Wilsona School DistrictLocal Government

50000 – Reporting (Material Weakness, Material Noncompliance) Federal Agency: U.S. Department of Education Pass-Through Entity: California Department of Education Program Name: COVID-19 ESSER III Fund: Learning Loss, COVID-19 ESSER III Fund, ESSER III State Reserve Emergency Needs, COVID-19 ESSER III State Reserve Learning Loss, COVID-19 American Rescue Plan – Homeless Children and Youth II Federal Financial Assistance Listing: 84.425U and 84.425W Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Non-Compliance Criteria or Specific Requirements Per Title 2, Code of Federal Regulations, Part 200, Subpart D, Section 200.334, records and supporting documents pertinent to a Federal award must be retained for a period of three years from the date of submission of reports to the awarding agency or pass-through entity. Condition The District did not properly prepare its annual report for the Elementary and Secondary School Emergency Relief Fund. Specifically, the District was unable to provide supporting documents that agreed to the full-time equivalent (FTE) information reported to the California Department of Education. Cause It appears that the condition has materialized due to the District not properly entering full-time equivalent (FTE) information into the annual report for the reporting date. Effect The District has not complied with the requirements identified in Title 2, Code of Federal Regulations, Part 200, Subpart D, Section 200.334. Questioned Costs There are no questioned costs associated with the condition identified. Context A single annual report was identified and was selected for testing. The testing resulted in the condition identified above. Repeat Finding Yes. See prior year finding 2023-002. Recommendation The District should ensure that all federal program reports are supported by adequate records. These records should be maintained for a period of three years from the date of submission of the reports to the awarding agency or pass-through entity. Corrective Action Plan and Views of Responsible Officials There was confusion as to what the data point should be used in regarding reporting FTE count within this federal reporting module by past District staff. Clarity has been provided a strategy has been created and professional development has been provided. The annual reporting period is currently now open and correct FTE counts will be corrected for all reporting years.

50000 – Equipment Real Property Management (Material Weakness and Material Non- Compliance) Federal Agency: U.S. Department of Education Pass-Through Entity: California Department of Education Program Name: COVID-19 ESSER III Fund: Learning Loss, COVID-19 ESSER III Fund, ESSER III State Reserve Emergency Needs, COVID-19 ESSER III State Reserve Learning Loss, COVID-19 American Rescue Plan – Homeless Children and Youth II Federal Financial Assistance Listing: 84.425U, 84.425W Compliance Requirement: Equipment Real Property Management Type of Finding: Material Weakness and Material Non-Compliance Criteria or Specific Requirements The Code of Federal Regulations, Title2, Subtitle A, Chapter II, Part 200, Subpart E, Section 200.439(a)(1) states: “Capital expenditures for general purpose equipment, buildings, and land are unallowable as direct charges, except with the prior written approval of the Federal awarding agency or passthrough entity.” Furthermore, the California Department of Education’s (CDE) FAQs on Capital Expenditures state the following: “In accordance with 2 CFR 200.439, prior approval is required for any single big-ticket purchases at the cost of $5,000 or more using the funding sources cited above. These purchases can include general purpose equipment, buildings, and land, including material improvements. This means one costly item (or several items which make up one unit) and the cost includes all the ancillary expenses such as design costs, new electrical circuit for the item, and other related fees. To obtain approval, an LEA must fill out the Capital Expenditures Pre-Approval Application Form.” Condition The District had a total of $193,002 in capital expenditures charged to ESF that was not preapproved by CDE. Cause The cause appears to be attributed to the District’s improper monitoring and lack of knowledge over this specific requirement. Additionally, a contributing factor appears to be a turnover in a key position that provides oversight for this program. Effect As a result of the condition identified, the District was not in compliance with the Code of Federal Regulations, Title 2, Subtitle A, Chapter II, Part 200, Subpart E, Section 200.439(a)(1). Questioned Costs A total of $193,002 in questioned costs were noted based on the condition identified. Context A single transaction was identified and was selected for testing. The testing resulted in the condition identified above. Repeat Finding Yes. See prior year finding 2023-003. Recommendation The District should become familiar with all of the compliance requirements with ESF. As a resource, the District should utilize a combination of guidance provided by CDE and also by Subpart E of the Uniform Guidance that provides guidance on cost principles. Additionally, the District should establish more effective control activities and monitoring over how Federal funds are spent to ensure compliance, moving forward. Corrective Action Plan and Views of Responsible Officials The project was identified in District plans and executed immediately prior to the change in administrative leadership. After review it was noticed that prior capital approval was not obtained prior execution of the project. Applications were subsequently submitted and under review by the CDE at the time of this report preparation. The District acknowledges and has provided professional development with staff, so all are aware of dealing with items that are obtained with federal funds. Pending final answer regarding the prior approval by the CDE will determine the next action of the District.

