Transcript Slide 1

L O U I S I A N A S TAT E S U P E R I N T E N D E N T O F E D U C AT I O N J O H N W H I T E
Louisiana Department of Education
Federal Fiscal Monitoring
LASBO Fall Workshop
November 7, 2012
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Federal Fiscal Monitoring Review
Overall Objectives
• Assess internal controls for Federal Programs
• Verify the completeness, accuracy, validity, and allowability of
financial information for budgeted costs claimed and reimbursed on
Federal Programs
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Fiscal Monitoring Selection Process
Subrecipients selected from risk based audit plan

Districts are monitored at least once every five years
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Charters schools are monitored within 3 years of opening
and then at least once every 5 years.

Other entities are monitored as they expend grant funds
and at least every 5 years if applicable

Subrecipients with material findings may be audited
more frequently.
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Scheduling
 Business Official contacted to schedule
fieldwork including
• Dates of fieldwork
• Fiscal year(s) to be monitored
• Federal Programs to be examined
• Documentation required for review
 Confirmation letter with documentation list
mailed to Business Official
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Subrecipient Preparation
Business Official should coordinate plans for
the fiscal monitoring with personnel involved:
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Business office personnel
Federal Program personnel
Human Resource personnel
School personnel
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Required Documentation for
Desk and Field Audits
 Instructional document is provided with
confirmation letter
 Documentation should be available for review
at the beginning of fieldwork or desk audit
 Should be organized (see instructional)
 Contact LDOE staff with any questions about
required documentation
Required Documentation
Audit Review Process Instructional Document
• Cover Page and List of Personnel Contacts
Section A - Policies and Procedures
A-1
Chart of Accounts
A-2
Fixed Asset Policy
A-3
Travel Policy
A-4
Procurement Policy
A-5
Salary Schedule Schedule
Section B – Documents to support reimbursed
costs
Internal Control Fiscal Monitoring Tool
Purpose:
Examine Internal Controls for current fiscal year
• Disseminated yearly to all LEAs
• Results requested during Fiscal Monitoring
ICFMT completed by Business Officials
o Ensure that internal controls are uniformly applied to all
programs
o Use as a guide for future monitoring and to request technical
assistance
Object Codes Examined
• Salaries (Object Code 100) and Related Benefits (Object Code 200)
• Purchased Professional and Technical Services (Object Code 300)
• Purchased Property Services (Object Code 400)
• Other Purchased Services (Object Code 500)
• Supplies (Object Code 600)
• Property (Object Code 700)
• Other Objects (Object Code 800)
• Other Uses of Funds (Object Code 900)
• Indirect Cost
Salaries and Related Benefits
Documentation Required:
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Program Staffing List by federal program
Payroll
OMB A-87 Cost Certifications and/or PARs
Stipend Pay
Substitute Pay
Personnel files for each federal employee.
Program Staffing Lists
Should include:
• Program name & CFDA number
• Employee name and identification number
• Employee position
• Beginning and ending staffing dates
• Work location of employee
Payroll
Should include:
• Program name and fund number
• Employee name and identification number
• Employee position
• Pay and benefits for each period in fiscal year by type
of pay (e.g. regular pay, stipend pay, insurance,
retirement)
• Work location of employee
OMB A-87 Cost Certification Forms
Should include
• Employee name & identification number
• Position and Work location(s)
• Program & CFDA number
• Time period
• Signature of employee and/or supervisor
• Date completed
Required completion period
• Semi-annual or monthly
Stipends and Substitutes
Stipends
• Stipend pay amount
• Sign-in sheets
• Agendas
• Time period
• Workshop, Meeting,
etc.
• Signature of employee
and/or supervisor
• OMB A-87 Statement
Substitutes
• Substitute pay amount
• Sub education level
• Sign-in sheets, logs
• Time period
Personnel Files
Should include
• Employee name and identification number
• Employee position
• Pay rate and benefits for each employee
• Certification & degree level (if applicable)
• Years of service
Do not include evaluations or other personnel actions.
Purchased Professional and Technical Services
Documentation required:
• Purchase requisitions for services
• Purchase order for services
• Contracts for services
• Vendor invoice
• Sign-In sheets
• Subrecipient cancelled check
Contracts may substitute for a purchase order for expenditures
in this Object Code.
Purchased Property Services
Documentation Required:
• Purchase requisitions for property services
• Purchase order for property services
• Contracts for property services
• Vendor invoice
• Subrecipient cancelled check
Contracts may substitute for a purchase order for expenditures
in this Object Code.
Other Purchased Services
Documentation Required:
• Purchase requisitions for other purchased services
• Purchase order for other purchased services
• Subrecipient’s Travel Policy & supporting documentation
for employee travel
• Vendor invoice
• Subrecipient cancelled check
Employee Travel Reimbursement
Follow the Travel Policy that covers the period being audited.
