requirements of grant schools and have improved and are continuing to improve internal controls by updating policies and procedures. The Consultant was recently hired as the Business Manager and will continue to work on creating a more detailed coding system to allow for better tracking and to ensure this information is accurate and reconciled timely.
2021-001
SECTION III ? AUDIT FINDINGS IN RELATION TO FEDERAL AWARDS 2022-002 Special Tests and Provisions Test Work ? Repeated (Prior Year Finding 2021-003) Funding agency: U.S. Department of the Interior 07/01/2021 06 /? 30/2022 A19AV00941 Titles: Indian School Equalization program Assistance Listing Number: (ISEP) 15.042 Award Year: 07/01/2021 06 /? 30/2022 Award number: A19AV00941 CONDITION: During our test work over special tests and provisions, we noted the oversight agency (Bureau of Indian Education) conducted an investigation and found the background checks were not performed properly. Criteria: The Indian Child Protection and Family Violence Prevention Act (25 USC 3201 et seq.) requires Indian tribes and tribal organizations that receive funds under the ISDEAA or the Tribally Controlled Schools Act to conduct an investigation of the character of each individual who is employed or is being considered for employment by such Indian tribe or tribal organization in a position that involves regular contact with, or control over, Indian children. The Act further states that the Indian tribe or tribal organization may employ individuals in those positions only if the individual meet standards of character, no less stringent than those prescribed under subpart B ? Minimum Standards of Character and Suitability for Employment (25 CFR part 63), as the Indian tribe or tribal organization establishes. Questioned Costs: Unknown Cause: The School policies were not followed or were not in place. Effect: The School is not in compliance with the special tests and provisions requirement. Repeat: Yes ? Years as Repeat Finding: One Auditor's Recommendation: We recommend that the School ensure that employees follow the policies and procedures that are in place along with the compliance requirements for the Indian School Equalization Program and ensure that that the compliance requirement is being followed. Views of Responsible Officials: The School agrees with this finding and has a plan in place to correct this.
Findings Related to Federal Awards Finding Number: 2022-002 - Special Tests and Provisions, Background Checks Responsible Persons: Interim Principal, Charlotte Begay Anticipated Completion Date: June 2023 Planned Corrective Action: The school hired an Interim Principal, Charlotte Begay, who has the experience to ensure character investigations are completed that comply with the Indian Child Protection and Family Violence Protection Act and the investigations are appropriately documented before completing the hiring process. The school will also comply with the Act which states the School may employ individuals in those positions only if the individuals meet standards of character, no less stringent that those prescribed under subpart B - Minimum Standards of Character and Suitability for Employment (25 CFR part 63).
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on June 27, 2022. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by December 27, 2022, which was (1331 days ago).
What is a management decision? →The School has not required Board approval for employee stipend payments. This created a weak control environment surrounding the authorization and issuance of stipend payments. Additionally, the School?s administration violated governing stipends. We received a independent report from the Principal that detailed the excessive stipends that were paid out during the fiscal year and in the previous fiscal years.Criteria:The School is responsible for the efficient and effective administration of Federal awards through application of sound management practices. (2 CFR 200.400) Stipends will be paid to employeeswith the advance written approval by the employee?s Supervisor/Admin and approved by the Principal and School Board. Stipends are to be used only in the event an employee is performing additional job duties outside regular duty hours which are not covered by his/her regular job dutiesas outlined in the position description. (Lukachukai Personnel Policy 400.18)Questioned Costs:UnknownCause:The School policies were not followed or were not in place. The School?s management is solely responsible for determining when stipends are warranted and the amount at which they should be paid. Vacant positions at the School have caused a need for existing employees to perform additional dutiesnot covered by his/her regular job duties thus an increase in the amount of stipends issued.Effect:The School could be susceptible to unreasonable costs which may result in disallowed costs related to federal awards.Repeat: Yes ? Years as Repeat Finding: TwoAuditor's Recommendation:The School should adhere to the Board adopted Personnel Policy Manual and federal regulations andbe vigilant regarding its employee staffing practices and usage of employee stipend payments.Views of Responsible Officials:The School agrees with this finding and has a plan in place to correct this.