Federal Agency: U.S. Department of Education Pass-Through Entity: California Department of Education Federal Program: Education Stabilization Fund Assistance Listing Number: 84.425 Compliance Requirement: Reporting Type of Finding: Significant Deficiency and Non-Compliance Criteria or Specific Requirements Per Title 2, Code of Federal Regulations, Part 200, Subpart D, Section 200.334, records and supporting documents pertinent to a Federal award must be retained for a period of three years from the date of submission of reports to the awarding agency or pass-through entity. Condition The District did not properly prepare two annual reports for the Elementary and Secondary School Emergency Relief Fund. The District was unable to provide supporting documentation that agreed to the expenditures reported to the California Department of Education. The District was unable to provide supporting documents that agreed to the fulltime equivalent (FTE) information reported to the California Department of Education. Questioned Costs There are no questioned costs associated with the condition identified. Context The condition was identified through inquiry with District personnel and through review of available supporting documentation. Effect The District has not complied with the requirements identified in Title 2, Code of Federal Regulations, Part 200, Subpart D, Section 200.334. Cause It appears that the condition has materialized due to the District not properly entering program expenditures from their financial system into the quarterly reports for each reporting date. Repeat Finding No. Recommendation The District should ensure that all federal program reports are supported by adequate records. These records should be maintained for a period of three years from the date of submission of the reports to the awarding agency or pass-through entity. Corrective Action Plan and Views of Responsible Officials Moving forward, the District will ensure that all items reported to various agencies, including the California Department of Education, are supported and are retained to external review.

Federal Agency: U.S. Department of Education Pass-through Entity: California Department of Education Federal Program: Education Stabilization Fund (ESF) ALN: 84.425D & 84.425U (FY 2022-2023) Compliance Requirement: Allowable Costs/Cost Principles Type of Finding: Significant Deficiency and Non-Compliance Criteria or Specific Requirements The Code of Federal Regulations, Title 2, Subtitle A, Chapter II, Part 200, Subpart E, Section 200.439(a)(1) states: “Capital expenditures for general purpose equipment, buildings, and land are unallowable as direct charges, except with the prior written approval of the Federal awarding agency or pass- through entity.” Furthermore, the California Department of Education’s (CDE) FAQs on Capital Expenditures state the following: “In accordance with 2 CFR 200.439, prior approval is required for any single big-ticket purchases at the cost of $5,000 or more using the funding sources cited above. These purchases can include general purpose equipment, buildings, and land, including material improvements. This means one costly item (or several items which make up one unit) and the cost includes all the ancillary expenses such as design costs, new electrical circuit for the item, and other related fees. To obtain approval, an LEA must fill out the Capital Expenditures Pre-Approval Application Form” Condition The District had a total of $33,200 in capital expenditures charged to ESF that was not preapproved by CDE. Questioned Costs A total of $33,200 in questioned costs were noted based on the condition identified. Context The condition was identified as a result of our review and testing of expenditures charged to various ESF programs. Effect As a result of the condition identified, the District was not in compliance with the Code of Federal Regulations, Title 2, Subtitle A, Chapter II, Part 200, Subpart E, Section 200.439(a)(1). Cause The cause appears to be attribute to the District’s improper monitoring and lack of knowledge over this specific compliance requirement. Additionally, a contributing factor appears to be a turnover in a key position that provides oversight for this program. Repeat Finding No. Recommendation The District should become familiar with all of the compliance requirements with ESF. As a resource, the District should utilize a combination of guidance provided by CDE and also by Subpart E of the Uniform Guidance that provides guidance on cost principles. Additionally, the District should establish more effective control activities and monitoring over how Federal funds are spent to ensure compliance, moving forward. Corrective Action Plan and Views of Responsible Officials The District will ensure that all proposed capital expenditures originating from any Federal sources that are in excess of $5,000 are pre-approved by CDE prior to executing the proposed transaction.

2021-002 50000 Federal Program Affected Title: Title III, English Learner Student Program CFDA: 84.365 Pass-Through Agency: California Department of Education Federal Agency: U.S. Department of Education Criteria or Specific Requirements Per Title 20, United States Code, Chapter 70, Subchapter III, Part A, Subpart 1, Section 6825(g), Federal funds made available under the Title III, English Learner Student Program are to be used to supplement the level of Federal, State, and local public funds that, in the absence of such availability, would have been expended for programs for limited English proficient children and in no case used to supplant such Federal, State, and local public funds. Condition The California Department of Education (CDE) Federal Program Monitoring Office (FPMO) conducted a Federal Program Monitoring (FPM) audit of Wilsona School District?s Title III, English Learner Student Program for the fiscal year 2020-2021. Based on the audit conducted, Wilsona School District did not have sufficient controls in place to ensure that charges to the program were not supplanting Federal, State, and local public funds. Specifically, the District charged $61,264 to the program for costs that were deemed to supplant Federal, State, and local public funds. Questioned Costs Based on the audit conducted by the FPMO, $61,264 of costs were identified that were deemed to supplant Federal, State, and local public funds. Context The condition was identified as a result of the auditor's review of correspondence from the California Department of Education, dated December 16, 2021, summarizing the result of the audit conducted by FPMO. Effect The District has not complied with the requirements identified in Title 20, United States Code, Chapter 70, Subchapter III, Part A, Subpart 1, Section 6825(g). Cause The condition identified appears to have materialized due to the District's lack of awareness of the requirements under Title 20, United States Code, Chapter 70, Subchapter III, Part A, Subpart 1, Section 6825(g). Recommendation The District should review the requirements stated in Title 20, United States Code, Chapter 70, Subchapter III, Part A, Subpart 1, Section 6825(g) and implement procedures to address the control deficiency.