GREATER ALBANY PUBLIC SCHOOLSLocal Government

Criteria: Only allowable costs may be charged to the Special Education Cluster. Condition: Personnel charged to the program are reviewed periodically and retrospectively to ensure only program related personnel are charged. As part of this review process, payroll transactions for certain personnel were transferred out of the program and to another fund; however, not all of the related benefit expenditures were transferred, resulting in unallowable costs being charged to the program. Context: We noted three individuals whose payroll related benefit charges were erroneously left in the program after transferring the payroll transactions out of the program. Although funds were paid out of the Special Education Cluster for unapproved transactions, the amount was trivial to the program and were subsequently transferred out of the program. Effect: Benefits were being paid out of the Special Education program for personnel not related to the program. Cause: The payroll adjustment utility in the District?s accounting software did not include all related charges when transferring payroll transactions to another fund. The review process involved a review of the payroll distribution reports, which include original allocations of payroll charges, rather than reviewing GL detail of all remaining charges in the program.

FINDING 2019-001- Material Weakness in Internal Controls over Financial Reporting-Repeat Finding from 2018 Criteria: Financial Statements should be presented in conformance with GAAP to allow the auditor to render an unmodified opinion. Condition: With the implementation of GASB 73 and 75, actuarial valuations of other post-employment benefits (OPEB) need to be made. Context: The effect of these potential OPEB liabilities on the Statement of Net Position is unknown. Effect: The District's Net Position may be understated or overstated. Cause: Management has not obtained an actuarial valuation of the post-employment benefit obligation related to either stipends or implicit healthcare subsidy in accordance with GASB 73 and 75. Recommendation: We recommend the District contact a 3rd party actuary to obtain an actuarial valuations of the District's OPEB Liabilities in accordance with GASB 73 and 75.

FINDING 2019-002- Significant Deficiency in Internal Controls over Title 1 requirements Criteria: Time and Effort Requirements Condition: Payroll charges were allocated equitable between federal/nonfederal programs. Context: Although funds were paid out of the Title 1 fund, the amount was well below the materiality total. Effect: Benefits were being paid out of the Title 1 fund even though the person they were tied to was moved to the General fund. This continued on throughout the fiscal year. Cause: When an employee was transferred to a position outside of Title 1, one of her benefits was not transferred with her. It continued to be paid out of the Title l program. Recommendation: Review the payroll records consistently to ensure any errors are caught and corrected.

FINDING 2019-003- Significant Deficiency in Internal Controls over Title 1 requirements Criteria: Time and Effort Requirements Condition: Is there time documentation that conforms to OMB-87 Context: The certification was done, but the paperwork was lost or filled out incorrectly. Effect: Time certification can't be verified for these employees Cause: One employee's certifications were lost during construction work. The other employee did not have a certificate on file for the first period, but had two for the second certification period. Recommendation: Review the attendance list against the qualifying employees to ensure everyone signed off. Scan the certification sheets into the computer to avoid loss of the originals.