− Board adopted policy
− If no board adopted policy, then follow State of Louisiana
PPM # 49.
− All employee travel costs being reimbursed must have
documentation to substantiate them which may include:
 Travel authorizations, reimbursement forms, agendas, signin sheets, registrations, certificates, receipts, etc.
Supplies
Documentation Required:
• Purchase requisitions for supplies
• Purchase order for supplies
• Vendor invoice
• Subrecipient cancelled check
 Food purchases and employee reimbursements need
documentation for the corresponding activity.
 Late fees, interest service charges, finance charges,
taxes and alcohol are not allowable.
Property
Documentation Required:
• Purchase requisitions for property
• Purchase order for property
• Vendor invoice
• Subrecipient cancelled check
• Fixed asset policy
• Fixed asset list
Fixed Asset List
• Maintained by Business Office (for all programs Federal and
state)
• Updated on a regular basis
• Reconciled to purchases at least once every two years
• Cost should follow most restrictive of Federal, State or LEA
definition of capitalization threshold
− Federal (Code of Federal Regulations)- $5,000.00
− State (LAUGH) - $5,000.00
− LEA (Fixed Asset Policy) – TBD by LEA
Fixed Asset List should include:
• Fixed asset description
• Serial number
• Tag number
• Date purchased
• Acquisition cost
• Location
• Fund that purchased fixed asset
• Disposition date (if applicable)
DESK audit may require photo copies of fixed asset with
appropriate tag, number, etc. shown.
Indirect Cost
 Approved indirect cost rate applied to object codes 100 thru
600.
 Approved and Derived rates maintained in eGMS for
applicable programs.
 Approved indirect cost rate restricted on some programs.
 Not allowed on some federal programs. (e.g. Carl Perkins)
Other Objects
Debt Service and Miscellaneous
Amounts paid for goods and services not otherwise
classified in other object codes
Supporting documentation is the same as if reported in the
previous Object Codes.
Other Uses of Funds
Used to classify transactions that are not properly recorded
as expenditures to the LEA, but require control and reporting
by the school district.
• Supporting documentation is the same as if reported in the
previous Object Codes.
Issues for all Object Codes
 Costs should be charged to Object Codes based
on the revised Louisiana Accounting and
Uniform Governmental Handbook (LAUGH)
 Costs in object codes 300 thru 700 and 800
must be paid before being included on the
Request for Funds.
 Salaries (Object Code 100) and Related Benefits
(Object Code 200) costs may be claimed for
reimbursement 2 weeks in advance.
Issues for all Object Codes
 Quality controls should be instituted at
subrecipient level to ensure accuracy of
reimbursement request
 Project Completion Reports should be completed
and submitted for all closed programs.
 Adjustments, if needed, should be made on
subsequent Requests for Funds based on actual
amounts.
 Adjustments should be clearly identified on
requests
Common Audit Findings
Reporting Errors - Software reporting
340 Purchased Tech Service – software support services
442 Rental of Equipment – leasing or renting equipment
530 Communications – data communication services to
establish or maintain computer-based
communication, networking, and
internet services
615 Supplies – Supplies that are typically used in conjunction with
technology related hardware or software;
downloaded and off the shelf
735 Technology Software – educational software that exceed
capitalization threshold of $5,000
Common Audit Findings
OMB A-87 Time and Effort Certifications
Semi – Annual Cost Certification
Personnel Activity Reports (PARs)
1. Forms are not completed
2. Form completed incorrectly
3. Wrong type of form used
New guidance available to help with these records.
OMB A-87 Cost Certifications:
An Overview
LASBO Fall Workshop
November 7, 2012
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Time Distribution Requirements
Time and effort reporting is important in ensuring that Federal
program funds are used to pay only for the proportionate share
of personnel costs.
If Federal funds are used for salaries -“time and effort records”
must be kept.
• Applies to all employees who are paid with Federal funds
• Must demonstrate that employees paid with Federal funds actually
worked on the specific grant activities
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Time and Effort Records
The type of record an employee must maintain depends on the
number of cost objectives on which an employee works.
The time and effort record must include:
• Employee name & position
• Job title
• Program & CFDA number
• Time period
• Signature of employee and/or supervisor
• Date completed
• When trying to determine which type of cost certification
should be used, the determining factor is the number of cost
objectives on which the employee works, NOT the number of
sources supporting the employee’s salary.
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Single Cost Objective
Semi-Annual Certification
• Employees who work on a single cost objective must certify that
they worked (after-the-fact) solely on the cost objective from
which they were paid for the period covered by the certification.
• Must be signed by the supervisory official having firsthand
knowledge of the work performed by the employee. Employee
signature optional.
• May be prepared for each individual employee or prepared as a
blanket certification (multiple employees working 100% on the
same Federal program for the same supervisory official having
firsthand knowledge of the work performed for these employees).
