EIN: 936000550
UEI: KHE4DJAG9661
Audited by: Sorren CPAs, PC
Oversight agency: 84 [Department of Education]
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Data as of August 28, 2026
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on January 7, 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 July 7, 2026 (53 days ago).
What is a management decision? →2025-001: Significant Deficiency - Reporting U.S. Department of Education Pass-through Oregon Department of Education Child Nutrition Cluster – AL #s 10.553, 10.555, 10.559 and 10.582 Criteria – Management is responsible for ensuring reporting meets the Reporting Principles as required by 2 CFR §200.302, §200.328 and program regulations, where information reported is complete, accurate and timely. Monthly claim reports submitted through the state reporting system must accurately reflect reimbursable meals served Condition – The District submitted monthly child nutrition reimbursement claims that contained inaccurate meal counts for multiple months during the fiscal year. Specifically, the District overstated reimbursable meal counts due to errors in including nonreimbursable meals served. Additionally, the claims were not subject to an independent review prior to submission to ensure accuracy and completeness. Cause – The District did not have a formalized review and reconciliation process for monthly child nutrition claims and responsibilities for claim preparation and review were not adequately segregated. Effect or potential effect – As a result, the District received federal reimbursements in excess of allowable meals served. Based on audit procedures performed, the resulting questioned costs were less than $25,000, which is below the Uniform Guidance reporting threshold and therefore not required to be reported. Recommendations – We recommend the District enhance internal controls by implementing an independent review to the reporting process to ensure meal counts are properly calculated prior to submission. Views of Responsible Officials and Planned Corrective Actions – Management agrees with this finding. Management will revisit internal controls and independent review processes to ensure meal counts reported are in accordance with requirements as defined in 2 CFR §200.302, §200.328 and program regulations.
Show full finding ▾Hide full finding ▴2025-001: Significant Deficiency - Reporting U.S. Department of Education Pass-through Oregon Department of Education Child Nutrition Cluster – AL #s 10.553, 10.555, 10.559 and 10.582 Criteria – Management is responsible for ensuring reporting meets the Reporting Principles as required by 2 CFR §200.302, §200.328 and program regulations, where information reported is complete, accurate and timely. Monthly claim reports submitted through the state reporting system must accurately reflect reimbursable meals served Condition – The District submitted monthly child nutrition reimbursement claims that contained inaccurate meal counts for multiple months during the fiscal year. Specifically, the District overstated reimbursable meal counts due to errors in including nonreimbursable meals served. Additionally, the claims were not subject to an independent review prior to submission to ensure accuracy and completeness. Cause – The District did not have a formalized review and reconciliation process for monthly child nutrition claims and responsibilities for claim preparation and review were not adequately segregated. Effect or potential effect – As a result, the District received federal reimbursements in excess of allowable meals served. Based on audit procedures performed, the resulting questioned costs were less than $25,000, which is below the Uniform Guidance reporting threshold and therefore not required to be reported. Recommendations – We recommend the District enhance internal controls by implementing an independent review to the reporting process to ensure meal counts are properly calculated prior to submission. Views of Responsible Officials and Planned Corrective Actions – Management agrees with this finding. Management will revisit internal controls and independent review processes to ensure meal counts reported are in accordance with requirements as defined in 2 CFR §200.302, §200.328 and program regulations.
2025-001 Reporting US Department of Education – AL #s10.553, 10.555, 10.559 and 10.582 Child Nutrition Cluster Condition: The District submitted monthly child nutrition reimbursement claims that contained inaccurate meal counts for multiple months during the fiscal year. Specifically, the District overstated reimbursable meal counts due to errors in including non-reimbursable meals served. Additionally, the claims were not subject to an independent review prior to submission to ensure accuracy and completeness. Name of Contact Person: Ann Berman, Business Manager Plan of Action: The District will revisit the internal control processes surrounding the grant reporting and reimbursement process to ensure meal count information submitted is within program requirements of Child Nutrition Cluster programs. In the event there are questions surrounding meal count and other information subject to reporting, the District will continue to rely on timely guidance from external governmental accounting consultants, the Oregon Department of Revenue, and the Oregon Department of Education.
FAC accepted this audit on January 7, 2025 — management decision was due July 7, 2025.
FAC accepted this audit on March 26, 2024 — management decision was due September 26, 2024.
2023-004: Material Weakness - Verification of Free and Reduced Price Applications U.S. Department of Agriculture Pass-through – Oregon Department of Education Child Nutrition Cluster – AL # 10.555 Criteria – Verification of Free and Reduced Price Applications (NSLP). By November 15th of each school year, the District must verify the current free and reduced price eligibility of households selected from a sample of applications that it has approved for free and reduced price meals, unless the District is otherwise exempt from the verification requirement. The verification sample size is based on the total number of approved applications on file on October 1st. The District must perform the verification function in accordance with instructions provided by the state agency. The District must follow up on children whose eligibility status has changed as the result of verification activities to put them in the correct category. Condition – The District did not select or verify a sample of applications that it approved for free and reduced price meals during the District's fiscal year ending June 30, 2023. Cause – The District did not have adequate internal controls, policies and procedures with regard to its responsibility to conduct verification of free and reduced price applications for the NSLP child nutrition program. Effect or Potential Effect – For the fiscal year ending June 30, 2023, the District may have incorrect eligibility status with regard to households receiving free or reduced price meals. Questioned Costs – $0 Recommendations – We recommend the District enhance internal controls to ensure that verification of applications for free and reduced price meals are performed by the November 15th due date. Views of Responsible Officials and Planned Corrective Actions – Management agrees with this finding. Management will enhance internal controls to ensure requirements of verification of free and reduced priced applications are met.
Show full finding ▾Hide full finding ▴2023-004: Material Weakness - Verification of Free and Reduced Price Applications U.S. Department of Agriculture Pass-through – Oregon Department of Education Child Nutrition Cluster – AL # 10.555 Criteria – Verification of Free and Reduced Price Applications (NSLP). By November 15th of each school year, the District must verify the current free and reduced price eligibility of households selected from a sample of applications that it has approved for free and reduced price meals, unless the District is otherwise exempt from the verification requirement. The verification sample size is based on the total number of approved applications on file on October 1st. The District must perform the verification function in accordance with instructions provided by the state agency. The District must follow up on children whose eligibility status has changed as the result of verification activities to put them in the correct category. Condition – The District did not select or verify a sample of applications that it approved for free and reduced price meals during the District's fiscal year ending June 30, 2023. Cause – The District did not have adequate internal controls, policies and procedures with regard to its responsibility to conduct verification of free and reduced price applications for the NSLP child nutrition program. Effect or Potential Effect – For the fiscal year ending June 30, 2023, the District may have incorrect eligibility status with regard to households receiving free or reduced price meals. Questioned Costs – $0 Recommendations – We recommend the District enhance internal controls to ensure that verification of applications for free and reduced price meals are performed by the November 15th due date. Views of Responsible Officials and Planned Corrective Actions – Management agrees with this finding. Management will enhance internal controls to ensure requirements of verification of free and reduced priced applications are met.
a. Material Weakness-Verification of Free and Reduced Price Applications The District did not select or verify a sample of applications that it approved for free and reduced price meals during 2022-2023. b. LCSD7 Plan of Action - New staff hired in July of 2023 has received training from Oregon Department of Education on the verification of application process. In January the District received a waiver and now can offer every student free meals. c. The Business Manager along with the Elementary Principal will ensure this process is complete in June 2024.
2023-005: Material Weakness - Paid Lunch Equity (NSLP) U.S. Department of Agriculture Pass-through – Oregon Department of Education Child Nutrition Cluster – AL # 10.555 Criteria – The District is required to ensure that sufficient funds are provided to its nonprofit school food service accounts from lunches served to students not eligible for free or reduced price meals. An entity that charges less for a paid lunch that the difference between the federal reimbursement rate for such a lunch and that for a free lunch is required to comply. The difference in price is known as "equity". There are two ways to meet the requirement: by raising prices charged for paid lunches or through contributions from other non-federal sources. The District is required to perform calculations to determine whether its paid lunch price requires adjustment. Condition – The District did not calculate its average paid lunch pricing requirement for the fiscal year ended June 30, 2023. Cause – The District did not have adequate internal controls, policies and procedures with regard to its responsibility to ensure sufficient funds are provided to its nonprofit food service accounts. Effect or Potential Effect – The District may not have adjusted its paid lunch price according to the calculations required by paid lunch equity calculation. Questioned Costs – $0 Recommendations – We recommend the District enhance internal controls to ensure calculation of the average paid lunch is performed timely. Views of Responsible Officials and Planned Corrective Actions – Management agrees with this finding. Management will enhance internal controls to ensure requirements of paid lunch equity are met.
