October 8, 2014

About the Presenter
Manager
Grant Review Unit
Division of Federal Fiscal Monitors
Texas Education Agency
(512) 463-9918
Roger.Hingorani@tea.state.tx.us
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Agenda
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Acronyms Used In Presentation
• CFR – Code of Federal Regulations
• FASRG – Financial Accountability School Resource Guide
• LEA – Local Education Agency
• NCLB – No Child Left Behind
• OMB – Office of Management and Budget
• PAR – Personnel Activity Report
• TEA – Texas Education Agency
• PER-DIEM – Daily Allowance for Expenses
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October 8, 2014
Division of Federal Fiscal Monitoring (FFM)
• Grant Review Unit (GRU)
• Conducts monitoring activities including both desk and onsite reviews as part of TEA’s annual risk assessment and investigations for complaints and/or management referrals of the discretionary and formula grants awarded to school districts, charter schools, regional education service centers and non-profit entities.
• Conducts reviews of annual financial reports for compliance with federal single audit requirements and issues management decisions related to audit findings pertaining to any federal awards passed through the TEA.
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October 8, 2014
Division of Federal Fiscal Monitoring (FFM)
• Monitoring Review Unit (MRU)
• Conducts monitoring activities including desk reviews of LEAs as part of the TEA’s annual risk assessment
• Monitoring for special conditions imposed on discretionary and formula grants awarded to school districts, charter schools, regional education service centers and other entities.
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January 28, 2014
Is Your School District in Compliance with
Grant Requirements?
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Division of Federal Fiscal Monitoring (FFM)
• 55 Desk and Onsite Reviews Conducted
• 41 Reviewed had Findings
• 27 had Findings with Questioned Costs
• $165,348.57 in Total Questioned Cost
• $157,444.14 in Questioned Cost Resolved through
Corrective Actions Taken
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Common Findings -
Financial Management Systems
1. Internal Controls - Effective Control
Lack of Written Policies and Procedures
 Reporting of Expenditures for Reimbursement
 Credit Cards
 Travel
 Employee Reimbursements
 Inventory Controls
 Time and Effort
 Budgetary Controls
 Purchasing
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Common Findings – Payroll
2 . Time and Effort
Not adequately maintained or after-the-fact a.Periodic Certifications
 Prepared in Advance not after the fact
 Not signed by employee or supervisor b. Personnel Activity Report (PAR)
 Did not account for 100% of the time compensated
 Budgeted Hours Reported on PAR
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Common Findings – Payroll
2. Time and Effort continued…
Not adequately maintained or Not after-the-fact c. Substitute Time and Effort Reporting System
 Not approved by TEA
 The employee did not work on a set schedule
 Semi-Annual Certificate not signed by employee and supervisor
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Common Findings – Payroll
3 . Lack of Supporting Documentation
 Signed and Dated Job Descriptions
 Tutoring / Extra-duty Pay
Supplemental Pay Agreement
Time Sheets
 Documentation Demonstrating Highly
Qualified Status
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Common Findings – Payroll
3. Lack of Supporting Documentation continued…
 Amounts Recorded in the Payroll Journals does not match with the payroll costs charged to the grant in the General Ledger
 Payroll costs charged to the incorrect grant period
 Payroll checks issued in midmonth every month prior to services being performed.
 Expenditures claimed for reimbursement not recorded in financial records
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Common Findings
4. Budgets/Amendments



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Common Findings
4. Budgets/Amendments – continued…
 Items Requiring TEA Approval Purchased without Approval(Capital Outlay Items)
 Cost Incurred from Class Object Codes not
Approved in the Program Budget.
 Budget Amendments-25%
Variance/Threshold
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Common Findings
5. Required Set Asides
Amounts not appropriated/Identified in financial records to match amounts reserved for specific activities such as a Districtwide
Parental Involvement or Districtwide
Professional Development Activities as reported on Schedule PS-3101 of Consolidated
Federal Grant Application
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Common Findings – Non-payroll
6. Lack of Source Documentation
 Third Party Documents such as an invoice/billing statement to support expenditure
 Lack of Approval from Authorized Personnel
 Lack of Purchase Order.
 Gift Cards without additional support
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Common Findings – Non-payroll
6. Lack of Source Documentation continued…
 Incomplete Receipts/Invoices
 Credit Card Statements without Backup
Receipts
 Lack of Valid Contracts/Agreements for
Professional/contracted Services
 Proof of Attendance: Registration/Certificate of
Completion
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Common Findings – Non-payroll


