FREDONIA-MOCCASIN UNIFIED SCHOOL DISTRICT NO. 6

2024-004 ACTIVITIES ALLOWED OR UNALLOWED AND ALLOWABLE COSTS / COST PRINCIPLES Program: Education Stabilization Fund Federal Assistance Listing Number: 84.425 Federal Agency: U.S. Department of Education Pass-Through Agency: Arizona Department of Education Grantor Number: 21FESSII-111175-01A and 21FESIII-111175-01A Questioned Costs: None Type of Finding: Material weakness in internal controls

Condition/Context: For five of seven journal entries tested for the Education Stabilization Fund program, the District did not have documentation supporting that the entry was reviewed and approved by an individual separate from the preparer.

Criteria: The District’s policies and procedures should ensure that internal controls over compliance of Federal programs are in place and operating effectively.

Cause: Management oversight and turnover in the federal grant department.

Effect: Internal control weakness.

Repeat Finding: No.

Recommendation: We recommend the District to review its internal control procedures over federal programs to ensure that journal entries moving expenditures into the grant program is reviewed and approved by an individual separate from the preparer.

Views of Responsible Officials: The District’s corrective action plan presented in a separate document includes the views and planned corrective action of its responsible officials. We are not required to and have not audited these responses and planned corrective actions and therefore provide no assurances as to their accuracy.

2023-004 ACTIVITIES ALLOWED OR UNALLOWED Program: Education Stabilization Fund – ESSER II and ESSER III Federal Assistance Listing Number: 84.425 Federal Agency: U.S. Department of Education Pass-Through Agency: Arizona Department of Education Grantor Number: 21FESSII-111175-01A and 21FESIII-111175-01A Questioned Costs: $133,105 Type of Finding: Material noncompliance and material weakness in internal control Compliance Requirement: A. Activities Allowed or Unallowed Condition/Context: During our testing of expenditures, it was noted that eleven expenditures with a total of $133,105 were not included within the Education Stabilization Fund budget as approved by the Arizona Department of Education. Criteria: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Additionally, federal awards must be spent in accordance with the budget and grant agreement approved by the awarding agency or pass-through entity. Cause: Management oversight and turnover in the federal grant department. Effect: Noncompliance with Uniform Guidance and internal control weakness. Repeat Finding: No. Recommendation: We recommend the District to review its internal control procedures over federal programs to ensure grant expenditures are approved by the SEA prior to the expenditures being incurred. Views of Responsible Officials: The District’s corrective action plan presented in a separate document includes the views and planned corrective action of its responsible officials. We are not required to and have not audited these responses and planned corrective actions and therefore provide no assurances as to their accuracy. Contact Person: Dorene Mudrow, Superintendent

2023-005 ACTIVITIES ALLOWED OR UNALLOWED AND ALLOWABLE COSTS / COST PRINCIPLES Program: Education Stabilization Fund – ESSER II and ESSER III Federal Assistance Listing Number: 84.425 Federal Agency: U.S. Department of Education Pass-Through Agency: Arizona Department of Education Grantor Number: 21FESSII-111175-01A and 21FESIII-111175-01A Questioned Costs: None Type of Finding: Material weakness in internal controls Compliance Requirement: A. Activities Allowed or Unallowed; B. Allowable Costs / Cost Principles Condition/Context: For one of three payroll related journal entries tested for the Education Stabilization Fund program, the District did not have documentation supporting that the entry was reviewed and approved by an individual separate from the preparer. Criteria: The District’s policies and procedures should ensure that internal controls over compliance of Federal programs are in place and operating effectively. Cause: Management oversight and turnover in the federal grant department. Effect: Internal control weakness. Repeat Finding: No. Recommendation: We recommend the District to review its internal control procedures over federal programs to ensure that journal entries moving expenditures into the grant program is reviewed and approved by an individual separate from the preparer. Views of Responsible Officials: The District’s corrective action plan presented in a separate document includes the views and planned corrective action of its responsible officials. We are not required to and have not audited these responses and planned corrective actions and therefore provide no assurances as to their accuracy. Contact Person: Dorene Mudrow, Superintendent