Show full finding ▾Hide full finding ▴2023-005: Material Weakness - Paid Lunch Equity (NSLP) U.S. Department of Agriculture Pass-through – Oregon Department of Education Child Nutrition Cluster – AL # 10.555 Criteria – The District is required to ensure that sufficient funds are provided to its nonprofit school food service accounts from lunches served to students not eligible for free or reduced price meals. An entity that charges less for a paid lunch that the difference between the federal reimbursement rate for such a lunch and that for a free lunch is required to comply. The difference in price is known as "equity". There are two ways to meet the requirement: by raising prices charged for paid lunches or through contributions from other non-federal sources. The District is required to perform calculations to determine whether its paid lunch price requires adjustment. Condition – The District did not calculate its average paid lunch pricing requirement for the fiscal year ended June 30, 2023. Cause – The District did not have adequate internal controls, policies and procedures with regard to its responsibility to ensure sufficient funds are provided to its nonprofit food service accounts. Effect or Potential Effect – The District may not have adjusted its paid lunch price according to the calculations required by paid lunch equity calculation. Questioned Costs – $0 Recommendations – We recommend the District enhance internal controls to ensure calculation of the average paid lunch is performed timely. Views of Responsible Officials and Planned Corrective Actions – Management agrees with this finding. Management will enhance internal controls to ensure requirements of paid lunch equity are met.
a. Material Weakness - Paid Lunch Equity (NSLP) The District did not calculate its average paid lunch pricing requirement for the fiscal year ended June 30, 2023. b. LCSD7 Plan of Action - New staff hired in July of 2023 has received training from Oregon Department of Education on the calculation process for paid lunch pricing. c. The Business Manager along with the Elementary Principal will ensure this process is complete in June 2024.
FAC accepted this audit on March 27, 2023 — management decision was due September 27, 2023.
FAC accepted this audit on January 15, 2023 — management decision was due July 15, 2023.
District prepared grant progress and financial reporting according to an internal reconciliation spread-sheet tool outside of the General Ledger rather than reports using the accounting system. Consequently, no GL re-ports that would support externally generated grant progress and financial reporting could be provided.Cause: General ledger accounts specific to certain grants were not established within the chart of accounts.Effect or Potential Effect: The lack of effective internal control activities over financial reporting could allow for reporting errors, calculation errors, and payments for unauthorized purposes. Improper financial recording could result in reporting and claiming the same costs for more than one grant or other reimbursement program.Questioned Cost: NoContext: During the testing of expenditures, it was found that no specific general ledger accounts or account codes were prepared for the federal ESSER grants. A spreadsheet gathering expenditures, prepared retrospectively, was utilized for gathering the costs to report to the state grant administrator. Reimbursement requests for ESSER in fiscal year 2020-2021 included $130,093 of expenditures from fiscal year 2019-2020 based upon the retrospec-tive expenditure spreadsheet.Repeat of a Prior-Year Finding: NoRecommendation: The District should develop a policy to record grant program expenditures within separate gen-eral ledger accounts or codes in order to ensure that all grant expenditures are recorded properly and only reported to the appropriate programs.Section II?Financial Statements Findings (Cont.)District's Response: An excel spreadsheet was used from the General Ledger where all expenditures were originated with the proper authorization with approval processes in place. The excel spreadsheet was used for convenience of all in one location. But did originate from the Ivision Accounting Software.Corrective Action Plan: The District uses a separate code to track federal ESSER Funds. The District is provid-ing attached to the findings and questioned cost all general ledger detail for further review. In future the District will not only provide the General Ledger Detail rather than exporting it out into an excel spreadsheet. The District has restated the SEFA for FY 2019-20 as well as FY 2020-21, to accommodate for the errors in the original SEFA that was issued for both years.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
Show full finding ▾Hide full finding ▴Finding 2021-001 - Source Documentation, Strengthen Controls over Financial Reporting (Material Weak-ness)Criteria: Management is responsible for establishing and maintaining effective internal control over financial re-porting. Internal controls should allow management or employees in the normal course of performing their as-signed functions to prevent or detect material misstatements in the financial reporting of all district funds.Condition: District prepared grant progress and financial reporting according to an internal reconciliation spread-sheet tool outside of the General Ledger rather than reports using the accounting system. Consequently, no GL re-ports that would support externally generated grant progress and financial reporting could be provided.Cause: General ledger accounts specific to certain grants were not established within the chart of accounts.Effect or Potential Effect: The lack of effective internal control activities over financial reporting could allow for reporting errors, calculation errors, and payments for unauthorized purposes. Improper financial recording could result in reporting and claiming the same costs for more than one grant or other reimbursement program.Questioned Cost: NoContext: During the testing of expenditures, it was found that no specific general ledger accounts or account codes were prepared for the federal ESSER grants. A spreadsheet gathering expenditures, prepared retrospectively, was utilized for gathering the costs to report to the state grant administrator. Reimbursement requests for ESSER in fiscal year 2020-2021 included $130,093 of expenditures from fiscal year 2019-2020 based upon the retrospec-tive expenditure spreadsheet.Repeat of a Prior-Year Finding: NoRecommendation: The District should develop a policy to record grant program expenditures within separate gen-eral ledger accounts or codes in order to ensure that all grant expenditures are recorded properly and only reported to the appropriate programs.Section II?Financial Statements Findings (Cont.)District's Response: An excel spreadsheet was used from the General Ledger where all expenditures were originated with the proper authorization with approval processes in place. The excel spreadsheet was used for convenience of all in one location. But did originate from the Ivision Accounting Software.Corrective Action Plan: The District uses a separate code to track federal ESSER Funds. The District is provid-ing attached to the findings and questioned cost all general ledger detail for further review. In future the District will not only provide the General Ledger Detail rather than exporting it out into an excel spreadsheet. The District has restated the SEFA for FY 2019-20 as well as FY 2020-21, to accommodate for the errors in the original SEFA that was issued for both years.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
Finding 2021-001 - Source Documentation, Strengthen Controls over Financial Reporting (Material Weak-ness)Criteria: Management is responsible for establishing and maintaining effective internal control over financial re-porting. Internal controls should allow management or employees in the normal course of performing their as-signed functions to prevent or detect material misstatements in the financial reporting of all district funds.Condition: District prepared grant progress and financial reporting according to an internal reconciliation spread-sheet tool outside of the General Ledger rather than reports using the accounting system. Consequently, no GL re-ports that would support externally generated grant progress and financial reporting could be provided.Cause: General ledger accounts specific to certain grants were not established within the chart of accounts.Effect or Potential Effect: The lack of effective internal control activities over financial reporting could allow for reporting errors, calculation errors, and payments for unauthorized purposes. Improper financial recording could result in reporting and claiming the same costs for more than one grant or other reimbursement program.Questioned Cost: NoContext: During the testing of expenditures, it was found that no specific general ledger accounts or account codes were prepared for the federal ESSER grants. A spreadsheet gathering expenditures, prepared retrospectively, was utilized for gathering the costs to report to the state grant administrator. Reimbursement requests for ESSER in fiscal year 2020-2021 included $130,093 of expenditures from fiscal year 2019-2020 based upon the retrospec-tive expenditure spreadsheet.Repeat of a Prior-Year Finding: NoRecommendation: The District should develop a policy to record grant program expenditures within separate gen-eral ledger accounts or codes in order to ensure that all grant expenditures are recorded properly and only reported to the appropriate programs.Section II?Financial Statements Findings (Cont.)District's Response: An excel spreadsheet was used from the General Ledger where all expenditures were originated with the proper authorization with approval processes in place. The excel spreadsheet was used for convenience of all in one location. But did originate from the Ivision Accounting Software.Corrective Action Plan: The District uses a separate code to track federal ESSER Funds. The District is provid-ing attached to the findings and questioned cost all general ledger detail for further review. In future the District will not only provide the General Ledger Detail rather than exporting it out into an excel spreadsheet. The District has restated the SEFA for FY 2019-20 as well as FY 2020-21, to accommodate for the errors in the original SEFA that was issued for both years.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
During the Single Audit for Lake County School District No. 7 for year ended June 30, 2021, we be-came aware of the ineffective processes and/or procedures relating to internal controls over financial reporting. The SEFA presented for audit included significant unreconciled differences between the SEFA and the General Ledger, rendering the SEFA incomplete.Cause: Lake County School District No. 7 does not have effective internal control over the preparation of the Schedule of Expenditures of Federal Awards. The district did not reconcile the expenditures reported on the Schedule of Expenditures of Federal Awards with the amounts reported on the district?s general ledger.Effect or Potential Effect: Without proper internal control over financial reporting, erroneous financial statements and corresponding schedules could be compiled, resulting in a misrepresentation of the financial standing of Lake County School District No. 7. Failure to properly ensure the Catalog of Federal domestic Assistance (CFDA) num-bers and amounts are correct on the Federal Grant Activity Schedule could result in reporting errors on the district?s Single Audit Report to the Federal Audit Clearinghouse.Questioned Cost: NoContext: The SEFA presented for audit did not reconcile to the general ledger for Federal Awards. Lack of ade-quate controls over the Schedule of Expenditures of Federal Awards resulted in the following:? Expenditures for the ESSER grants were kept on worksheets outside of the general ledger and resulted in ESSER expenditures not being reported on the SEFA.? No Rural and Low-Income Schools expenditures were included in the Schedule of Expenditures of Federal Awards although the receipt of the federal revenue was properly recorded as such in the general ledger. The result was an under-statement of the expenditures of Federal Awards on the SEFA.Section II?Financial Statements Findings (Cont.)? Also coded into federal grants on the GL was at least one State of Oregon sourced grant. The lack of inter-nal controls surrounding proper recognition of federal revenues and expenditures caused reconciliation of recorded expenditures of federal award to the SEFA to be plagued with errors.? Federal revenues from Lake County ESD were not included on the SEFA, but were recorded as federal in the GL.? Commodities received from the US Department of Agriculture were not recorded in the GL in accounts identified as federal commodities received, and the amount reported on the SEFA do not agree with the re-ported amounts from Oregon Department of Education (ODE).? Accruals for various federal grants were not appropriately reported on the SEFA.? No reconciliation between federal expenditures reported on the GL and the SEFA was presented to the au-ditors or otherwise noted.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that the district establish policies and procedures to ensure that all Federal awards and related expenditures are identified and reported accurately on the SEFA. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The district should provide appropriate training to staff who are assigned to prepare and review the SEFA.District's Response: 2019-20 SEFA was reported incorrectly and a REVISED 2019-20 was submitted to ODE per their request. I did not originally do the SEFA for 2019-20, I believe that the auditors from Umpqua did it on their own. I rolled forward from 2019-20, causing my 2020-21 to come through incorrectly. I had missed RLIS and ESSER grants on the SEFA.Corrective Action Plan: The District will keep a ledger of all Federal Funds receipts and expenditures. Creating a separate fund for each federal award. This correction will allow the District to be more exact and reconciliations will be of will be much clearer to the public as well as an audit team.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