Findings Related to Federal AwardsFinding Number: 2021-002Responsible Persons: School Principal, Sherry Mitchell; Consultant/Business Manager, Patrice HendersonAnticipated Completion Date: September 2022Planned Corrective Action: There was an Acting Principal and Acting Business Manager for part of the year. Since July of 2021, LCS hired a new Principal and in December of 2021, LCS hired a Consultant familiar with grant school requirements. The Principal and Consultant have developed a Stipend Policy that will ensure all authorized signers are included, in the addition to ensuring that the School Board approval is included. All Policies and Procedures will be consistently updated and revised with consideration of updates and through collaboration with school staff and school board members; at this time, all has been approved by the school board and are on file. The current Principal has not approved any stipends for the current year to be put before the school board.
2020-002
During our test work over special tests and provisions, we noted that for one employee the background check and character investigation could not be produced. The Indian Child Protection and Family Violence Prevention Act (25 USC 3201 et seq.) requires Indian tribes and tribal organizations that receive funds under the ISDEAA or the Tribally Controlled Schools Act to conduct an investigation of the character of each individual who is employed or is being considered for employment by such Indian tribe or tribal organization in a position that involves regular contact with, or control over, Indian children. The Act further states that the Indian tribe or tribal organization may employ individuals in those positions only if the individual meet standards of character, no less stringent than those prescribed under subpart B ? Minimum Standards of Character and Suitability for Employment (25 CFR part 63), as the Indian tribe or tribal organization establishes.Questioned Costs:UnknownCause:The School policies were not followed or were not in place.Effect:The School is not in compliance with the special tests and provisions requirement.Auditor's Recommendation:We recommend that the School ensure that employees follow the policies and procedures that are in place along with the compliance requirements for the Indian School Equalization Program and ensure that that the compliance requirement is being followed.Views of Responsible Officials:The School agrees with this finding and has a plan in place to correct this.
Findings Related to Federal AwardsFinding Number: 2021-003Responsible Persons: School Principal, Sherry Mitchell; Consultant/Business Manager, Patrice HendersonAnticipated Completion Date: September 2022Planned Corrective Action: The School?s Principal who was hired in July of 2021, has assumed the duties of the Human Resources and has the experience and training to ensure character investigations are completed that comply with the Indian Child Protection and Family Violence Protection Act and the investigations are appropriately documented before completing the hiring process. The school will also comply with the Act which states the School may employ individuals in those positions only if the individuals meet standards of character, no less stringent than those prescribed under subpart B ? Minimum Standards of Character and Suitability for Employment (25 CFR part 63).
The School did not submit their required Federal Financial Reports (SF-425) for two quarters December 31, 2020 and June 30, 2021 of the program year within the required 30 days after the end of each reporting period. The reports were submitted on April 15, 2021 and August 11, 2021 respectively.Criteria:Federal regulations and grant and contract conditions require that financial reports filed by supported by accurate supporting documentation, such as a general ledger reports, and the Tribe submit Federal Financial Reports (SF-425) on a quarterly or annual basis.Questioned Costs:UnknownCause:The school did not have adequate monitoring over the completion and submission of required reports, in addition to turnover. The School is not in compliance with the reporting requirements per the grant contract.Effect:Noncompliance with these requirements could potentially result in a reduction or discontinuation of program awards in future periods, and incorrect information may be included in amounts reported for federal programs.Auditor's Recommendation:We recommend that the School establish and implement policies and procedures for the creation, approval, submission, and retention of all required reports on a timely basis.Views of Responsible Officials:The School agrees with this finding and has a plan in place to correct this.
Findings Related to Federal AwardsFinding Number: 2021-004Responsible Persons: School Principal, Sherry Mitchell; Consultant/Business Manager, Patrice HendersonAnticipated Completion Date: July 2022Planned Corrective Action: The School had an Acting Business Manager for part of the year. The School has hired a Consultant who has experience with grant schools and is familiar with the preparation and filing of the SF-425s. LCS has hire the Consultant to be the Business Manager for the next fiscal year.
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on April 14, 2021. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by October 14, 2021, which was (1770 days ago).
What is a management decision? →2019-001
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on March 29, 2020. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by September 29, 2020, which was (2150 days ago).
What is a management decision? →Data source: This information comes from the Federal Audit Clearinghouse, the official repository of Single Audit data. All data is public domain. Verify this organization's audit history at fac.gov.
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