TUSTIN UNIFIED SCHOOL DISTRICT

Finding 2020-001: Unallowable Indirect Cost Charges to a Federal Program (50000) Program Identification: Federal Agency: U.S. Department of Treasury Pass-through Entity: California Department of Education (CDE) Program Name: COVID-19: Coronavirus Relief Fund (CFDA 21.019) Criteria: 2 C.F.R. Part 200 subpart E ?200.412-419 sets the standards and terms for indirect charges allowed to be applied to federally funded programs by Federal Agency. However, the criteria are clarified in the publication Coronavirus Relief Fund, Guidance for State, Territorial, Local, and Tribal Governments (Updated September 2, 2020), published by the Treasury. According to this guidance, ?Payments from the Fund are not administered as part of a traditional grant program and the provisions of the Uniform Guidance, 2 C.F.R. Part 200, that are applicable to indirect costs do not apply. Recipients may not apply their indirect costs rates to payments received from the fund.? Condition: During our testing we noted that the District had applied an indirect cost rate of 3.93% which totaled $37,642.83 towards the program. This is the first year of CRF funding so there were no prior year findings. Questioned Costs: $37,642.83 Effect: The District charged unallowable indirect costs to the program. Cause: At the time the District was closing their books, guidance for the Coronavirus Relief Fund was not available. The District applied the Indirect Costs to the federal funds only to find out after closing that indirect costs were an unallowable charge. Recommendation: We recommend that the District transfer the costs of the indirect charges from the Coronavirus Relief Fund. Views of Responsible Officials: In compliance with the updated Federal Uniform Guidance, the District has transferred the funds back to the Coronavirus Relief Fund program resource in 2020-21.

GSA_MIGRATION