Show full finding ▾Hide full finding ▴Finding 2021-002 ? Schedule of Expenditures of Federal Awards, Strengthen Controls Over the Federal Grant Activity Schedule (Material Weakness)Criteria: The Internal Control ? Integrated Framework, published by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and the U.S. Government Accountability Office Standards for Internal Con-trol in the Federal Government specify that a satisfactory control environment is only effective when there are ad-equate control activities in place. Effective control activities dictate that a review is performed to verify the accu-racy and completeness of financial information reported. The Federal Grant Activity Schedule captures amounts that must be accurate and complete in order to ensure the accuracy of the financial and federal information report-ed on such schedule to verify the accuracy and completeness of financial information reported.Condition: During the Single Audit for Lake County School District No. 7 for year ended June 30, 2021, we be-came aware of the ineffective processes and/or procedures relating to internal controls over financial reporting. The SEFA presented for audit included significant unreconciled differences between the SEFA and the General Ledger, rendering the SEFA incomplete.Cause: Lake County School District No. 7 does not have effective internal control over the preparation of the Schedule of Expenditures of Federal Awards. The district did not reconcile the expenditures reported on the Schedule of Expenditures of Federal Awards with the amounts reported on the district?s general ledger.Effect or Potential Effect: Without proper internal control over financial reporting, erroneous financial statements and corresponding schedules could be compiled, resulting in a misrepresentation of the financial standing of Lake County School District No. 7. Failure to properly ensure the Catalog of Federal domestic Assistance (CFDA) num-bers and amounts are correct on the Federal Grant Activity Schedule could result in reporting errors on the district?s Single Audit Report to the Federal Audit Clearinghouse.Questioned Cost: NoContext: The SEFA presented for audit did not reconcile to the general ledger for Federal Awards. Lack of ade-quate controls over the Schedule of Expenditures of Federal Awards resulted in the following:? Expenditures for the ESSER grants were kept on worksheets outside of the general ledger and resulted in ESSER expenditures not being reported on the SEFA.? No Rural and Low-Income Schools expenditures were included in the Schedule of Expenditures of Federal Awards although the receipt of the federal revenue was properly recorded as such in the general ledger. The result was an under-statement of the expenditures of Federal Awards on the SEFA.Section II?Financial Statements Findings (Cont.)? Also coded into federal grants on the GL was at least one State of Oregon sourced grant. The lack of inter-nal controls surrounding proper recognition of federal revenues and expenditures caused reconciliation of recorded expenditures of federal award to the SEFA to be plagued with errors.? Federal revenues from Lake County ESD were not included on the SEFA, but were recorded as federal in the GL.? Commodities received from the US Department of Agriculture were not recorded in the GL in accounts identified as federal commodities received, and the amount reported on the SEFA do not agree with the re-ported amounts from Oregon Department of Education (ODE).? Accruals for various federal grants were not appropriately reported on the SEFA.? No reconciliation between federal expenditures reported on the GL and the SEFA was presented to the au-ditors or otherwise noted.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that the district establish policies and procedures to ensure that all Federal awards and related expenditures are identified and reported accurately on the SEFA. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The district should provide appropriate training to staff who are assigned to prepare and review the SEFA.District's Response: 2019-20 SEFA was reported incorrectly and a REVISED 2019-20 was submitted to ODE per their request. I did not originally do the SEFA for 2019-20, I believe that the auditors from Umpqua did it on their own. I rolled forward from 2019-20, causing my 2020-21 to come through incorrectly. I had missed RLIS and ESSER grants on the SEFA.Corrective Action Plan: The District will keep a ledger of all Federal Funds receipts and expenditures. Creating a separate fund for each federal award. This correction will allow the District to be more exact and reconciliations will be of will be much clearer to the public as well as an audit team.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
Finding 2021-002 ? Schedule of Expenditures of Federal Awards, Strengthen Controls Over the Federal Grant Activity Schedule (Material Weakness)Criteria: The Internal Control ? Integrated Framework, published by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and the U.S. Government Accountability Office Standards for Internal Con-trol in the Federal Government specify that a satisfactory control environment is only effective when there are ad-equate control activities in place. Effective control activities dictate that a review is performed to verify the accu-racy and completeness of financial information reported. The Federal Grant Activity Schedule captures amounts that must be accurate and complete in order to ensure the accuracy of the financial and federal information report-ed on such schedule to verify the accuracy and completeness of financial information reported.Condition: During the Single Audit for Lake County School District No. 7 for year ended June 30, 2021, we be-came aware of the ineffective processes and/or procedures relating to internal controls over financial reporting. The SEFA presented for audit included significant unreconciled differences between the SEFA and the General Ledger, rendering the SEFA incomplete.Cause: Lake County School District No. 7 does not have effective internal control over the preparation of the Schedule of Expenditures of Federal Awards. The district did not reconcile the expenditures reported on the Schedule of Expenditures of Federal Awards with the amounts reported on the district?s general ledger.Effect or Potential Effect: Without proper internal control over financial reporting, erroneous financial statements and corresponding schedules could be compiled, resulting in a misrepresentation of the financial standing of Lake County School District No. 7. Failure to properly ensure the Catalog of Federal domestic Assistance (CFDA) num-bers and amounts are correct on the Federal Grant Activity Schedule could result in reporting errors on the district?s Single Audit Report to the Federal Audit Clearinghouse.Questioned Cost: NoContext: The SEFA presented for audit did not reconcile to the general ledger for Federal Awards. Lack of ade-quate controls over the Schedule of Expenditures of Federal Awards resulted in the following:? Expenditures for the ESSER grants were kept on worksheets outside of the general ledger and resulted in ESSER expenditures not being reported on the SEFA.? No Rural and Low-Income Schools expenditures were included in the Schedule of Expenditures of Federal Awards although the receipt of the federal revenue was properly recorded as such in the general ledger. The result was an under-statement of the expenditures of Federal Awards on the SEFA.Section II?Financial Statements Findings (Cont.)? Also coded into federal grants on the GL was at least one State of Oregon sourced grant. The lack of inter-nal controls surrounding proper recognition of federal revenues and expenditures caused reconciliation of recorded expenditures of federal award to the SEFA to be plagued with errors.? Federal revenues from Lake County ESD were not included on the SEFA, but were recorded as federal in the GL.? Commodities received from the US Department of Agriculture were not recorded in the GL in accounts identified as federal commodities received, and the amount reported on the SEFA do not agree with the re-ported amounts from Oregon Department of Education (ODE).? Accruals for various federal grants were not appropriately reported on the SEFA.? No reconciliation between federal expenditures reported on the GL and the SEFA was presented to the au-ditors or otherwise noted.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that the district establish policies and procedures to ensure that all Federal awards and related expenditures are identified and reported accurately on the SEFA. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The district should provide appropriate training to staff who are assigned to prepare and review the SEFA.District's Response: 2019-20 SEFA was reported incorrectly and a REVISED 2019-20 was submitted to ODE per their request. I did not originally do the SEFA for 2019-20, I believe that the auditors from Umpqua did it on their own. I rolled forward from 2019-20, causing my 2020-21 to come through incorrectly. I had missed RLIS and ESSER grants on the SEFA.Corrective Action Plan: The District will keep a ledger of all Federal Funds receipts and expenditures. Creating a separate fund for each federal award. This correction will allow the District to be more exact and reconciliations will be of will be much clearer to the public as well as an audit team.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
