YUKON-KOYUKUK SCHOOL DISTRICT

Finding 2022-001 Significant Deficiency in Internal Control Over Compliance ? Procurement, Suspension, and Debarment Identification of the federal program Award Year Agency and Pass-through 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) 84.027/84.173 SE 22.YKSD.01 Criteria or Specific Requirement In accordance with 2 CFR 200, the District must follow its own procurement policy which conforms to Uniform Guidance Standards. This requires the District to, among other things, ensure that it maintains procurement requisitions and supporting documents reviewed and approved by the appropriate authority, depending on the amount. Condition Procedures and controls were developed by the school district based on the Uniform Guidance to obtain quotes for any purchases above $10,000. During our audit we noted one instance in which documentation was not retained for the procurement requirements. Cause Internal controls policies were not in place to ensure the District follows its own procurement requirements for the program. Effect or Potential Effect Lack of proper internal controls over the process for obtaining and retaining appropriate documentation that quotes were received could lead to the District spending more grant funding on goods and services than necessary. Questioned Costs None. Context In our test work for procurement requirements, we noted the District did not follow the procurement policy and did not retain documentation of procurement for 1 out of 2 samples selected for test work. Identification as a repeat finding This is a repeat finding of finding 2021-001. See the attached Status of Prior Year Findings. Recommendation We recommend the District implement internal control procedures to ensure the appropriate process is being followed in relation to obtaining an adequate number of quotes. Views of responsible official The district staff have been trained in district and uniformed guidelines procurement policies in response to the prior year finding 2021-001. Further training on required documentation and necessary recordkeeping will be provided to all staff responsible for making purchases.

Corrective Action Plan Year Ended June 30, 2022 District Contact: Heather Heineken, SFO, CSRM Chief Financial Officer 4762 Old Airport Way, Fairbanks, AK 99709 (907) 374-9409 Finding 2022-001 Significant Deficiency in Internal Controls Over Compliance ? Procurement, Suspension, and Debarment Corrective Action: The district staff have been trained in district and uniformed guidelines procurement policies in response to the prior year finding 2021-001. The purchases in question were made prior to the training that occurred in the prior year. Further training on required documentation and necessary recordkeeping will be provided to all staff responsible for making purchases. Anticipated Completion Date: 01/31/2023

2021-001

Finding 2021-001 Material Weakness in Internal Controls Over Compliance ? Procurement, Suspension, and Debarment Award Year Agency and Passthrough Entity Federal Program Title Federal Assistance Listing Number Grant Number 2021 U.S. Department of Education - passed through the State of Alaska Department of Education and Early Development Innovative Approaches to Literacy, Full Service, Community Schools; and Promise Neighborhoods 84.215 S215G180091-20 Criteria or specific requirement In accordance with 2 CFR 200, the District must follow its own procurement policy which confirms to Uniform Guidance standards. This requires the District to, among other things, ensure that it maintains procurement requisitions and supporting documents reviewed and approved by the appropriate authority, depending on the amount. Condition Procedures and controls were developed by the school district to obtain quotes for any purchases above $3,000. During our audit we noted three instances quotes were not obtained for purchases greater than $3,000 charged to the program. Cause Internal controls policies were not in place to ensure the District follows its own procurement requirements for the program. Effect or potential effect The District was not in compliance with the procurement requirement for the program required by Uniform Guidance. Therefore, the district may be spending more grant funding on goods and services than necessary. Questioned Costs $24,700. Context In our test work for procurement requirements, we noted the District did not follow the procurement policy and did not obtain quotes from other sources for 2 out of 3 samples selected for test work. Recommendation We recommend the district revise their policies to align with those of the Federal Government. Additionally, we recommend that district staff be adequately trained to follow the current policies and procedures in place. Views of responsible officials and planned corrective actions Management concurs, the District will update its policy in accordance with Uniform Guidance and approval process will be established to ensure procurement requirements are followed. Please see the corrective action plan.

District Contact: Heather Heineken, SFO, CSRM Chief Financial Officer 4762 Old Airport Way, Fairbanks, AK 99709 (907) 374-9409 Finding 2021-001 Material Weakness in Internal Controls Over Compliance ? Procurement, Suspension, and Debarment Corrective Action: Yukon-Koyukuk School District will present updated procurement policies in accordance with Uniform Guidance 2 CFR 200.320 to the School Board for approval. All staff who have purchasing ability will be notified of procurement policies. Any future purchases meeting the micro-purchase threshold or greater will submit required supporting documents prior to approval. Anticipated Completion Date: 12/31/2021