Single Audit Report Fiscal Year Ended June 30, 2012 - State ...

State of GeorgiaFederal Awards Findings and Questioned CostsFor the Fiscal Year Ended June 30, 2012Recommendation:The Department of Education should implement additional policies and procedures to ensure thatprocurement activities are in compliance with federal procurement and suspension and debarmentregulations.Finding Control Number: FA-414-12-03REPORTINGInternal Control Deficiencies Regarding Federal Funding Accountability and Transparency ActCareer and Technical Education-Basic Grants to States (CFDA 84.048)Twenty-First Century Community Learning Centers (CFDA 84.287)School Improvement Grants (CFDA 84.377)U.S. Department of EducationGrant Awards: Year 2011 - S287C110010; S377A100011; V048A110010Condition:Our examination included a review of the Department of Education's (Department) compliance withthe Federal Funding Accountability and Transparency Act (FFATA). Under FFATA reportingrequirements, the following grants awarded to the Department as a prime awardee qualified forFFATA subaward reporting:1. Career and Technical Education - Basic Grants to States (CFDA No. 84.048)2. School Improvement Grants (CFDA No. 84.377)3. Twenty-First Century Community Learning Centers (CFDA No. 84.287)Based on the dates the Board of Education (Board) obligated each grant award and approvedallocations to subawardees for each grant, the FFATA subaward report for each grant was late asfollows:1. Career and Technical Education - Basic Grants to States - 177 days late2. School Improvement Grants - 260 days late3. Twenty-First Century Community Learning Centers - 201 days lateIn addition, the Department did not have a process in place to determine whether or not a subawardeewas required to report the names and total compensation of its five (5) most highly compensatedofficers.Criteria:As a result of the FFATA of 2006, the Office of Management and Budget (OMB) requires a primegrant awardee to submit an FFATA report for each applicable Federal grant by the end of the monthfollowing the month a subaward or obligation is made. According to OMB Memorandum for SeniorAccountable Officials dated August 27, 2010, “If applicable, the prime awardee must reportinformation related to a subaward by the end of the month following the month the subaward orobligation was made.” The Department obligates awards when allocations to subawardees areapproved by the Board.The OMB Memorandum for Senior Accountable Officials also states a prime awardee is required toreport the "names and total compensation of the five most highly compensated officers of the entity ifthe entity in the preceding fiscal year received 80 percent or more of its annual gross revenues inFederal awards; and $25,000,000 or more in annual gross revenues from Federal awards; and thepublic does not have access to this information about the compensation of the senior executives of theentity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of1934...or section 6104 of the Internal Revenue Code of 1986."Cause:The deficiencies noted were caused by the Department's failure to establish adequate internal controlsto ensure that the FFATA subaward reports are submitted in a timely manner and to determine whetheror not a subawardee is required to report the names and total compensation of its five (5) most highlycompensated officers.90