Austin Achieve Public Schools, Inc.

Finding 2024‐002: Allowable costs – Significant deficiency in internal control over compliance. Child Nutrition Cluster Criteria: Payroll wages charged to grants should be supported by an offer letter approved by management and/or the board of directors. Condition: During allowable cost testing, 55 employees out of 60 sampled did not have approved offer letters on file. These costs were subsequently charged to the grant. Cause: Internal controls were not in place requiring in the School to document approved offer letters for employees. Effect: The School’s reporting of employee wages was not fully documented in accordance with internal control over compliance. Questioned costs: None. Recommendation: The School should implement internal controls to ensure offer letters approved by management and/or the board of directors are kept on file. Management’s response: See corrective action plan.

Finding #2023-002 – Significant Deficiency. Applicable federal programs: U. S. Department of Agriculture, Passed through Texas Education Agency, Child Nutrition Cluster, Assistance Listing #: 10.553, 10.555, Contract Number: 71402101, 71402201, 71302101, 71302201, Contract Years: 10/01/21 – 9/30/22 and 10/01/22 – 9/30/23. U. S. Department of Education, Passed through Texas Education Agency, Special Education Cluster, Assistance Listing #: 84.027A, 84.173A, 84.173X, Contract Number: H027A210008 H173A210004, H173X210004, Contract Years: 07/08/21 – 9/30/22 and 07/01/22 – 9/30/23. Criteria: Procurement – Nonprofit organizations are required to conduct procurement transactions in a manner providing full and open competition consistent with standards prescribed in Uniform Guidance, Procurement Standards, and the Texas Education Code, Section 12.1053, and conform to federal and state laws and regulations and other contractual requirements. Uniform Guidance and the Texas Education Code require obtaining competitive quotes for purchases over the Micro-purchase Threshold, as defined by the nonprofit organization’s written policy, which is $10,000 for Austin Achieve. Condition and context: During our testing of procurement documents for 25 purchases, we noted that 9 transactions tested in excess of $10,000 were not procured in accordance with Austin Achieve’s local written procurement policies. These purchases were charged to the Texas Education Agency – Foundation School Program. Cause: The formal written procurement policies had not been updated to conform with internal procurement practices. Effect: Failure to follow procurement policies may result in Austin Achieve purchasing goods or services for more than would be necessary if required competitive procurement procedures had been followed. Questioned costs: None. Recommendation: Same as finding #2023-001. Views of responsible officials and planned corrective actions: Management agrees with the finding. See Corrective Action Plan.