Round Valley Unified School DistrictLocal Government

FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the Door/Window Replacement Project did not appear to be pre-approved by the California Department of Education (CDE). This project had a cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $108,697.67 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.

FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the Door/Window Replacement Project did not appear to be pre-approved by the California Department of Education (CDE). This project had a cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $108,697.67 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.

FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the Door/Window Replacement Project did not appear to be pre-approved by the California Department of Education (CDE). This project had a cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $108,697.67 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.

FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the Door/Window Replacement Project did not appear to be pre-approved by the California Department of Education (CDE). This project had a cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $108,697.67 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.

FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the Door/Window Replacement Project did not appear to be pre-approved by the California Department of Education (CDE). This project had a cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $108,697.67 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.

FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the Door/Window Replacement Project did not appear to be pre-approved by the California Department of Education (CDE). This project had a cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $108,697.67 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.

FINDING #2023-001: EDUCATION STABILIZATION FUNDS – EQUIPMENT AND OTHER CAPITAL EXPENDITURES (50000) Program Names: Elementary and Secondary School Emergency Relief III (ESSER III) Fund Assistance Listing Number: 84.425 Pass-Through Agency: California Department of Education (CDE) Federal Agency: U.S. Department of Education Criteria: Consistent with 2 CFR section 200.311 (real property), section 200.313 (equipment), and section 200.439 (equipment and other capital expenditures) ESF funds may be used to purchase equipment. Capital expenditures for general and special purpose equipment purchases are subject to prior approval by ED or the pass-through entity. Condition: Through testing of a representative sample of ESF expenditures, we noted that the Door/Window Replacement Project did not appear to be pre-approved by the California Department of Education (CDE). This project had a cost in excess of $5,000 (including installation and other ancillary costs). Context: The condition was identified through the testing of ESF expenditures. Cause: District oversight. Effect: The funds spent on these purchases may be subject to review by or return to the awarding agency. Questioned Costs: $108,697.67 Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the District obtain prior approval from CDE for all capital expenditure purchases from the Education Stabilization Fund in excess of $5,000. Views of Responsible Officials: See Corrective Action Plan on following page.

FINDING 2022-001: PROCUREMENT POLICY (30000, 50000)Assistance Listing #10.553 & 10.555 ? U.S. Department of Agriculture, California Department of Education,National School Lunch Program, Child Nutrition ClusterCriteria: Non-Federal entities other than States, including those operating Federal programs as subrecipients ofStates, must follow the procurement standards set out at 2 CFR sections 200.319 and 200.320. For small purchasesunder $250,000 the entity must obtain quotations from an adequate number of qualified sources, provided that theprocurements conform to applicable Federal statutes and the procurement requirements identified in 2 CFR part 200.For purchases over $250,000 the entity must obtain sealed bids, provided that the procurements conform toapplicable Federal statutes and the procurement requirements identified in 2 CFR part 200.Condition: The District could not provide an auditable trail to prove that it followed procurement methods for smallpurchases and purchases over $250,000. The procurement steps did not reflect the requirements identified in 2 CFRpart 200.319 and 200.320.Questioned Cost: Unknown.Context: We tested three contracts, two which were under the simplified threshold and one that requiredcompetitive bidding. The three contracts totaled $891,380.Effect: Failure to adopt a clear written policy that conforms to applicable Federal statutes and the procurementrequirements is a lack control over compliance in procurement transactions.Cause: District approved and awarded contracts but could not show that it followed procurement requirement in 2CFR 200.319 and 200.320.Recommendation: We recommend that the District follow procurement requirements identified in 2 CFR part 200when purchasing items with Federal funds.Views of Responsible Officials:The District employed an experienced Director who satisfied all of the CDE requirements, communicated with andworked well with CDE, and who typically followed all requirements. For whatever reason, this Director apparentlydid not follow the procurement requirements for 2021-22. It is possible that the Director thought therequirements were waived due to the pandemic, or possibly followed them but left no discoverable audit trail whenshe left the District in the fall of 2021. The District worked to correct this for the 2022-23 school year.