During our audit, we found errors in expenditure-driven grants where receivables and reve-nue/unavailable revenue were misstated. A grant reimbursement request for expenditures was made but was not recorded in the general ledger revenue or receivables at the appropriate year end. This financial reporting omission caused receivables and revenue/unavailable revenue to be misstated.Cause: The District does not have appropriate procedures in place to ensure that receivables and reve-nue/unavailable revenue are properly recorded in the general ledger. Grant expenditures were not kept in separate and identifiable federal ledger accounts, but were gathered on an Excel worksheet retrospectively after month end closings. Grant receivables and revenue/unavailable revenue were not tracked and reconciled to the general ledger.Section II?Financial Statements Findings (Cont.)Effect or Potential Effect: Without proper internal control structures over financial reporting, erroneous financial statements and corresponding schedules could be compiled, resulting in a misrepresentation of the financial stand-ing of Lake County School District No. 7.Context: A grant reimbursement request of $130,093 was made well into the 2020-21 fiscal year for expenditures not identified as federal expenditures in the financial information for the fiscal year 2019-2020. This resulted in expenditures of federal awards that were not reported on a SEFA, for 2019-20 or 2020-21.At FY 2020-2021 year end, the District had unrecorded revenues from ESSER 2 grants of $136,652. The expendi-tures were reported on the SEFA, however, revenue for that amount should have been reported as such for the fis-cal year 2020-2021.Various other accruals were not made in the general ledger, for revenue recognition of grants based on matching principal of expenditures and revenues for reimbursement grants.Of grants that were reported on the GL, various misuse of GL account codes established by ODE, caused some State grants to be reported as federal grants, and some federal grants to be reported as State grants.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that the district establish policies and procedures to ensure that grant activity is recorded in the general ledger timely and accurately. Internal controls should also be designed to prevent, detect, or correct errors and omissions in a timely manner.District's Response: Grant agreement for ESSER funds was not signed and fully executed until August 2020 and the other was November 2020. Yes we went back to prior year to capture from the time frame allowable by the grant agreement of March 13, 2020, the auditors most likely should have restated 2019-20 financial statements with the un-precedented times of federal dollars been given in short time frames. Discussed in #1 & 2 that there was mistakes made on 2020-21 SEFA because of the roll forward and the fact that they should brought to my attention that I was miss-ing/incorrect or inadvertently added an incorrect grant.Corrective Action Plan: The District will do adjusting entries into a separate fund in order to capture all poten-tial expenditures related to the grant that has been backdated by Oregon Department of Education or any other entity that has awarded the District with funds. The District will also alert the engaged audit firm of any changes that will affect a prior year of any grants that could potentially be retrospect back. To ensure there should be a re-statement of a prior year audit.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
Show full finding ▾Hide full finding ▴Finding 2021-003 ? Accounting for Grants, Strengthen Controls Over Financial Reporting (Material Weak-ness)Criteria: Management is responsible for establishing and maintaining effective internal control over financial re-porting. Internal controls should allow management or employees in the normal course of performing their as-signed functions to prevent or detect material misstatements in the financial reporting of all district funds.Condition: During our audit, we found errors in expenditure-driven grants where receivables and reve-nue/unavailable revenue were misstated. A grant reimbursement request for expenditures was made but was not recorded in the general ledger revenue or receivables at the appropriate year end. This financial reporting omission caused receivables and revenue/unavailable revenue to be misstated.Cause: The District does not have appropriate procedures in place to ensure that receivables and reve-nue/unavailable revenue are properly recorded in the general ledger. Grant expenditures were not kept in separate and identifiable federal ledger accounts, but were gathered on an Excel worksheet retrospectively after month end closings. Grant receivables and revenue/unavailable revenue were not tracked and reconciled to the general ledger.Section II?Financial Statements Findings (Cont.)Effect or Potential Effect: Without proper internal control structures over financial reporting, erroneous financial statements and corresponding schedules could be compiled, resulting in a misrepresentation of the financial stand-ing of Lake County School District No. 7.Context: A grant reimbursement request of $130,093 was made well into the 2020-21 fiscal year for expenditures not identified as federal expenditures in the financial information for the fiscal year 2019-2020. This resulted in expenditures of federal awards that were not reported on a SEFA, for 2019-20 or 2020-21.At FY 2020-2021 year end, the District had unrecorded revenues from ESSER 2 grants of $136,652. The expendi-tures were reported on the SEFA, however, revenue for that amount should have been reported as such for the fis-cal year 2020-2021.Various other accruals were not made in the general ledger, for revenue recognition of grants based on matching principal of expenditures and revenues for reimbursement grants.Of grants that were reported on the GL, various misuse of GL account codes established by ODE, caused some State grants to be reported as federal grants, and some federal grants to be reported as State grants.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that the district establish policies and procedures to ensure that grant activity is recorded in the general ledger timely and accurately. Internal controls should also be designed to prevent, detect, or correct errors and omissions in a timely manner.District's Response: Grant agreement for ESSER funds was not signed and fully executed until August 2020 and the other was November 2020. Yes we went back to prior year to capture from the time frame allowable by the grant agreement of March 13, 2020, the auditors most likely should have restated 2019-20 financial statements with the un-precedented times of federal dollars been given in short time frames. Discussed in #1 & 2 that there was mistakes made on 2020-21 SEFA because of the roll forward and the fact that they should brought to my attention that I was miss-ing/incorrect or inadvertently added an incorrect grant.Corrective Action Plan: The District will do adjusting entries into a separate fund in order to capture all poten-tial expenditures related to the grant that has been backdated by Oregon Department of Education or any other entity that has awarded the District with funds. The District will also alert the engaged audit firm of any changes that will affect a prior year of any grants that could potentially be retrospect back. To ensure there should be a re-statement of a prior year audit.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
Finding 2021-003 ? Accounting for Grants, Strengthen Controls Over Financial Reporting (Material Weak-ness)Criteria: Management is responsible for establishing and maintaining effective internal control over financial re-porting. Internal controls should allow management or employees in the normal course of performing their as-signed functions to prevent or detect material misstatements in the financial reporting of all district funds.Condition: During our audit, we found errors in expenditure-driven grants where receivables and reve-nue/unavailable revenue were misstated. A grant reimbursement request for expenditures was made but was not recorded in the general ledger revenue or receivables at the appropriate year end. This financial reporting omission caused receivables and revenue/unavailable revenue to be misstated.Cause: The District does not have appropriate procedures in place to ensure that receivables and reve-nue/unavailable revenue are properly recorded in the general ledger. Grant expenditures were not kept in separate and identifiable federal ledger accounts, but were gathered on an Excel worksheet retrospectively after month end closings. Grant receivables and revenue/unavailable revenue were not tracked and reconciled to the general ledger.Section II?Financial Statements Findings (Cont.)Effect or Potential Effect: Without proper internal control structures over financial reporting, erroneous financial statements and corresponding schedules could be compiled, resulting in a misrepresentation of the financial stand-ing of Lake County School District No. 7.Context: A grant reimbursement request of $130,093 was made well into the 2020-21 fiscal year for expenditures not identified as federal expenditures in the financial information for the fiscal year 2019-2020. This resulted in expenditures of federal awards that were not reported on a SEFA, for 2019-20 or 2020-21.At FY 2020-2021 year end, the District had unrecorded revenues from ESSER 2 grants of $136,652. The expendi-tures were reported on the SEFA, however, revenue for that amount should have been reported as such for the fis-cal year 2020-2021.Various other accruals were not made in the general ledger, for revenue recognition of grants based on matching principal of expenditures and revenues for reimbursement grants.Of grants that were reported on the GL, various misuse of GL account codes established by ODE, caused some State grants to be reported as federal grants, and some federal grants to be reported as State grants.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that the district establish policies and procedures to ensure that grant activity is recorded in the general ledger timely and accurately. Internal controls should also be designed to prevent, detect, or correct errors and omissions in a timely manner.District's Response: Grant agreement for ESSER funds was not signed and fully executed until August 2020 and the other was November 2020. Yes we went back to prior year to capture from the time frame allowable by the grant agreement of March 13, 2020, the auditors most likely should have restated 2019-20 financial statements with the un-precedented times of federal dollars been given in short time frames. Discussed in #1 & 2 that there was mistakes made on 2020-21 SEFA because of the roll forward and the fact that they should brought to my attention that I was miss-ing/incorrect or inadvertently added an incorrect grant.Corrective Action Plan: The District will do adjusting entries into a separate fund in order to capture all poten-tial expenditures related to the grant that has been backdated by Oregon Department of Education or any other entity that has awarded the District with funds. The District will also alert the engaged audit firm of any changes that will affect a prior year of any grants that could potentially be retrospect back. To ensure there should be a re-statement of a prior year audit.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
During the audit of Lake County School District No. 7 for Fiscal Year 2020-2021, the district was un-able to provide auditor with separate and identifiable General Ledger reports that clearly showed expenditures and revenues for all federal grants. This deficiency was instrumental in causing the general ledger to be inadequate for financial and Federal Award Reporting.Cause: The District relied on an Excel worksheet for gathering expenditures for ESSER grants on a retrospective basis. No distinct division of expenditures for the grant was available in their general ledger. These expenditures were gathered from a number of departments, which separately are subject to their own state or federal reporting.Effect or Potential Effect: Failure to record transactions properly into the general ledger for Lake County School District No. 7, and lack of proper accounting structure separating revenues and expenditures into each Federal grant may result in transactions not being properly included in the district?s financial statements. The potential for incorrect financial reporting, and untimely results, with the inability to rely on the general ledger for correct and timely information, may also cause misstatement of financial statements, inappropriate reporting of federal or state awards, and the potential for inadvertent duplicate expenditure reporting.Questioned Cost: NoContext: The general ledger did not include separate expenditures codes for the ESSER grants. Information for expenditure reporting was recorded on an Excel worksheet from several function areas of the general ledger. Many of the expenditures were accumulated to the worksheet retrospectively, and no matching entries were pre-pared in the general ledger to record the expenditures as ESSER. Not designating these expenditures as ESSER can cause the potential for these expenditures to be reported to multiple programs.Section II?Financial Statements Findings Cont.)In addition, there was not a proper cutoff for year-end expenditures for the ESSER I (Cares) Grant. During FY 2020-2021 $130,093 of prior year expenditures were recorded in the excel worksheet, and presented for reim-bursement in the current year. The District did not designate these expenditures as ESSER I in the prior year, result-ing in the potential for these expenditures to be reported as expenditures for multiple programs. Many of the ESSER I,II and GEER expenditures for fiscal year 2020-2021 were also accumulated in this way, without the use of separate expenditure codes designating the purpose of the expenditure within the accounting system. Due to this issue, general ledger expenditures of federal awards did not match the final SEFA for fiscal year 2020-2021. This issue also contributed to an under-recording of revenues from Federal grants of $130,093 in fiscal year 2019-2020.