Minnesota Office of the Legislative Auditor
Financial Audit Division

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Report Summary


Management Letter

Department of Education

Fiscal Year Ended June 30, 2003


The Minnesota Department of Education distributes $6 billion in state and federal school aid to Minnesota’s K-12 schools.

Key Findings and Recommendations:

The department made errors in its administration of some federal programs:

  • The department did not provide the $40 million state match it had pledged in its grant agreement with the federal government for charter school assistance. In its response to the report, the department stated that it recently renegotiated the grant agreement and eliminated the match requirement.
  • The department made a $3 million duplicate payment of federal school aids. It offset the duplicate payment against subsequent school aid payments. We recommend that the department establish payment controls to prevent such mistakes.
  • The department did not accurately report child nutrition expenditures to the federal government, which resulted in a net under reimbursement to the state of nearly $300,000. The department is working with the federal government to correct the program expenditure reports and obtain reimbursement.
  • The department miscalculated its federal special education allocations to the schools. It used incorrect rates and student counts to determine the allocations. The department is working with the federal government to resolve the errors without negatively affecting the individual schools.

Management letters address internal control weaknesses and noncompliance issues found during our annual audit of the state’s financial statements and federally funded programs. The scope of our work in individual agencies is limited. During the fiscal year 2003 audit, our scope at the Minnesota Department of Education included state and federal school aid payments.

More Information

Office of the Legislative Auditor ♦ Room 140, 658 Cedar St., St. Paul, MN 55155