Compliance || Bonefish Systems, LLC.

Federal Funds Issue

November 10, 2011 - OASBO eNews

Based on an inquiry from OASBO Member Chris Wright, CFO/Treasurer at Portage Lakes Career Center, OASBO received the following response from the Auditor of State (AOS). We thank Chief Deputy Auditor Bob Hinkle and Marnie Carlisle, AOS Accounting and Auditing Senior Audit Manager for their quick response.

Federal Suspension and Debarment requirements apply to all covered transactions, which include most non-payroll transactions. While some people believe the requirements only apply to transactions greater than $25k, there is actually no dollar threshold.

The Ohio Department of Education (ODE) and AOS discussed this issue when ARRA funds became available as that was the first time many schools used Federal money for non-payroll related expenditures less than $25k. As a result, ODE incorporated the Suspension and Debarment requirements into their presentation at seminars offered by BASA, OSABA and OASB to educate the schools about these requirements.

In the meantime, AOS addressed this issue with their staff in the FACCRs as well as in their Federal FAQ webinar. During the webinar, AOS Staff learned that these requirements apply to all transactions. However, it was also explained (and again clarified in an email to staff) that AOS is only required to test transactions exceeding $25k for compliance purposes. Therefore, while the requirements do apply to nearly all non-payroll transactions, auditors of public school district (AOS or IPAs) are only required to sample those transactions exceeding the $25k threshold and/or any sub-awards made to sub-recipients. Auditors should only be reporting noncompliance, etc. with transactions exceeding these amounts. However AOS staff has been directed to make sure schools are aware that the requirements apply to most non-payroll transactions regardless of amount. While auditors may not be looking at those transactions during the single audit, other regulatory agencies (i.e., USDA, USDE, ODE, etc.) might.

Thanks, Chris, for bringing this to our attention!

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