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that Lake County School District No. 7 improve their general ledger structure to meet the requirement for separate accounts for Federal awards for program revenues and program expenditures. We also recommend that the district establish policies and procedures to ensure that all program revenues and ex-penditures are reported in the correct fiscal year. In addition, we recommend that the district establish a training program and policies and procedures for staff and management to receive appropriate training for administering and recording Federal Grant revenues and expenditures.District's Response: As described prior we did go back for billing purposes to capture eligible expenditures in prior year 2019-20, we also purchased a lot of computer hardware and software to meet the criteria of one to one opportu-nities for every child in school including Lakeview Academy students. We did however have a consistent source of bill-ing to ESSER Funds, which including Lakeview Academy Staff/Principal and our Daycare program. These were in the general fund however in their own function code. The possibility of billing to another source for reimbursement is very unlikely due to the fact that all grants are run through a special 200 series fund. We also upon receiving ESSER III dollars have moved it to its own special 200 series fund.Corrective Action Plan: The District will do adjusting entries into a separate fund in order to capture all poten-tial expenditures related to the grant that has been backdated by Oregon Department of Education or any other entity that has awarded the District with funds. The District will also alert the engaged audit firm of any changes that will affect a prior year of any grants that could potentially be retrospect back. To ensure there should be a re-statement of a prior year audit.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
Show full finding ▾Hide full finding ▴Finding 2021-004 ? Fiscal Management System, Ensure Compliance with Federal Regulations Over Account-ing Systems (Material Weakness)Criteria: Management is responsible for establishing and maintaining effective internal control over financial re-porting. Internal controls should allow management or employees in the normal course of performing their as-signed functions to prevent or detect material misstatements in the financial reporting of all district funds.The Internal Control ? Integrated Framework, published by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and the U.S. Government Accountability Office Standards for Internal Control in the Federal Government specify that a satisfactory control environment is only effective when there are adequate control activities in place.Effective control activities dictate that a review is performed to verify the accuracy and completeness of financial information reported. The Federal Grant Activity Schedule captures amounts that must be accurate and complete in order to ensure the accuracy of the financial and federal information reported on such schedule to verify the ac-curacy and completeness of financial information reported.CFR Part 200.302.b Auditee Responsibilities includes the requirement that the financial management system of each non-Federal entity provide the following. Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. Accurate, current, and complete disclosure of the financial results of each Federal award or program.Condition: During the audit of Lake County School District No. 7 for Fiscal Year 2020-2021, the district was un-able to provide auditor with separate and identifiable General Ledger reports that clearly showed expenditures and revenues for all federal grants. This deficiency was instrumental in causing the general ledger to be inadequate for financial and Federal Award Reporting.Cause: The District relied on an Excel worksheet for gathering expenditures for ESSER grants on a retrospective basis. No distinct division of expenditures for the grant was available in their general ledger. These expenditures were gathered from a number of departments, which separately are subject to their own state or federal reporting.Effect or Potential Effect: Failure to record transactions properly into the general ledger for Lake County School District No. 7, and lack of proper accounting structure separating revenues and expenditures into each Federal grant may result in transactions not being properly included in the district?s financial statements. The potential for incorrect financial reporting, and untimely results, with the inability to rely on the general ledger for correct and timely information, may also cause misstatement of financial statements, inappropriate reporting of federal or state awards, and the potential for inadvertent duplicate expenditure reporting.Questioned Cost: NoContext: The general ledger did not include separate expenditures codes for the ESSER grants. Information for expenditure reporting was recorded on an Excel worksheet from several function areas of the general ledger. Many of the expenditures were accumulated to the worksheet retrospectively, and no matching entries were pre-pared in the general ledger to record the expenditures as ESSER. Not designating these expenditures as ESSER can cause the potential for these expenditures to be reported to multiple programs.Section II?Financial Statements Findings Cont.)In addition, there was not a proper cutoff for year-end expenditures for the ESSER I (Cares) Grant. During FY 2020-2021 $130,093 of prior year expenditures were recorded in the excel worksheet, and presented for reim-bursement in the current year. The District did not designate these expenditures as ESSER I in the prior year, result-ing in the potential for these expenditures to be reported as expenditures for multiple programs. Many of the ESSER I,II and GEER expenditures for fiscal year 2020-2021 were also accumulated in this way, without the use of separate expenditure codes designating the purpose of the expenditure within the accounting system. Due to this issue, general ledger expenditures of federal awards did not match the final SEFA for fiscal year 2020-2021. This issue also contributed to an under-recording of revenues from Federal grants of $130,093 in fiscal year 2019-2020.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that Lake County School District No. 7 improve their general ledger structure to meet the requirement for separate accounts for Federal awards for program revenues and program expenditures. We also recommend that the district establish policies and procedures to ensure that all program revenues and ex-penditures are reported in the correct fiscal year. In addition, we recommend that the district establish a training program and policies and procedures for staff and management to receive appropriate training for administering and recording Federal Grant revenues and expenditures.District's Response: As described prior we did go back for billing purposes to capture eligible expenditures in prior year 2019-20, we also purchased a lot of computer hardware and software to meet the criteria of one to one opportu-nities for every child in school including Lakeview Academy students. We did however have a consistent source of bill-ing to ESSER Funds, which including Lakeview Academy Staff/Principal and our Daycare program. These were in the general fund however in their own function code. The possibility of billing to another source for reimbursement is very unlikely due to the fact that all grants are run through a special 200 series fund. We also upon receiving ESSER III dollars have moved it to its own special 200 series fund.Corrective Action Plan: The District will do adjusting entries into a separate fund in order to capture all poten-tial expenditures related to the grant that has been backdated by Oregon Department of Education or any other entity that has awarded the District with funds. The District will also alert the engaged audit firm of any changes that will affect a prior year of any grants that could potentially be retrospect back. To ensure there should be a re-statement of a prior year audit.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
Finding 2021-004 ? Fiscal Management System, Ensure Compliance with Federal Regulations Over Account-ing Systems (Material Weakness)Criteria: Management is responsible for establishing and maintaining effective internal control over financial re-porting. Internal controls should allow management or employees in the normal course of performing their as-signed functions to prevent or detect material misstatements in the financial reporting of all district funds.The Internal Control ? Integrated Framework, published by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and the U.S. Government Accountability Office Standards for Internal Control in the Federal Government specify that a satisfactory control environment is only effective when there are adequate control activities in place.Effective control activities dictate that a review is performed to verify the accuracy and completeness of financial information reported. The Federal Grant Activity Schedule captures amounts that must be accurate and complete in order to ensure the accuracy of the financial and federal information reported on such schedule to verify the ac-curacy and completeness of financial information reported.CFR Part 200.302.b Auditee Responsibilities includes the requirement that the financial management system of each non-Federal entity provide the following. Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. Accurate, current, and complete disclosure of the financial results of each Federal award or program.Condition: During the audit of Lake County School District No. 7 for Fiscal Year 2020-2021, the district was un-able to provide auditor with separate and identifiable General Ledger reports that clearly showed expenditures and revenues for all federal grants. This deficiency was instrumental in causing the general ledger to be inadequate for financial and Federal Award Reporting.Cause: The District relied on an Excel worksheet for gathering expenditures for ESSER grants on a retrospective basis. No distinct division of expenditures for the grant was available in their general ledger. These expenditures were gathered from a number of departments, which separately are subject to their own state or federal reporting.Effect or Potential Effect: Failure to record transactions properly into the general ledger for Lake County School District No. 7, and lack of proper accounting structure separating revenues and expenditures into each Federal grant may result in transactions not being properly included in the district?s financial statements. The potential for incorrect financial reporting, and untimely results, with the inability to rely on the general ledger for correct and timely information, may also cause misstatement of financial statements, inappropriate reporting of federal or state awards, and the potential for inadvertent duplicate expenditure reporting.Questioned Cost: NoContext: The general ledger did not include separate expenditures codes for the ESSER grants. Information for expenditure reporting was recorded on an Excel worksheet from several function areas of the general ledger. Many of the expenditures were accumulated to the worksheet retrospectively, and no matching entries were pre-pared in the general ledger to record the expenditures as ESSER. Not designating these expenditures as ESSER can cause the potential for these expenditures to be reported to multiple programs.Section II?Financial Statements Findings Cont.)In addition, there was not a proper cutoff for year-end expenditures for the ESSER I (Cares) Grant. During FY 2020-2021 $130,093 of prior year expenditures were recorded in the excel worksheet, and presented for reim-bursement in the current year. The District did not designate these expenditures as ESSER I in the prior year, result-ing in the potential for these expenditures to be reported as expenditures for multiple programs. Many of the ESSER I,II and GEER expenditures for fiscal year 2020-2021 were also accumulated in this way, without the use of separate expenditure codes designating the purpose of the expenditure within the accounting system. Due to this issue, general ledger expenditures of federal awards did not match the final SEFA for fiscal year 2020-2021. This issue also contributed to an under-recording of revenues from Federal grants of $130,093 in fiscal year 2019-2020.