FINDING 2022-001: PROCUREMENT POLICY (30000, 50000)Assistance Listing #10.553 & 10.555 ? U.S. Department of Agriculture, California Department of Education,National School Lunch Program, Child Nutrition ClusterCriteria: Non-Federal entities other than States, including those operating Federal programs as subrecipients ofStates, must follow the procurement standards set out at 2 CFR sections 200.319 and 200.320. For small purchasesunder $250,000 the entity must obtain quotations from an adequate number of qualified sources, provided that theprocurements conform to applicable Federal statutes and the procurement requirements identified in 2 CFR part 200.For purchases over $250,000 the entity must obtain sealed bids, provided that the procurements conform toapplicable Federal statutes and the procurement requirements identified in 2 CFR part 200.Condition: The District could not provide an auditable trail to prove that it followed procurement methods for smallpurchases and purchases over $250,000. The procurement steps did not reflect the requirements identified in 2 CFRpart 200.319 and 200.320.Questioned Cost: Unknown.Context: We tested three contracts, two which were under the simplified threshold and one that requiredcompetitive bidding. The three contracts totaled $891,380.Effect: Failure to adopt a clear written policy that conforms to applicable Federal statutes and the procurementrequirements is a lack control over compliance in procurement transactions.Cause: District approved and awarded contracts but could not show that it followed procurement requirement in 2CFR 200.319 and 200.320.Recommendation: We recommend that the District follow procurement requirements identified in 2 CFR part 200when purchasing items with Federal funds.Views of Responsible Officials:The District employed an experienced Director who satisfied all of the CDE requirements, communicated with andworked well with CDE, and who typically followed all requirements. For whatever reason, this Director apparentlydid not follow the procurement requirements for 2021-22. It is possible that the Director thought therequirements were waived due to the pandemic, or possibly followed them but left no discoverable audit trail whenshe left the District in the fall of 2021. The District worked to correct this for the 2022-23 school year.

FINDING 2022-001: PROCUREMENT POLICY (30000, 50000)Assistance Listing #10.553 & 10.555 ? U.S. Department of Agriculture, California Department of Education,National School Lunch Program, Child Nutrition ClusterCriteria: Non-Federal entities other than States, including those operating Federal programs as subrecipients ofStates, must follow the procurement standards set out at 2 CFR sections 200.319 and 200.320. For small purchasesunder $250,000 the entity must obtain quotations from an adequate number of qualified sources, provided that theprocurements conform to applicable Federal statutes and the procurement requirements identified in 2 CFR part 200.For purchases over $250,000 the entity must obtain sealed bids, provided that the procurements conform toapplicable Federal statutes and the procurement requirements identified in 2 CFR part 200.Condition: The District could not provide an auditable trail to prove that it followed procurement methods for smallpurchases and purchases over $250,000. The procurement steps did not reflect the requirements identified in 2 CFRpart 200.319 and 200.320.Questioned Cost: Unknown.Context: We tested three contracts, two which were under the simplified threshold and one that requiredcompetitive bidding. The three contracts totaled $891,380.Effect: Failure to adopt a clear written policy that conforms to applicable Federal statutes and the procurementrequirements is a lack control over compliance in procurement transactions.Cause: District approved and awarded contracts but could not show that it followed procurement requirement in 2CFR 200.319 and 200.320.Recommendation: We recommend that the District follow procurement requirements identified in 2 CFR part 200when purchasing items with Federal funds.Views of Responsible Officials:The District employed an experienced Director who satisfied all of the CDE requirements, communicated with andworked well with CDE, and who typically followed all requirements. For whatever reason, this Director apparentlydid not follow the procurement requirements for 2021-22. It is possible that the Director thought therequirements were waived due to the pandemic, or possibly followed them but left no discoverable audit trail whenshe left the District in the fall of 2021. The District worked to correct this for the 2022-23 school year.

FINDING 2022-001: PROCUREMENT POLICY (30000, 50000)Assistance Listing #10.553 & 10.555 ? U.S. Department of Agriculture, California Department of Education,National School Lunch Program, Child Nutrition ClusterCriteria: Non-Federal entities other than States, including those operating Federal programs as subrecipients ofStates, must follow the procurement standards set out at 2 CFR sections 200.319 and 200.320. For small purchasesunder $250,000 the entity must obtain quotations from an adequate number of qualified sources, provided that theprocurements conform to applicable Federal statutes and the procurement requirements identified in 2 CFR part 200.For purchases over $250,000 the entity must obtain sealed bids, provided that the procurements conform toapplicable Federal statutes and the procurement requirements identified in 2 CFR part 200.Condition: The District could not provide an auditable trail to prove that it followed procurement methods for smallpurchases and purchases over $250,000. The procurement steps did not reflect the requirements identified in 2 CFRpart 200.319 and 200.320.Questioned Cost: Unknown.Context: We tested three contracts, two which were under the simplified threshold and one that requiredcompetitive bidding. The three contracts totaled $891,380.Effect: Failure to adopt a clear written policy that conforms to applicable Federal statutes and the procurementrequirements is a lack control over compliance in procurement transactions.Cause: District approved and awarded contracts but could not show that it followed procurement requirement in 2CFR 200.319 and 200.320.Recommendation: We recommend that the District follow procurement requirements identified in 2 CFR part 200when purchasing items with Federal funds.Views of Responsible Officials:The District employed an experienced Director who satisfied all of the CDE requirements, communicated with andworked well with CDE, and who typically followed all requirements. For whatever reason, this Director apparentlydid not follow the procurement requirements for 2021-22. It is possible that the Director thought therequirements were waived due to the pandemic, or possibly followed them but left no discoverable audit trail whenshe left the District in the fall of 2021. The District worked to correct this for the 2022-23 school year.