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Common Findings – Non-payroll
7. Unallowable costs – continued…
Travel
 Lack of Authorization for Travel
 Full PER-DIEM Claimed without attestation of actual funds expended
 Use of grant funds to attend training/conference unrelated to the
Program.
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Common Findings – Non-payroll
7 . Unallowable costs continued…
Food Costs/Incentives
 Food for Staff Meetings/Development
 Full Meals for Parental Involvement
 Food as Incentives for Student
Participation
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Common Findings – Non-payroll
8. Allocable Costs
Goods / Services at the end of the grant period
- Stockpiling of Supplies
Cost Allocation Plans for:
- Rent/Utilities
- Maintenance and Repair Agreements
- Other Shared Costs
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Common Findings - Other
9. Period of Availability
- Pre-Award Costs Charged to the Grant without
TEA Approval
- Annual Subscriptions/Software Licenses-
Outside of the Grant Period
10.Supplement / Supplant a. Curriculum Management Systems / Software b. State Mandated
– Required Trainings
– Books
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Common Findings - Other
11. Shared Service Agreements
 Lack of shared service agreement with member districts
 Agreement not clear about roles and responsibilities of fiscal agent and member district
 Lack of oversight by Fiscal Agent regarding expenditures of grant funds.
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Common Findings - Other
Shoolwide Program: Consolidation of State, local & Federal
Funds
12. Schoolwide Program out of Compliance
 Lack of Documentation to Demonstrate Needs
Assessments
 School Improvement Plans Missing Key Elements
 Methodology demonstrating the accounting for expenditures from schoolwide pool at each participating campus
 Demonstration of supplement not supplant requirements on schoolwide program
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Common Findings - Other
Shoolwide Program: Consolidation of State, local & Federal
Funds Continued…
12.
School Improvement Plan missing key elements
 Ten Required Components
 Goals, objectives, Targets based on Identified Needs
Assessment (Comprehensive Needs Assessment)
 Listing of specific federal, State and local funds consolidated and amount each fund source contributed to the consolidated pool
 Demonstration of Intent and purpose of each federal program whose funds were consolidated.
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How to Avoid Findings
Strong Internal Controls
• Policies and Procedures (P & Ps)
• Tone at the Top – Adherence to P & Ps and
Compliance Requirements
• Organizational Structure - Identify reporting/supervisory responsibilities as well as assignment of authority and responsibilities
• Provide Adequate Training
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How to Avoid Findings
Compliance with Statutory Requirements
Program Statutes
• Elementary and Secondary Education Act (NCLB)
Regulations
• Uniform Administrative Requirements for Grants and
Cooperative Agreements to State and Local Governments
(34 CFR 80 )
• OMB Circular A-87 (Cost Principles for State, Local, and
Indian Tribal Governments
Guidance
• Non-regulatory Guidance
• Application Guidance
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Useful Website Links
Texas Education Agency
• http://www.tea.state.tx.us/
United States Department of Education
• http://www.ed.gov/index.jhtml
Office of Management and Budget
• http://www.whitehouse.gov/omb/circulars/
Code of Federal Regulations
• http://www.gpoaccess.gov/cfr/index.html
Office of Executive Councils, Chief Financial Officers Council
• https://cfo.gov/COFAR/
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More Useful Links (TEA)
TEA: Substitute System of Time-and-Effort Reporting http://www.tea.state.tx.us/index2.aspx?id=2147510385
TEA: Financial Accountability System Resource Guide http://www.tea.state.tx.us/index2.aspx?id=25769817568&menu_id=645
TEA: Grants http://www.tea.state.tx.us/index2.aspx?id=2147487920&menu_id=951
Grant Management Resources http://www.tea.state.tx.us/index4.aspx?id=8339&menu_id=951
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Centers may reproduce and use copies of the Materials and Related
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Education Service Centers, or Texas charter schools or any entity, whether public or private, educational or non-educational, located outside the state of Texas MUST obtain written approval from TEA and will be required to enter into a license agreement that may involve the payment of a licensing fee or a royalty.
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