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that Lake County School District No. 7 improve their general ledger structure to meet the requirement for separate accounts for Federal awards for program revenues and program expenditures. We also recommend that the district establish policies and procedures to ensure that all program revenues and ex-penditures are reported in the correct fiscal year. In addition, we recommend that the district establish a training program and policies and procedures for staff and management to receive appropriate training for administering and recording Federal Grant revenues and expenditures.District's Response: As described prior we did go back for billing purposes to capture eligible expenditures in prior year 2019-20, we also purchased a lot of computer hardware and software to meet the criteria of one to one opportu-nities for every child in school including Lakeview Academy students. We did however have a consistent source of bill-ing to ESSER Funds, which including Lakeview Academy Staff/Principal and our Daycare program. These were in the general fund however in their own function code. The possibility of billing to another source for reimbursement is very unlikely due to the fact that all grants are run through a special 200 series fund. We also upon receiving ESSER III dollars have moved it to its own special 200 series fund.Corrective Action Plan: The District will do adjusting entries into a separate fund in order to capture all poten-tial expenditures related to the grant that has been backdated by Oregon Department of Education or any other entity that has awarded the District with funds. The District will also alert the engaged audit firm of any changes that will affect a prior year of any grants that could potentially be retrospect back. To ensure there should be a re-statement of a prior year audit.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
The District prepared calculations for ESSER grants dependent on an internal spreadsheet tool outside of the General Ledger rather than utilizing specific general ledger expenditure accounting with supporting backup information for those entries. Therefore, there were discrepancies in timing of expenditures between fiscal years.Cause: General ledger reconciling procedures were not enforced or completed. General Ledger cutoff was not enforced.Effect or Potential Effect: Activities or costs that are allowed or allowable could potentially be overpaid or un-derpaid. Duplication of expenditures may result. Expenditures may not be reported in correct Fiscal Year.Questioned Cost: NoContext: During the testing of expenditures, it was found that no specific general ledger accounts or account codes were prepared for the federal ESSER grants. A spreadsheet gathering expenditures, prepared retrospectively, was utilized for gathering the costs to report to the state grant administrator. Reimbursement requests for ESSER in fiscal year 2020-2021 included $130,093 of expenditures from fiscal year 2019-2020 based upon the retrospec-tive expenditure spreadsheet. While requesting reimbursement for prior year costs is not a compliance issue, the lack of using the accounting system to clearly identify federal expenditures is noncompliant, and creates opportu-nities for errors in making claims for expenditures that may have already been used for other program claims.Repeat of a Prior-Year Finding: NoSection III?Findings and Questioned Costs for Federal Awards (Cont.)Recommendation: The District should establish policies and procedures to ensure that each reimbursement re-quest is reconciled with supporting expenditure documents and general ledger postings prior to reimbursement be-ing requested.District's Response: Accounting software was used first and foremost with proper approval processes in place. A spreadsheet was used to gather all the purchases that were eligible in one spot. However that spreadsheet was also derived out of the accounting software. The state grant administrator did require us to fill out a spreadsheet that they designed for prior approval of drawing down funds from any one of the ESSER Grants. Again, as mentioned in Finding #4 there were function codes in place that were specific to ESSER funds.Corrective Action Plan: The District holds separate hard copy files with general ledger print outs for each re-quested draw. This has been a standard in the Business Manager?s Office. The file includes specific to the fund and has the draw down print out from Oregon Dept of Educ EGMS system, along with general ledger detail to support said amount, which includes any and all account numbers along with a description of the account num-bers and the amount associated with. Auditors prior to Umpqua have requested those files for review. In this case the District will press upon the auditors of engagement that they must look at these files for the assurance that the numbers are justified.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
Show full finding ▾Hide full finding ▴Finding 2021-005 - Source Documentation (Material Weakness)CFDA Title and Number 84.425 (D) (C) Education Stabilization FundName of Federal Agency: US Department of Education ClusterCompliance/Internal Control over Compliance: Auditee ResponsibilitiesCriteria: 2 CFR Part 200.302(b)(1) The financial management system of each non-federal entity must provide for the following: Identification, in its accounts, of all Federal awards received and expended and the Federal pro-grams under which they were received. 200.302(b)(2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in 200.328 and 200.329.Condition: The District prepared calculations for ESSER grants dependent on an internal spreadsheet tool outside of the General Ledger rather than utilizing specific general ledger expenditure accounting with supporting backup information for those entries. Therefore, there were discrepancies in timing of expenditures between fiscal years.Cause: General ledger reconciling procedures were not enforced or completed. General Ledger cutoff was not enforced.Effect or Potential Effect: Activities or costs that are allowed or allowable could potentially be overpaid or un-derpaid. Duplication of expenditures may result. Expenditures may not be reported in correct Fiscal Year.Questioned Cost: NoContext: During the testing of expenditures, it was found that no specific general ledger accounts or account codes were prepared for the federal ESSER grants. A spreadsheet gathering expenditures, prepared retrospectively, was utilized for gathering the costs to report to the state grant administrator. Reimbursement requests for ESSER in fiscal year 2020-2021 included $130,093 of expenditures from fiscal year 2019-2020 based upon the retrospec-tive expenditure spreadsheet. While requesting reimbursement for prior year costs is not a compliance issue, the lack of using the accounting system to clearly identify federal expenditures is noncompliant, and creates opportu-nities for errors in making claims for expenditures that may have already been used for other program claims.Repeat of a Prior-Year Finding: NoSection III?Findings and Questioned Costs for Federal Awards (Cont.)Recommendation: The District should establish policies and procedures to ensure that each reimbursement re-quest is reconciled with supporting expenditure documents and general ledger postings prior to reimbursement be-ing requested.District's Response: Accounting software was used first and foremost with proper approval processes in place. A spreadsheet was used to gather all the purchases that were eligible in one spot. However that spreadsheet was also derived out of the accounting software. The state grant administrator did require us to fill out a spreadsheet that they designed for prior approval of drawing down funds from any one of the ESSER Grants. Again, as mentioned in Finding #4 there were function codes in place that were specific to ESSER funds.Corrective Action Plan: The District holds separate hard copy files with general ledger print outs for each re-quested draw. This has been a standard in the Business Manager?s Office. The file includes specific to the fund and has the draw down print out from Oregon Dept of Educ EGMS system, along with general ledger detail to support said amount, which includes any and all account numbers along with a description of the account num-bers and the amount associated with. Auditors prior to Umpqua have requested those files for review. In this case the District will press upon the auditors of engagement that they must look at these files for the assurance that the numbers are justified.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
Finding 2021-005 - Source Documentation (Material Weakness)CFDA Title and Number 84.425 (D) (C) Education Stabilization FundName of Federal Agency: US Department of Education ClusterCompliance/Internal Control over Compliance: Auditee ResponsibilitiesCriteria: 2 CFR Part 200.302(b)(1) The financial management system of each non-federal entity must provide for the following: Identification, in its accounts, of all Federal awards received and expended and the Federal pro-grams under which they were received. 200.302(b)(2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in 200.328 and 200.329.Condition: The District prepared calculations for ESSER grants dependent on an internal spreadsheet tool outside of the General Ledger rather than utilizing specific general ledger expenditure accounting with supporting backup information for those entries. Therefore, there were discrepancies in timing of expenditures between fiscal years.Cause: General ledger reconciling procedures were not enforced or completed. General Ledger cutoff was not enforced.Effect or Potential Effect: Activities or costs that are allowed or allowable could potentially be overpaid or un-derpaid. Duplication of expenditures may result. Expenditures may not be reported in correct Fiscal Year.Questioned Cost: NoContext: During the testing of expenditures, it was found that no specific general ledger accounts or account codes were prepared for the federal ESSER grants. A spreadsheet gathering expenditures, prepared retrospectively, was utilized for gathering the costs to report to the state grant administrator. Reimbursement requests for ESSER in fiscal year 2020-2021 included $130,093 of expenditures from fiscal year 2019-2020 based upon the retrospec-tive expenditure spreadsheet. While requesting reimbursement for prior year costs is not a compliance issue, the lack of using the accounting system to clearly identify federal expenditures is noncompliant, and creates opportu-nities for errors in making claims for expenditures that may have already been used for other program claims.Repeat of a Prior-Year Finding: NoSection III?Findings and Questioned Costs for Federal Awards (Cont.)Recommendation: The District should establish policies and procedures to ensure that each reimbursement re-quest is reconciled with supporting expenditure documents and general ledger postings prior to reimbursement be-ing requested.District's Response: Accounting software was used first and foremost with proper approval processes in place. A spreadsheet was used to gather all the purchases that were eligible in one spot. However that spreadsheet was also derived out of the accounting software. The state grant administrator did require us to fill out a spreadsheet that they designed for prior approval of drawing down funds from any one of the ESSER Grants. Again, as mentioned in Finding #4 there were function codes in place that were specific to ESSER funds.Corrective Action Plan: The District holds separate hard copy files with general ledger print outs for each re-quested draw. This has been a standard in the Business Manager?s Office. The file includes specific to the fund and has the draw down print out from Oregon Dept of Educ EGMS system, along with general ledger detail to support said amount, which includes any and all account numbers along with a description of the account num-bers and the amount associated with. Auditors prior to Umpqua have requested those files for review. In this case the District will press upon the auditors of engagement that they must look at these files for the assurance that the numbers are justified.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
