Special Education Fiscal Auditing Roselynn Bittorf SFS Consultant School Financial Services Team WASBO Accounting Conference 2019 Topics Audit Program Overview
Findings and Issues Grant Expenditures Reconciliation Audit Program Overview What are auditors looking for? Why do we care? Special Education Audit Program
Program audit, not fiscal audit Required for all LEAs Audit Program Overview Special Education Audit Program Purposes Verify compliance with licensure and other program requirements
Verify accurate reporting for state aid calculation and federal IDEA Maintenance of Effort Audit Program Overview Program Compliance Requirements 1. No Valid License audit
2. Payroll testing 3. Personal services and employee Audit Program Overview travel Program Compliance Requirements 4. Private vendor contracted
services 5. Specialized transportation 6. Vehicle/equipment purchases Audit Program Overview Staff Must Be Properly Licensed License must be current and valid License must be
appropriate for the individuals actual assignment Audit Program Overview COMPLIANCE REQUIREMNTS 1-4 Staff Must Be Properly Licensed Valid Reporting and License Codes for Special Education/Pupil
Services Staff available at dpi.wi.gov/sfs/aid/special-ed/ sped-sap/eligibility License Checking Responsibility DPI generates NVL list from crosscheck between districts position report and license database - Auditor does not check the license Auditor completes & submits worksheet, attaches district
representation letter (if provided) Audit Program Overview NVL found in SAFR Audit Program Overview NVL/QC Worksheet
Supporting documentation is given to your auditor for submission along with the workbook Audit Program Overview NVL/QC Worksheet Due before audited financial statements Aid payments begin in November, need
worksheets in September Note whether LEA is requesting license status review Reviews are not automatic! Audit Program Overview District Representation Letter Used to correct NVL report when:
1. Position/area incorrect on districts PI-1202 2. License issued after NVL check run in June ISSUE: NVL/QC Reporting 1) Completed NVL/QC worksheet submit actual Excel workbook, not PDF or scan List all Educators Without Valid
Licenses Any additional questioned costs Reflect account coding after any corrections ISSUE: NVL/QC Reporting 2) Confirm whether district agrees or disagrees 3) Supporting documentation as appropriate
ISSUE: NVL/QC Reporting 4) Districts representation letter Copy of license certificatenot DPI website printout Payroll records Other appropriate documentation Specialized Transportation
Pupil transportation in Fund 27, project 011 Did all students have transportation in IEP? Exceptions: Listed in another students IEP (e.g. peer mentor) Incidental Benefit: Picked up at same location, didnt displace another pupil with IEP, didnt increase route
Audit Program Overview cost/capacity Specialized Transportation Students going to/from school also counted for Pupil Transportation Aid? (In the regular transportation report) Questioned cost calculation
specified Audit Program Overview Vehicle/Equipment Purchase Vehicles Prior approval from DPI required Equipment with unit cost at least $10,000 Prior approval from DPI required
Equipment with unit cost less than $10,000 No review Audit Program Overview Reporting Compliance Requirements 1. Match aid-eligible expenditures to 1505-SE
2. Proper coding 3. Report questioned costs Audit Program Overview Ledger vs. PI-1505-SE Compare general ledger to PI1505-SE Trace: Total Fund 27 expenditures Fund 27 project 011 (aid-eligible)
expenditures Audit Program Overview Proper WUFAR Coding No specific procedure beyond auditors usual scope of work Miscoding should be fixed during audit Audit Program Overview
Proper WUFAR Coding Only issue a finding for: Deliberate miscoding to claim state special education aid or federal IDEA funds Deliberate miscoding between Funds 10 & 27 for misstating IDEA MOE Auditors judgment of a
significant, ongoing fiscal Audit Program Overview management issue ISSUES: Proper WUFAR Coding Please review 290 object codes to make sure you are coding as aidable only the eligible 290 objects to project 011
(292,293,295,296 Only) Grant Payment Reconciliation Identifying your grant payments in (GPI) Identifying your grant payments out (GPO) Reported/Expected GPO ISSUES: Grant Payment
Reconciliation 1. Project 340 expenses vs. final IDEA claims 2. GPI/GPO lines on PI-1505-SE 3. GPO = Project 340 w/ certain 380 objects? 4. Other challenges Grant Expenditures Reconciliation
= FINAL IDEA CLAIMS EQUAL ISSUES: Grant Payment Reconciliation 1. Project 340 expenses vs. final IDEA claims 2. GPI/GPO lines on PI-1505-SE
3. GPO = Project 340 w/ certain 380 objects? 4. Other challenges Grant Payment Reconciliation 1. Did you use grant funds to pay another aid eligible entity? 2. Did another aid eligible entity pay you with grant funds?
ISSUES: Grant Payment Reconciliation 1. Project 340 expenses vs. final IDEA claims 2. GPI/GPO lines on PI-1505-SE 3. GPO = Project 340 w/ certain 380 objects? 4. Other challenges Grant Payments Reported v.
Expected GPO = Project 340 w/ certain 380 objects? Object 382 Payments to WI District Object 383 Payments to CCDEB Object 386 Payments to CESA Grant Payments Reported by You v. Others
Need to communicate with other LEA Answer the question who did you pay with grant funds Private tuition is object 370 and not reported here Recap GPO/GPI Process You put your GPI in, You take your GPO out,
You put your Detail in And Reconcile all about. You do a little Checking And find out Who you Paid, And thats what its all About! ISSUES: Grant Payment
Reconciliation 1. Project 340 expenses vs. final IDEA claims 2. GPI/GPO lines on PI-1505-SE 3. GPO = Project 340 w/ certain 380 objects? 4. Other challenges Grant Payments ReconciliationOther Late claims/budget changes
shifting payments to other LEAs on/off the grant Lengthy CESA reconciliations Do checks indicate payment w/ grant funds? Problems Disconnect between grant managers and business offices
Timing: federal (obligations) vs. WUFAR (expenditures) Unclaimed expenses are not Problems Reporting vs. grant timelines Annual reports due mid-September IDEA claims open through September 30
Lump-sum/contract discretionary grants Grants from CESA should be coded w/ project 517 Obligations vs. Expenditures Obligation Order placed, contract awarded, goods/services received, employee work during a given period
Payment required in current or future period General Federal Award Guidance at http://dpi.wi.gov/sms/fedaids Expenditure Recognized when liability is incurred Obligations vs. Expenditures Liquidation
Payment to resolve the liability May not submit grant claim until obligation is liquidated Federal Grant Timeline Grant Period Obliga...
Liquidation Period Expendi... C 7/1
Forward Funding 9/30 Federal Fiscal Year 6/30 9/30
Why Do We Care? s. 115.88 (7), Wis. Stats.: OFFSETTING RECEIPTS. In any school year, the following revenues shall be deducted from costs aidable under this section before aids are calculated under this section: (a) Any federal operational
revenues expended on costs Grant Reconciliation aidable under this section. Why Do We Care? So why cant we just subtract 27R 730 from 27E project 011? Aid-eligible LEAs buy services from each other Differences in recording between LEAs
can result in state aid paid on federallyfunded expenditures Grant Reconciliation Next Steps Revisit communication with grant managers Make sure you know what your SPED/C&I director or CESA is doing!
Write reconciliation into your procedures Written procedures now required for More Information Audit Manual: dpi.wi.gov/sfs /finances/auditors/audit-manual Special Ed/SAP Categorical Aid: dpi.wi.gov/sfs/aid/special-ed
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