UNITED STATES DEPARTMENT OF EDUCATION

OFFICE OF THE CHIEF FINANCIAL AND CHIEF INFORMATION OFFICER

February 26, 1998

Dear Sirs and Madam:

Subject: Cooperative Audit Resolution of Closed Audit Findings

This letter represents the final program determinations for 8 of the 14 findings listed in the enclosed Second Supplement to the Matrix of Closed Findings (Matrix) for which the Assistant Secretaries for the Office of Vocational and Adult Education (OVAE), Office of Special Education and Rehabilitative Services (OSERS), and Rehabilitation Services Administration (RSA), Office of the Commissioner, of the U.S. Department of Education (Department) are respectively responsible for resolving. The findings closed by this program determination letter (PDL) and the enclosed Agreements discussed below are in addition to the 80 findings closed by the PDL sent to the Commonwealth of Pennsylvania (PA) on November 7, 1997, and the 25 findings closed by the PDL sent to PA on January 23, 1998. Staff from the Office of Elementary and Secondary Education, OVAE, OSERS and the Office of the Chief Financial and Chief Information Officer, in addition to the Office of Inspector General and the Office of General Counsel, comprise the Department's Cooperative Audit Resolution and Oversight Initiative (CAROI) team. As a result of subsequent conference calls and a site visit, Project Teams from PA and the Department resolved and closed the final 8 findings that are listed in the enclosed Matrix. The proposed resolution of 5 findings related to the Hiram G. Andrews Center is contained in a separate Settlement Agreement (enclosed). The resolution of the PDE maintenance of effort finding for Fiscal Year 1993 is also contained in a separate Agreement (enclosed). These findings were reported in the Single Audit Reports for the following audit years:

CAROI representatives from the PA Departments of "Education," "Health, " "Labor and Industry," and "Public Welfare," the Auditor General, Office of the Budget, and Governor's Policy Office, and the U.S. Department of Education's CAROI representatives verified the accuracy and completeness of the enclosed Matrix with respect to those findings for which they are responsible. For your convenience, we are enclosing, in addition to the enclosed Matrix, a list of the additional 14 findings and a table of those findings by Department program and PA agency, department, or office.

With regard to the issue of liquidation of obligations, pursuant to 34 CFR 80.23 (b), the Assistant Secretaries for Special Education and Rehabilitative Services (OSERS), Elementary and Secondary education (OESE), and Vocational and adult Education (OVAE) extend until September 30, 1998, the period of time within which Pennsylvania Department of education (PDE) may liquidate obligations incurred under fiscal year (FY) 1996 and FY 1997 grant awards made by these Assistant Secretaries. In the PDL issued on January 23, 1998, the Assistant Secretaries for OSERS and OESE also extended the time for liquidation related to obligations addressed in findings 43 and 48 in FY 1995.

We wish to thank you and your staff for the cooperation that has resulted in the resolution of these findings. If you have any questions about the final program determinations for the findings listed in the enclosed Matrix, please contact Ms. Hazel Fiers, CAROI Committee, at (202) 401-1194.

Sincerely yours,

Enclosures

List of Closed Findings

Table of Closed Findings by Program Office/Commonwealth

Second Supplement to Original Matrix of Closed Finding

Settlement Agreement related to the Hiram G. Andrews Center

Agreement Related to the Maintenance of Effort Findings

cc:    Honorable Robert Casey, Auditor General

Mr. Harvey Eckert, Deputy Secretary for Comptroller Operations

Mr. Donald Rappaport, Chief Financial and Chief Information Officer

Dr. Gerald N. Tirozzi, Assistant Secretary for Elementary and Secondary Education

Ms. Jamienne S. Studley, Acting General Counsel

Mr. Steven A. McNamara, Acting Inspector General

CAROI Committee and Team Members

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