The Schedule of Expenditures of Federal Awards (SEFA) presented for audit included several signifi-cant unreconciled differences between the SEFA and the General Ledger. The District did not attempt to complete such a reconciliation.Cause: Lake County School District No. 7 does not have effective internal control over the preparation of the SEFA. The district did not reconcile the expenditures reported on the SEFA with the amounts reported on the dis-trict?s general ledger.Effect or Potential Effect: Potential understatement or overstatement of expenditures could exist in the Schedule of Expenditures of Federal Awards and not be detected and corrected. Because the Auditee?s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors? correction recommendations.Questioned Cost: NoSection III?Findings and Questioned Costs for Federal Awards (Cont.)Context: The SEFA presented for audit did not reconcile to the general ledger for Federal Awards. No reconcilia-tion between federal expenditures reported on the GL and the SEFA was presented to the auditors or otherwise noted.? Expenditures for the ESSER grants were kept on worksheets outside of the general ledger and resulted in ESSER expenditures not being reported on the Auditee?s SEFA.? No Rural and Low-Income Schools expenditures were included in the Schedule of Expenditures of Federal Awards although the receipt of the federal revenue was properly recorded as such in the general ledger. The result was an under-statement of the expenditures on the Auditee?s SEFA.? Expenditures related to federal ESSER grant revenues received from Lake County ESD were not included on the Auditee?s SEFA. The revenue was recorded as federal in the GL, but expenditures were not separat-ed into unique account codes related to this award. The result was an under-statement of the expenditures of Federal Awards on the Auditee?s SEFA.? Commodities received from the U.S. Department of Agriculture were not recorded in the GL in accounts identified as federal commodities received, and the amounts reported on the Auditee?s SEFA do not agree with the reported amounts from ODE.? Accruals for various federal grants were not appropriately reported on the Auditee?s SEFA.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that the district establish policies and procedures to ensure that all Federal awards are identified and reported accurately on the SEFA. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The district should provide appropriate training to staff who are assigned to pre-pare and review the SEFA.District's Response: 2019-20 SEFA was reported incorrectly and a REVISED 2019-20 was submitted to ODE per their request. I did not originally do the SEFA for 2019-20, I believe that the auditors from Umpqua did it on their own. I rolled forward from 2019-20, causing my 2020-21 to come through incorrectly. I had missed RLIS and ESSER grants on the SEFA.Corrective Action Plan: This correction plan, the District feels is in line with Finding #2, please refer to above.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
Show full finding ▾Hide full finding ▴Finding 2021-006 ? Schedule of Expenditures of Federal Awards (Material Weakness)CFDA Title and Number 84.425 (D) (C) Education Stabilization FundName of Federal Agency: US Department of Education ClusterCompliance/Internal Control over Compliance: Auditee ResponsibilitiesCriteria: CFR Part 200.508, CFR Part 200.510, Auditee Responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list individual Federal awards by Federal Agency, in-cluding the total Federal awards expended, name of the pass-through entity, CFDA number, and total amount pro-vided to subrecipients. The information contained in the Schedule of Expenditures of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial state-ments.Condition: The Schedule of Expenditures of Federal Awards (SEFA) presented for audit included several signifi-cant unreconciled differences between the SEFA and the General Ledger. The District did not attempt to complete such a reconciliation.Cause: Lake County School District No. 7 does not have effective internal control over the preparation of the SEFA. The district did not reconcile the expenditures reported on the SEFA with the amounts reported on the dis-trict?s general ledger.Effect or Potential Effect: Potential understatement or overstatement of expenditures could exist in the Schedule of Expenditures of Federal Awards and not be detected and corrected. Because the Auditee?s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors? correction recommendations.Questioned Cost: NoSection III?Findings and Questioned Costs for Federal Awards (Cont.)Context: The SEFA presented for audit did not reconcile to the general ledger for Federal Awards. No reconcilia-tion between federal expenditures reported on the GL and the SEFA was presented to the auditors or otherwise noted.? Expenditures for the ESSER grants were kept on worksheets outside of the general ledger and resulted in ESSER expenditures not being reported on the Auditee?s SEFA.? No Rural and Low-Income Schools expenditures were included in the Schedule of Expenditures of Federal Awards although the receipt of the federal revenue was properly recorded as such in the general ledger. The result was an under-statement of the expenditures on the Auditee?s SEFA.? Expenditures related to federal ESSER grant revenues received from Lake County ESD were not included on the Auditee?s SEFA. The revenue was recorded as federal in the GL, but expenditures were not separat-ed into unique account codes related to this award. The result was an under-statement of the expenditures of Federal Awards on the Auditee?s SEFA.? Commodities received from the U.S. Department of Agriculture were not recorded in the GL in accounts identified as federal commodities received, and the amounts reported on the Auditee?s SEFA do not agree with the reported amounts from ODE.? Accruals for various federal grants were not appropriately reported on the Auditee?s SEFA.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that the district establish policies and procedures to ensure that all Federal awards are identified and reported accurately on the SEFA. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The district should provide appropriate training to staff who are assigned to pre-pare and review the SEFA.District's Response: 2019-20 SEFA was reported incorrectly and a REVISED 2019-20 was submitted to ODE per their request. I did not originally do the SEFA for 2019-20, I believe that the auditors from Umpqua did it on their own. I rolled forward from 2019-20, causing my 2020-21 to come through incorrectly. I had missed RLIS and ESSER grants on the SEFA.Corrective Action Plan: This correction plan, the District feels is in line with Finding #2, please refer to above.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
Finding 2021-006 ? Schedule of Expenditures of Federal Awards (Material Weakness)CFDA Title and Number 84.425 (D) (C) Education Stabilization FundName of Federal Agency: US Department of Education ClusterCompliance/Internal Control over Compliance: Auditee ResponsibilitiesCriteria: CFR Part 200.508, CFR Part 200.510, Auditee Responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list individual Federal awards by Federal Agency, in-cluding the total Federal awards expended, name of the pass-through entity, CFDA number, and total amount pro-vided to subrecipients. The information contained in the Schedule of Expenditures of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial state-ments.Condition: The Schedule of Expenditures of Federal Awards (SEFA) presented for audit included several signifi-cant unreconciled differences between the SEFA and the General Ledger. The District did not attempt to complete such a reconciliation.Cause: Lake County School District No. 7 does not have effective internal control over the preparation of the SEFA. The district did not reconcile the expenditures reported on the SEFA with the amounts reported on the dis-trict?s general ledger.Effect or Potential Effect: Potential understatement or overstatement of expenditures could exist in the Schedule of Expenditures of Federal Awards and not be detected and corrected. Because the Auditee?s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors? correction recommendations.Questioned Cost: NoSection III?Findings and Questioned Costs for Federal Awards (Cont.)Context: The SEFA presented for audit did not reconcile to the general ledger for Federal Awards. No reconcilia-tion between federal expenditures reported on the GL and the SEFA was presented to the auditors or otherwise noted.? Expenditures for the ESSER grants were kept on worksheets outside of the general ledger and resulted in ESSER expenditures not being reported on the Auditee?s SEFA.? No Rural and Low-Income Schools expenditures were included in the Schedule of Expenditures of Federal Awards although the receipt of the federal revenue was properly recorded as such in the general ledger. The result was an under-statement of the expenditures on the Auditee?s SEFA.? Expenditures related to federal ESSER grant revenues received from Lake County ESD were not included on the Auditee?s SEFA. The revenue was recorded as federal in the GL, but expenditures were not separat-ed into unique account codes related to this award. The result was an under-statement of the expenditures of Federal Awards on the Auditee?s SEFA.? Commodities received from the U.S. Department of Agriculture were not recorded in the GL in accounts identified as federal commodities received, and the amounts reported on the Auditee?s SEFA do not agree with the reported amounts from ODE.? Accruals for various federal grants were not appropriately reported on the Auditee?s SEFA.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that the district establish policies and procedures to ensure that all Federal awards are identified and reported accurately on the SEFA. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The district should provide appropriate training to staff who are assigned to pre-pare and review the SEFA.District's Response: 2019-20 SEFA was reported incorrectly and a REVISED 2019-20 was submitted to ODE per their request. I did not originally do the SEFA for 2019-20, I believe that the auditors from Umpqua did it on their own. I rolled forward from 2019-20, causing my 2020-21 to come through incorrectly. I had missed RLIS and ESSER grants on the SEFA.Corrective Action Plan: This correction plan, the District feels is in line with Finding #2, please refer to above.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
During our audit, we found errors in expenditure-driven grants where receivables and reve-nue/unavailable revenue were misstated. A grant reimbursement request for expenditures was made but was not recorded in the general ledger revenue or receivables at year end.Cause: The District does not have appropriate procedures in place to ensure that receivables and reve-nue/unavailable revenue are properly recorded in the general ledger. Grant receivables and revenue/unavailable revenue were not tracked and reconciled to the general ledger.Effect or Potential Effect: Misstatement of grant receivables and revenue/unavailable revenue.Context: At 2020-2021fiscal year end, the District had unrecorded revenues from ESSER grants of $136,652. In addition, a number receivables related to non-major grants were similarly not recorded.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that the district establish policies and procedures to ensure that grant activity is recorded in the general ledger timely and accurately. Internal controls should also be designed to prevent, detect, or correct errors in a timely manner.District's Response: We are on a cash basis method of accounting. I would not record the receivables or payables (that was not written as a finding) on our books. However, when we report in our audit report we do convert over to a Modified Accrual method of Accounting for reporting purposes only.Corrective Action Plan: The District has a plan to move towards Modified Cash Basis effective in the FY 2023-24. The District struggles with engaged auditors on the Cash Basis of Accounting. Also, the District beginning in FY 2023-24 will prepare their own financial statements to present to auditors during the audit, as to element any finding of preparing our own financial statements. Best practice is not to implement a change in accounting basis mid year.Planned Implementation Date: July 1, 2023Responsible Person: Business Manager, Lake County School District No. 7