FINDING 2022-001: PROCUREMENT POLICY (30000, 50000)Assistance Listing #10.553 & 10.555 ? U.S. Department of Agriculture, California Department of Education,National School Lunch Program, Child Nutrition ClusterCriteria: Non-Federal entities other than States, including those operating Federal programs as subrecipients ofStates, must follow the procurement standards set out at 2 CFR sections 200.319 and 200.320. For small purchasesunder $250,000 the entity must obtain quotations from an adequate number of qualified sources, provided that theprocurements conform to applicable Federal statutes and the procurement requirements identified in 2 CFR part 200.For purchases over $250,000 the entity must obtain sealed bids, provided that the procurements conform toapplicable Federal statutes and the procurement requirements identified in 2 CFR part 200.Condition: The District could not provide an auditable trail to prove that it followed procurement methods for smallpurchases and purchases over $250,000. The procurement steps did not reflect the requirements identified in 2 CFRpart 200.319 and 200.320.Questioned Cost: Unknown.Context: We tested three contracts, two which were under the simplified threshold and one that requiredcompetitive bidding. The three contracts totaled $891,380.Effect: Failure to adopt a clear written policy that conforms to applicable Federal statutes and the procurementrequirements is a lack control over compliance in procurement transactions.Cause: District approved and awarded contracts but could not show that it followed procurement requirement in 2CFR 200.319 and 200.320.Recommendation: We recommend that the District follow procurement requirements identified in 2 CFR part 200when purchasing items with Federal funds.Views of Responsible Officials:The District employed an experienced Director who satisfied all of the CDE requirements, communicated with andworked well with CDE, and who typically followed all requirements. For whatever reason, this Director apparentlydid not follow the procurement requirements for 2021-22. It is possible that the Director thought therequirements were waived due to the pandemic, or possibly followed them but left no discoverable audit trail whenshe left the District in the fall of 2021. The District worked to correct this for the 2022-23 school year.

FINDING 2022-001: PROCUREMENT POLICY (30000, 50000)Assistance Listing #10.553 & 10.555 ? U.S. Department of Agriculture, California Department of Education,National School Lunch Program, Child Nutrition ClusterCriteria: Non-Federal entities other than States, including those operating Federal programs as subrecipients ofStates, must follow the procurement standards set out at 2 CFR sections 200.319 and 200.320. For small purchasesunder $250,000 the entity must obtain quotations from an adequate number of qualified sources, provided that theprocurements conform to applicable Federal statutes and the procurement requirements identified in 2 CFR part 200.For purchases over $250,000 the entity must obtain sealed bids, provided that the procurements conform toapplicable Federal statutes and the procurement requirements identified in 2 CFR part 200.Condition: The District could not provide an auditable trail to prove that it followed procurement methods for smallpurchases and purchases over $250,000. The procurement steps did not reflect the requirements identified in 2 CFRpart 200.319 and 200.320.Questioned Cost: Unknown.Context: We tested three contracts, two which were under the simplified threshold and one that requiredcompetitive bidding. The three contracts totaled $891,380.Effect: Failure to adopt a clear written policy that conforms to applicable Federal statutes and the procurementrequirements is a lack control over compliance in procurement transactions.Cause: District approved and awarded contracts but could not show that it followed procurement requirement in 2CFR 200.319 and 200.320.Recommendation: We recommend that the District follow procurement requirements identified in 2 CFR part 200when purchasing items with Federal funds.Views of Responsible Officials:The District employed an experienced Director who satisfied all of the CDE requirements, communicated with andworked well with CDE, and who typically followed all requirements. For whatever reason, this Director apparentlydid not follow the procurement requirements for 2021-22. It is possible that the Director thought therequirements were waived due to the pandemic, or possibly followed them but left no discoverable audit trail whenshe left the District in the fall of 2021. The District worked to correct this for the 2022-23 school year.

