GALENA CITY SCHOOL DISTRICTState Government

Finding 2024-003 Reporting – Material Noncompliance and Material Weakness in Internal Control Over Compliance Identification of the Federal Program ALN 84.041- Impact Aid – U.S. Department of Education - Direct Program 2024 Criteria or Specific Requirement The Uniform Guidance in 2 CFR Section 200.303, Internal Controls requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal statues, regulations, and the terms and conditions of the federal award. Application for Impact Aid – Section 7003 (OMB No. 1810-0687) – Each year an LEA must submit this application, which provides the following information: counts of federally connected children in various categories, membership and average daily attendance data, and information on expenditures for children with disabilities. Condition The District failed to retain source check documentation to support the student count and information certification by federal representatives. Cause Internal control process for retention of the source documentation was not followed. Effect or potential effect We were unable to confirm the completeness and verification that the students that were reported for the program were federally connected children. Questioned Costs Questioned costs are not determinable based on the information available. Context For the testwork for reporting over impact aid we requested source check documentation for the students that were reported federally connected children and the District was not able to provide any evidence. Identification as a repeat finding Not a repeat finding. Recommendation We recommend that the District comply with the requirements of CFR section 200.313 and establish documentation retention policy and maintain records in accordance with the uniform guidance. Views of responsible officials Management agrees with this finding. Steps will be taken to correct the retention of source check documentation process and enhance internal controls to prevent similar occurrences in the future.

Finding 2024-004 Reporting – Noncompliance and Significant Deficiency in Internal Control Over Compliance Identification of the Federal Program ALN 10.553 and 10.555 – School Breakfast Program and National School Lunch Program Child Nutrition Cluster – U.S. Department of Agriculture passed through the State of Alaska Department of Education and Early Development, pass through entity identification numbers 01701 and FD 24.GCSD.01. Year 2024 Criteria or Specific Requirement The Uniform Guidance in 2 CFR Section 200.303, Internal Controls requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal statues, regulations, and the terms and conditions of the federal award. Claims for Reimbursement-SFAs and sponsors must submit monthly claims for reimbursement for meals and snacks served to eligible students within 60 days following the last day of the month covered by the claim (7 CFR sections 210.8, 220.11, 215.10, and 225.15(c)). Condition One report was submitted after the due dates as indicated in the grant and compliance guidelines. Cause The Districts internal controls over reporting are not designed to appropriately ensure timely reporting. Effect or potential effect The District was not in compliance with the grant requirements. Questioned Costs None. Context We selected 4 monthly reimbursement reports for testwork and noted one report was submitted past the due date. Identification as a repeat finding Not a repeat finding. Recommendation We recommend that management review report due dates and ensure that accurate reports are submitted before they are due. Views of responsible officials Management agrees with this finding. Steps will be taken to correct the reporting process and enhance internal controls to prevent similar occurrences in the future.

Finding 2022-001 Procurement, Suspension & Debarment - Significant Deficiency in Internal Control Over Compliance and Noncompliance Award Year Agency and Passthrough Entity Federal Program Title Federal Assistance Listing Number Grant Number 2022 Department of Education ? passed through the State of Alaska, Department of Education and Early Development Special Education Cluster (IDEA) ? Preschool Grants 84.173 SE 22.GCSD.01 2022 Department of Education ? passed through the State of Alaska, Department of Education and Early Development Special Education Cluster (IDEA) ? Grants to State 84.027 SE 22.GCSD.01 Criteria or Specific Requirement: Internal control policies should be established to provide reasonable assurance that an entity with which the District plans to enter into a covered transaction is not debarred, suspended, or otherwise excluded for covered transactions under Uniform Guidance. Condition: The District did not verify whether vendors were debarred, suspended, or otherwise excluded. Cause: Implemented procedures at the District over procurement failed to ensure that District personnel retained documentation whether vendors were debarred, suspended, or otherwise excluded. Effect or potential effect: By not verifying the status of vendors, the District might unknowingly conduct business with a vendor that is debarred, suspended, or otherwise excluded. Questioned Costs: N/A Context: Auditors were not able to review documentation from the District that showed evidence of the search for five vendors. Auditors did not identify any debarred, suspended, or otherwise excluded vendors with which the District did business with during FY2022. Identification as a repeat finding: No Recommendation: We recommend that management retain evidence of review that prospective vendors and suppliers are not on the suspension and debarment list before entering into covered transactions under Uniform Guidance. Views of responsible officials: Management agrees with this finding. The district will refer to https://sam.gov/content/exclusions to check to see if vendors being used by the District are either excluded or disbarred entities. This will be done at the beginning for the fiscal year for those vendors that are known to provide services in forth coming year. Should a new vendor be used during the year, prior to entering into a contract, that vendor will be checked against the abovementioned website.

2020-003 Significant Deficiency in Internal Controls Over Compliance ? Procurement and Suspension and Debarment Identification of the federal program Agency and Pass-through Entity Federal Program Title Federal CFDA Number Department of Education ? passed through the State of Alaska, Department of Education and Early Development Special Education Cluster (IDEA) 84.027/84.173 Criteria or specific requirement Uniform Guidance has an established procurement requirements, which is required to be followed when procurement thresholds are met. Condition Uniform Guidance compliance and control attributes were not met due to inadequate documentation related to procurement. Cause Lack of sufficient controls to address procurement compliance requirements. Effect or Potential Effect Noncompliance with procurement requirements. Questioned Costs None Context During testwork, a signed and approved contract or vendor agreement was not able to be provided. Supporting documentation for the procurement transaction was not retained. Identification as a repeat finding This is not a repeat finding. Recommendation We recommend that the steps be taken by the District in the future to ensure that the procurement compliance requirements are followed.

2020-004 Significant Deficiency in Internal Controls Over Compliance ? Allowable Costs and Activities Identification of the federal program Agency and Pass-through Entity Federal Program Title Federal CFDA Number Department of Education ? passed through the State of Alaska, Department of Education and Early Development Special Education Cluster (IDEA) 84.027/84.173 Criteria or specific requirement Internal controls and procedures should be established to ensure expenditures are coded to the correct grants. Condition Insufficient controls were established in this area. Cause The District did not have controls in place to ensure expenditures were properly handled. Effect or Potential Effect Internal controls related to allowable costs and activities were not followed. Questioned Costs None Context During testwork, it was noted that an expenditure from a different fund was coded to the Federal Major Program. The expenditure was not corrected until expenditure was identified during the audit. Identification as a repeat finding This is not a repeat finding. Recommendation We recommend that the steps be taken by the District in the future to ensure that expenditures are coded to the correct funds. Views of responsible officials Management concurs with the finding. See corrective action plan for further information.