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Single Cost Objective – New Guidance
A single cost objective is defined as either of the following:
• A function
• An organizational subdivision
• A contract
• A grant
• Any other activity for which cost data are needed and for which
costs are incurred
Therefore, a single cost objective could be a (1) single function,
(2) single grant, or a (3) single activity
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Single Cost Objective – New Guidance
The key to determining whether an employee is working on a
single cost objective is whether the employee’s salary and
wages can be supported in full from each of the Federal awards
on which the employee is working, or from the Federal award
alone if the employee’s salary is also paid with non-Federal
funds.
For the following examples, assume that the uses of funds
described in each example are allowable under the programs
illustrated and there are no supplanting issues, etc.:
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Single Cost Objective – Example 1
An LEA supports a supplemental math teacher to serve lowachieving students with 50% Title I, Part A funds and 50% MFP.
• Teaching math to low-achieving students is a single cost objective
because it can be fully supported under Title I, Part A.
• Even though the employee’s salary is supported by a Federal award
and a non-Federal award, only a semi-annual certification is
required.
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Single Cost Objective – Example 2
A teacher in a Title I school wide school is paid with local funds
to teach first grade in the morning. To decrease the class size for
reading, this same teacher is paid with Title I, Part A funds to
teach a supplemental reading recovery class in the afternoon.
Assumption: This teacher is not needed to provide the basic education program in
the school wide program because the school has a sufficient number of first grade
teachers to meet the requirements of ESEA.
• Even though this teacher’s salary is supported by both local funds
and a Federal award and she/he conducts two different activities,
both of his/her functions are fully supportable by Title I, Part A and
the school wide program constitutes a single cost objective.
• Only a semi-annual certification is required.
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Single Cost Objective – Example 3
A preschool special education teacher is funded 50% with IDEA
B and 50% with IDEA Preschool funds.
• Because teaching preschool special education is an allowable
activity and could be fully supported under both IDEA B and IDEA
Preschool, this teacher is performing a single cost objective.
• Even though this teacher’s salary is supported by two separate
Federal awards, only a semi-annual certification is required.
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Single Cost Objective – Example 4
An LEA supports an elementary school teacher with local funds
but pays him/her with Title I, Part A funds to provide afterschool tutoring for low-achieving students.
• The teacher’s after-school tutoring is a single cost objective and only
a semi-annual certification is required for the time worked in the
after-school program supported by Title I, Part A funds.
• Although this teacher could not be paid with Title I, Part A funds to
provide elementary education, the portion of his/her time spent on
after-school tutoring is easily separated from his/her teaching
position by his/her schedule.
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Multiple Cost Objectives
Monthly Certifications or Personnel Activity Reports (PAR)
• Employees who work on multiple cost objectives must certify
after-the-fact that the distribution of the employee’s salary and
wages reflect the actual activity of the employee.
• This certification must account for the total activity (100%) for
which each employee is compensated, must be prepared at least
monthly, must coincide with one or more pay periods, and must
be signed and dated by the employee.
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Multiple Cost Objectives
Multiple cost objectives include instances of an employee
working on:
• More than one Federal award
• A Federal award and a non-Federal award
• An indirect cost activity and a direct cost activity
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Multiple Cost Objectives
New Guidance on Substitute System
State Educational Agencies (SEAs) are now authorized to approve
one substitute system for allocating salaries and wages to Federal
awards in place of PARs for all LEAs, in accordance with specific
guidelines, as established by the U.S. Department of Education
(USDE) and subject to approval of such system by the cognizant
Federal agency.
• Such system could permit time and effort certification on a semi-
annual basis instead of monthly for some situations.
• Easily implemented if the employee submitting their monthly PARs
have schedules that do not change from week to week.
• The LDE is putting together a focus group and currently looking into
establishing a substitute system.
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Reconcile to Payroll
Semi-annual certifications and Personnel Activity Reports must
be reconciled back to the payroll.
• Semi-annual certifications must be reconciled semi-annually.
• Personnel Activity Reports (PARs) must be reconciled at least
quarterly.
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Questions
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Useful Internet Links-
Louisiana Department of Education (LAUGH)
• http://www.louisianaschools.net/topics/laugh.html
Office of Management & Budget (Circulars)
• http://www.whitehouse.gov/omb/circulars/
U.S. Department of Education (EDGAR)
• http://www.gpoaccess.gov/cfr/index.html
Contact Information
[email protected]
Nakia Jason, Audit Supervisor, LDOE
− Email [email protected]
Marella Houghton, CPA, Audit Manager, LDOE
− Email [email protected]
P.O. Box 94064
1201 N. Third St. Ste. 5-130
Baton Rouge, Louisiana 70804-9064
Telephone: (225) 342-8848
Toll Free: 1-(877)-342-453-2721
Fax: (225) 342-3523