FINDING 2022-001: PROCUREMENT POLICY (30000, 50000)Assistance Listing #10.553 & 10.555 ? U.S. Department of Agriculture, California Department of Education,National School Lunch Program, Child Nutrition ClusterCriteria: Non-Federal entities other than States, including those operating Federal programs as subrecipients ofStates, must follow the procurement standards set out at 2 CFR sections 200.319 and 200.320. For small purchasesunder $250,000 the entity must obtain quotations from an adequate number of qualified sources, provided that theprocurements conform to applicable Federal statutes and the procurement requirements identified in 2 CFR part 200.For purchases over $250,000 the entity must obtain sealed bids, provided that the procurements conform toapplicable Federal statutes and the procurement requirements identified in 2 CFR part 200.Condition: The District could not provide an auditable trail to prove that it followed procurement methods for smallpurchases and purchases over $250,000. The procurement steps did not reflect the requirements identified in 2 CFRpart 200.319 and 200.320.Questioned Cost: Unknown.Context: We tested three contracts, two which were under the simplified threshold and one that requiredcompetitive bidding. The three contracts totaled $891,380.Effect: Failure to adopt a clear written policy that conforms to applicable Federal statutes and the procurementrequirements is a lack control over compliance in procurement transactions.Cause: District approved and awarded contracts but could not show that it followed procurement requirement in 2CFR 200.319 and 200.320.Recommendation: We recommend that the District follow procurement requirements identified in 2 CFR part 200when purchasing items with Federal funds.Views of Responsible Officials:The District employed an experienced Director who satisfied all of the CDE requirements, communicated with andworked well with CDE, and who typically followed all requirements. For whatever reason, this Director apparentlydid not follow the procurement requirements for 2021-22. It is possible that the Director thought therequirements were waived due to the pandemic, or possibly followed them but left no discoverable audit trail whenshe left the District in the fall of 2021. The District worked to correct this for the 2022-23 school year.

FINDING #2019-001 ? DIRECT LOAN QUALITY ASSURANCE PLAN Criteria or Specific Requirement 34 CFR 685.300(b)(9) requires schools participating in the Direct Loan program to implement a quality assurance system. Condition We noted that the development of a quality assurance system in compliance with 34 CFR 685.300(b)(9) is currently underway with anticipated completion and implementation during 2019-20. Questioned Costs ? None noted. Context Compliance with 34 CFR 685.300(b)(9) requirements. Effect Non-compliance with 34 CFR 685.300(b)(9), which requires all participating schools to have a written quality assurance system to ensure that the school is complying with program requirements and meeting program objectives. Cause Steps taken in response to requirements under 34 CFR 685.300(b)(9, are largely in place and will be formally documented and implemented in 2019-20. Recommendation The District should continue towards full implementation of its documented response to the Direct Loan quality assurance system in the 2019-20 year. Management's Response and Corrective Action Plan Management agrees with the finding and will ensure that a full written plan in compliance with 34 CFR 685.300(b)(9) is in place during the current 2019-20 fiscal year. While management believes that all requirements under the plan are in place, we concur with the opportunity to formally document each key process.

FINDING #2019-001 ? DIRECT LOAN QUALITY ASSURANCE PLAN Criteria or Specific Requirement 34 CFR 685.300(b)(9) requires schools participating in the Direct Loan program to implement a quality assurance system. Condition We noted that the development of a quality assurance system in compliance with 34 CFR 685.300(b)(9) is currently underway with anticipated completion and implementation during 2019-20. Questioned Costs ? None noted. Context Compliance with 34 CFR 685.300(b)(9) requirements. Effect Non-compliance with 34 CFR 685.300(b)(9), which requires all participating schools to have a written quality assurance system to ensure that the school is complying with program requirements and meeting program objectives. Cause Steps taken in response to requirements under 34 CFR 685.300(b)(9, are largely in place and will be formally documented and implemented in 2019-20. Recommendation The District should continue towards full implementation of its documented response to the Direct Loan quality assurance system in the 2019-20 year. Management's Response and Corrective Action Plan Management agrees with the finding and will ensure that a full written plan in compliance with 34 CFR 685.300(b)(9) is in place during the current 2019-20 fiscal year. While management believes that all requirements under the plan are in place, we concur with the opportunity to formally document each key process.