Show full finding ▾Hide full finding ▴Finding 2021-007 ? Accounting for Grants (Material Weakness)CFDA Title and Number 84.425 (D) (C) Education Stabilization FundName of Federal Agency: US Department of Education ClusterCompliance/Internal Control over Compliance: Auditee ResponsibilitiesCriteria: CFR Part 200.508 Auditee Responsibilities. For grants based on a formula, a receivable and reve-nue/unavailable revenue should be recognized as soon as all eligibility requirements have been met. For expendi-ture-driven grants (reimbursement-type grants), a receivable and revenue/unavailable revenue should be recog-nized when both qualifying expenditures and compliance with contingent requirements such as matching funds, are met. Unavailable revenue is revenue of the current period that is not yet considered available to liquidate lia-bilities of the current period.Section III?Findings and Questioned Costs for Federal Awards (Cont.)Condition: During our audit, we found errors in expenditure-driven grants where receivables and reve-nue/unavailable revenue were misstated. A grant reimbursement request for expenditures was made but was not recorded in the general ledger revenue or receivables at year end.Cause: The District does not have appropriate procedures in place to ensure that receivables and reve-nue/unavailable revenue are properly recorded in the general ledger. Grant receivables and revenue/unavailable revenue were not tracked and reconciled to the general ledger.Effect or Potential Effect: Misstatement of grant receivables and revenue/unavailable revenue.Context: At 2020-2021fiscal year end, the District had unrecorded revenues from ESSER grants of $136,652. In addition, a number receivables related to non-major grants were similarly not recorded.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that the district establish policies and procedures to ensure that grant activity is recorded in the general ledger timely and accurately. Internal controls should also be designed to prevent, detect, or correct errors in a timely manner.District's Response: We are on a cash basis method of accounting. I would not record the receivables or payables (that was not written as a finding) on our books. However, when we report in our audit report we do convert over to a Modified Accrual method of Accounting for reporting purposes only.Corrective Action Plan: The District has a plan to move towards Modified Cash Basis effective in the FY 2023-24. The District struggles with engaged auditors on the Cash Basis of Accounting. Also, the District beginning in FY 2023-24 will prepare their own financial statements to present to auditors during the audit, as to element any finding of preparing our own financial statements. Best practice is not to implement a change in accounting basis mid year.Planned Implementation Date: July 1, 2023Responsible Person: Business Manager, Lake County School District No. 7
Finding 2021-007 ? Accounting for Grants (Material Weakness)CFDA Title and Number 84.425 (D) (C) Education Stabilization FundName of Federal Agency: US Department of Education ClusterCompliance/Internal Control over Compliance: Auditee ResponsibilitiesCriteria: CFR Part 200.508 Auditee Responsibilities. For grants based on a formula, a receivable and reve-nue/unavailable revenue should be recognized as soon as all eligibility requirements have been met. For expendi-ture-driven grants (reimbursement-type grants), a receivable and revenue/unavailable revenue should be recog-nized when both qualifying expenditures and compliance with contingent requirements such as matching funds, are met. Unavailable revenue is revenue of the current period that is not yet considered available to liquidate lia-bilities of the current period.Section III?Findings and Questioned Costs for Federal Awards (Cont.)Condition: During our audit, we found errors in expenditure-driven grants where receivables and reve-nue/unavailable revenue were misstated. A grant reimbursement request for expenditures was made but was not recorded in the general ledger revenue or receivables at year end.Cause: The District does not have appropriate procedures in place to ensure that receivables and reve-nue/unavailable revenue are properly recorded in the general ledger. Grant receivables and revenue/unavailable revenue were not tracked and reconciled to the general ledger.Effect or Potential Effect: Misstatement of grant receivables and revenue/unavailable revenue.Context: At 2020-2021fiscal year end, the District had unrecorded revenues from ESSER grants of $136,652. In addition, a number receivables related to non-major grants were similarly not recorded.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that the district establish policies and procedures to ensure that grant activity is recorded in the general ledger timely and accurately. Internal controls should also be designed to prevent, detect, or correct errors in a timely manner.District's Response: We are on a cash basis method of accounting. I would not record the receivables or payables (that was not written as a finding) on our books. However, when we report in our audit report we do convert over to a Modified Accrual method of Accounting for reporting purposes only.Corrective Action Plan: The District has a plan to move towards Modified Cash Basis effective in the FY 2023-24. The District struggles with engaged auditors on the Cash Basis of Accounting. Also, the District beginning in FY 2023-24 will prepare their own financial statements to present to auditors during the audit, as to element any finding of preparing our own financial statements. Best practice is not to implement a change in accounting basis mid year.Planned Implementation Date: July 1, 2023Responsible Person: Business Manager, Lake County School District No. 7
During the audit of Lake County School District No. 7 for Fiscal Year 2020-2021, the District was un-able to provide auditor with the required property and equipment schedule for IT equipment purchased with the ESSER grants.Cause: District management did not have sufficient training or monitoring policies to recognize and correct the deficiency.Effect or Potential Effect: Unapproved use of equipment purchased with federal funds, and the inability to re-port on the location and current use of equipment or use such reports to maintain adequate safeguards.Section III?Findings and Questioned Costs for Federal Awards (Cont.)Questioned Cost: NoContext: After numerous requests by auditors, the required schedules were not provided. The apparent lack of accountability leaves Lake County School District #7 unable to meet the requirements identified in CFR Part 200.313.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that Lake County School District No. 7 improve their property and equipment tracking systems in order to meet relevant federal requirements.District's Response: We did provide them with the IT equipment that was purchased with ESSER funds, where we failed was in giving them the location and a tag or serial number of each item. We do have this information available and has already been prepared by the IT Department.Corrective Action Plan: The District has educated the IT Department of their duty to document by serial number and keep inventory of all purchases through federal dollars. The Business Manager and IT Supervisor will work closely to ensure that all items stemming from federal dollars have an inventory and tracked through a serial number or District tag, if appropriate.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
Show full finding ▾Hide full finding ▴Finding 2021-008 ? Fiscal Management System (Material Weakness)Criteria: CFR Part 200.313 Accounting for Equipment includes the requirement that equipment purchased with federal award funds will meet at a minimum the following requirements. There is no minimum capital requirement definition. 1) Property records must be maintained that include a description of the property, a serial number or ID number, the source of funding for the asset, who holds title to the asset, the acquisition date, percentage of federal contribution, the location of the equipment, the use and condition of the equipment, and the ultimate disposition of the equipment. 2) A physical inventory of the property/equipment 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.Condition: During the audit of Lake County School District No. 7 for Fiscal Year 2020-2021, the District was un-able to provide auditor with the required property and equipment schedule for IT equipment purchased with the ESSER grants.Cause: District management did not have sufficient training or monitoring policies to recognize and correct the deficiency.Effect or Potential Effect: Unapproved use of equipment purchased with federal funds, and the inability to re-port on the location and current use of equipment or use such reports to maintain adequate safeguards.Section III?Findings and Questioned Costs for Federal Awards (Cont.)Questioned Cost: NoContext: After numerous requests by auditors, the required schedules were not provided. The apparent lack of accountability leaves Lake County School District #7 unable to meet the requirements identified in CFR Part 200.313.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that Lake County School District No. 7 improve their property and equipment tracking systems in order to meet relevant federal requirements.District's Response: We did provide them with the IT equipment that was purchased with ESSER funds, where we failed was in giving them the location and a tag or serial number of each item. We do have this information available and has already been prepared by the IT Department.Corrective Action Plan: The District has educated the IT Department of their duty to document by serial number and keep inventory of all purchases through federal dollars. The Business Manager and IT Supervisor will work closely to ensure that all items stemming from federal dollars have an inventory and tracked through a serial number or District tag, if appropriate.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
Finding 2021-008 ? Fiscal Management System (Material Weakness)Criteria: CFR Part 200.313 Accounting for Equipment includes the requirement that equipment purchased with federal award funds will meet at a minimum the following requirements. There is no minimum capital requirement definition. 1) Property records must be maintained that include a description of the property, a serial number or ID number, the source of funding for the asset, who holds title to the asset, the acquisition date, percentage of federal contribution, the location of the equipment, the use and condition of the equipment, and the ultimate disposition of the equipment. 2) A physical inventory of the property/equipment 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.Condition: During the audit of Lake County School District No. 7 for Fiscal Year 2020-2021, the District was un-able to provide auditor with the required property and equipment schedule for IT equipment purchased with the ESSER grants.Cause: District management did not have sufficient training or monitoring policies to recognize and correct the deficiency.Effect or Potential Effect: Unapproved use of equipment purchased with federal funds, and the inability to re-port on the location and current use of equipment or use such reports to maintain adequate safeguards.Section III?Findings and Questioned Costs for Federal Awards (Cont.)Questioned Cost: NoContext: After numerous requests by auditors, the required schedules were not provided. The apparent lack of accountability leaves Lake County School District #7 unable to meet the requirements identified in CFR Part 200.313.Repeat of a Prior-Year Finding: NoRecommendation: We recommend that Lake County School District No. 7 improve their property and equipment tracking systems in order to meet relevant federal requirements.District's Response: We did provide them with the IT equipment that was purchased with ESSER funds, where we failed was in giving them the location and a tag or serial number of each item. We do have this information available and has already been prepared by the IT Department.Corrective Action Plan: The District has educated the IT Department of their duty to document by serial number and keep inventory of all purchases through federal dollars. The Business Manager and IT Supervisor will work closely to ensure that all items stemming from federal dollars have an inventory and tracked through a serial number or District tag, if appropriate.Planned Implementation Date: January 10, 2023Responsible Person: Business Manager, Lake County School District No. 7
FAC accepted this audit on March 26, 2019 — management decision was due September 26, 2019.
FAC accepted this audit on February 14, 2017 — management decision was due August 14, 2017.
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