HUGHES SPRINGS INDEPENDENT SCHOOL DISTRICT ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED AUGUST 31, 2009_part7 docx

64 Internal Control Over Compliance The administration of Hughes Springs Independent School District is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to federal programs. In planning and performing our audit, we considered the District's internal control over compliance with requirements that could have a direct and material effect on a major federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance, but not for the purpose of expressing an opinion of the effectiveness of internal control over compliance. Accordingly we do not express an opinion on the effectiveness of the District's internal control over compliance. A control deficiency in an entity's internal control over compliance exists when the design or operation of a control does not allow management or employees in the normal course of performing their assigned functions to prevent or detect noncompliance with a type of compliance requirement of a federal program on a timely basis. A significant deficiency is a control deficiency or combination of control deficiencies that adversely affects the entity's ability to administer a federal program such that there is more than a remote likelihood that noncompliance with a type of compliance requirement of a federal program that is more than inconsequential will not be prevented or detected by the entity's internal control. A material weakness is a significant deficiency or a combination of significant deficiencies that results in more than a remote likelihood that material noncompliance with a type of compliance requirement of a federal program will not be prevented or detected by the entity's internal control. Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and would not necessarily identify all deficiencies in internal control that might be significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses as defined above. This report is intended for the information and use of the District's trustees, the audit committee, the administration, Texas Education Agency, federal awarding agencies and pass-through entities and is not intended to be used and should not be used by anyone other than these specified parties. Signature on file at TEA MOORE and CAVER, Inc. Certified Public Accountants October 30, 2009 This is trial version www.adultpdf.com HUGHES SPRINGS INDEPENDENT SCHOOL DISTRICT SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE YEAR ENDED AUGUST 31, 2009 I. Summary of Auditor's Results: 1. Type of auditor’s report issued on the financial statements: Unqualified. 2. No internal control findings required to be reported in this schedule were disclosed in the audit of the financial statements. 3. Noncompliance which is material to the financial statements: None 4. No internal control findings required to be reported in this schedule were disclosed in the audit of the major programs. 5. Type of auditor’s report on compliance for major programs: Unqualified 6. Did the audit disclose findings which are required to be reported under Sec._5I0(a): No 7. Major programs include: CFDA # Program 84.010A ESEA,Title I, Part A 84.357 Reading First 8. Dollar threshold used to distinguish between Type A and Type B Programs: $300,000. 9. Low risk auditee: Yes II. Findings Related to the Financial Statements : 2009-01 Expenditures in Excess of Appropriations Criteria: Budgetary data should reflect materially correct information related to actual events for the current year. Condition Found: Hughes Springs Independent School District had expenditures in excess of appropriation for the functions 13, 34, 36, 53, and 72 in the General Fund between expenditures and final budget . Effect: None. Cause: Administration’s failed to amend the budget as required. III. Findings and Questioned Costs Related to the Federal Awards AA-1: None. 65 This is trial version www.adultpdf.com HUGHES SPRINGS INDEPENDENT SCHOOL DISTRICT SCHEDULE OF STATUS OF PRIOR FINDINGS FOR THE YEAR ENDED AUGUST 31, 2009 PRIOR YEAR'S FINDING/NONCOMPLIANCE 2008-01 Expenditures in Excess of Appropriations The District will monitor and amend the budget before expenditures are made. This has continued in the current year. 2008-2 Failure To Follow Bid Laws The District will advertise for vendors, obtain quotes or bids, or make purchase from an approved vendor. 