FINDING #2019-001 ? DIRECT LOAN QUALITY ASSURANCE PLAN Criteria or Specific Requirement 34 CFR 685.300(b)(9) requires schools participating in the Direct Loan program to implement a quality assurance system. Condition We noted that the development of a quality assurance system in compliance with 34 CFR 685.300(b)(9) is currently underway with anticipated completion and implementation during 2019-20. Questioned Costs ? None noted. Context Compliance with 34 CFR 685.300(b)(9) requirements. Effect Non-compliance with 34 CFR 685.300(b)(9), which requires all participating schools to have a written quality assurance system to ensure that the school is complying with program requirements and meeting program objectives. Cause Steps taken in response to requirements under 34 CFR 685.300(b)(9, are largely in place and will be formally documented and implemented in 2019-20. Recommendation The District should continue towards full implementation of its documented response to the Direct Loan quality assurance system in the 2019-20 year. Management's Response and Corrective Action Plan Management agrees with the finding and will ensure that a full written plan in compliance with 34 CFR 685.300(b)(9) is in place during the current 2019-20 fiscal year. While management believes that all requirements under the plan are in place, we concur with the opportunity to formally document each key process.

FINDING #2019-001 ? DIRECT LOAN QUALITY ASSURANCE PLAN Criteria or Specific Requirement 34 CFR 685.300(b)(9) requires schools participating in the Direct Loan program to implement a quality assurance system. Condition We noted that the development of a quality assurance system in compliance with 34 CFR 685.300(b)(9) is currently underway with anticipated completion and implementation during 2019-20. Questioned Costs ? None noted. Context Compliance with 34 CFR 685.300(b)(9) requirements. Effect Non-compliance with 34 CFR 685.300(b)(9), which requires all participating schools to have a written quality assurance system to ensure that the school is complying with program requirements and meeting program objectives. Cause Steps taken in response to requirements under 34 CFR 685.300(b)(9, are largely in place and will be formally documented and implemented in 2019-20. Recommendation The District should continue towards full implementation of its documented response to the Direct Loan quality assurance system in the 2019-20 year. Management's Response and Corrective Action Plan Management agrees with the finding and will ensure that a full written plan in compliance with 34 CFR 685.300(b)(9) is in place during the current 2019-20 fiscal year. While management believes that all requirements under the plan are in place, we concur with the opportunity to formally document each key process.

FINDING #2019-001 ? DIRECT LOAN QUALITY ASSURANCE PLAN Criteria or Specific Requirement 34 CFR 685.300(b)(9) requires schools participating in the Direct Loan program to implement a quality assurance system. Condition We noted that the development of a quality assurance system in compliance with 34 CFR 685.300(b)(9) is currently underway with anticipated completion and implementation during 2019-20. Questioned Costs ? None noted. Context Compliance with 34 CFR 685.300(b)(9) requirements. Effect Non-compliance with 34 CFR 685.300(b)(9), which requires all participating schools to have a written quality assurance system to ensure that the school is complying with program requirements and meeting program objectives. Cause Steps taken in response to requirements under 34 CFR 685.300(b)(9, are largely in place and will be formally documented and implemented in 2019-20. Recommendation The District should continue towards full implementation of its documented response to the Direct Loan quality assurance system in the 2019-20 year. Management's Response and Corrective Action Plan Management agrees with the finding and will ensure that a full written plan in compliance with 34 CFR 685.300(b)(9) is in place during the current 2019-20 fiscal year. While management believes that all requirements under the plan are in place, we concur with the opportunity to formally document each key process.

FINDING #2019-001 ? DIRECT LOAN QUALITY ASSURANCE PLAN Criteria or Specific Requirement 34 CFR 685.300(b)(9) requires schools participating in the Direct Loan program to implement a quality assurance system. Condition We noted that the development of a quality assurance system in compliance with 34 CFR 685.300(b)(9) is currently underway with anticipated completion and implementation during 2019-20. Questioned Costs ? None noted. Context Compliance with 34 CFR 685.300(b)(9) requirements. Effect Non-compliance with 34 CFR 685.300(b)(9), which requires all participating schools to have a written quality assurance system to ensure that the school is complying with program requirements and meeting program objectives. Cause Steps taken in response to requirements under 34 CFR 685.300(b)(9, are largely in place and will be formally documented and implemented in 2019-20. Recommendation The District should continue towards full implementation of its documented response to the Direct Loan quality assurance system in the 2019-20 year. Management's Response and Corrective Action Plan Management agrees with the finding and will ensure that a full written plan in compliance with 34 CFR 685.300(b)(9) is in place during the current 2019-20 fiscal year. While management believes that all requirements under the plan are in place, we concur with the opportunity to formally document each key process.