66 This is trial version www.adultpdf.com 67 HUGHES SPRINGS INDEPENDENT SCHOOL DISTRICT CORRECTIVE ACTION PLAN FOR THE YEAR ENDED AUGUST 31, 2009 CORRECTIVE ACTION: 2009-01 Expenditures in Excess of Appropriations Actions: The District will monitor and amend the budget before expenditures are made. Contact person: Richard Ogden, Superintendent Implementation: Immediately This is trial version www.adultpdf.com EXHIBIT K-1 HUGHES SPRINGS INDEPENDENT SCHOOL DISTRICT SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED AUGUST 31, 2009 (1) Federal Entity Identifying (4) Number CFDA Expenditures Federal Number (3)(2) FEDERAL GRANTOR/ PASS-THROUGH GRANTOR/ PROGRAM or CLUSTER TITLE Pass-Through U.S. DEPARTMENT OF EDUCATION Passed Through State Department of Education 169,082ESEA, Title I, Part A - Improving Basic Programs 84.010A $09610101034903 31,021IDEA-Part B, Formula 84.027 09696001034903 307,190SSA - 21st Century Community Learning Centers 84.287 096950017110026 1,484Title II, PArt D-Enhancing Ed. Through Technology 84.318X 09630001034903 144,908 Reading First 84.357 086455107110030 24,282Unidentified Fund from Trial Balance 84.358B 09696001034903 49,714ESEA, Title II, Part A, Teacher/Principal Training 84.367A 9694501034903 4,603034903 Total Passed Through State Department of Education 732,284$ TOTAL DEPARTMENT OF EDUCATION 732,284 $ CORPORATION FOR NATIONAL COMMUNITY SERVICE Direct Programs 8,999National and Community Service Trust 94.004 $06KSWTX001 Total Direct Programs 8,999 $ TOTAL CORP. FOR NATIONAL COMMUNITY SERVICE 8,999 $ U.S. DEPARTMENT OF AGRICULTURE Passed Through the State Department of Agriculture 100,843 School Breakfast Program* 10.553 $71400901 222,842National School Lunch Program - Cash Assistance* 10.555 71300901 6,218Commodity Supplemental - Non-Cash Assistance 10.565 Total Passed Through the State Department of Agriculture 329,903$ TOTAL DEPARTMENT OF AGRICULTURE 329,903 $ TOTAL EXPENDITURES OF FEDERAL AWARDS 1,071,186 $ *Clustered Programs as required by Compliance Supplement March, 2009 68 This is trial version www.adultpdf.com HUGHES SPRINGS INDEPENDENT SCHOOL DISTRICT NOTES TO THE SCHEDULE OF EXPEDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED AUGUST 31, 2009 1. For all Federal programs, the District uses the fund types specified in Texas Education Agency's Financial Accountability System Resource Guide. Special revenue funds are used to account for resources restricted to, or designated for, specific purposes by a grantor. Federal and state financial assistance generally is accounted for in a Special Revenue Fund. 2. The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. The Governmental Fund types and Expendable Trust Funds are accounted for using a current financial resources measurement focus. All Federal grant funds were accounted for in a Special Revenue Fund, which is a Governmental Fund type. With this measurement focus, only current assets and current liabilities and the fund balance are included on the balance sheet. Operating statements of these funds present increases and decreases in net current assets. The modified accrual basis of accounting is used for the Governmental Fund types, the Expendable Trust Funds, and Agency Funds. This basis of accounting recognizes revenues in the accounting period in which they become susceptible to accrual, i.e., both measurable and available, and expenditures in the accounting period in which the fund liability is incurred, if measurable, except for unmatured interest on General Long-Term Debt, which is recognized when due, and certain compensated absences and claims and judgments, which are recognized when the obligations are expected to be liquidated with expendable available financial resources. Federal grant funds are considered to be earned to the extent of expenditures made under the provisions of the grant, and, accordingly, when such funds are received, they are recorded as deferred revenues until earned. 3. The period of availability for federal grant funds for the purpose of liquidation of outstanding obligations made on or before the ending date of the federal project period extended 30 days beyond the federal project period ending date, in accordance with provisions in Section H, Period of Availability of Federal Funds, Part 3, OMB Circular A-133 Compliance Statement - Provisional 6/97. 69 This is trial version www.adultpdf.com SCHOOLS FIRST QUESTIONNAIRE Hughes Springs Independent School District Fiscal Year 2009 Were there any disclosures in the Annual Financial Report and/or other sources of information concerning default on bonded indebtedness obligations? No SF2 Did the district receive a clean audit? - Was there an unqualified opinion in the Annual Financial Report? Yes SF4 Did the Annual Financial Report disclose any instances of material weaknesses in internal controls? No SF5 Was there any disclosure in the Annual Financial Report of material noncompliance? No SF9 Total accumulated accretion on capital appreciation bonds included in government-wide financial statements at fiscal year end. SF10 This is trial version www.adultpdf.com . version www.adultpdf.com SCHOOLS FIRST QUESTIONNAIRE Hughes Springs Independent School District Fiscal Year 2009 Were there any disclosures in the Annual Financial Report and/or other sources of information. March, 2009 68 This is trial version www.adultpdf.com HUGHES SPRINGS INDEPENDENT SCHOOL DISTRICT NOTES TO THE SCHEDULE OF EXPEDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED AUGUST 31, 2009 . version www.adultpdf.com HUGHES SPRINGS INDEPENDENT SCHOOL DISTRICT SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE YEAR ENDED AUGUST 31, 2009 I. Summary of Auditor's Results: 1. Type of auditor’s report