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Audit (A-09-09-00094)

06-10-2010
Results of Limited Scope Review at Acelero Learning Clark County’s Head Start Program

Executive Summary

We reviewed the financial conditions at Acelero Learning Clark County (Acelero Learning) as part of a nationwide series of reviews requested by the Administration for Children and Families (ACF), Office of Head Start, for use in its overall assessment of Head Start grantees that have applied for additional funding under the American Recovery and Reinvestment Act of 2009 (Recovery Act).

We were unable to determine whether Acelero Learning is a fiscally viable Head Start grantee because only limited audited financial data covering its startup operations for the year ended December 31, 2007, were available at the time of our review. We found that Acelero Learning’s financial management system did not adequately manage and account for Federal funds. Specifically, Acelero Learning’s management affiliation agreement with Acelero Learning, Inc. (Acelero Inc.) was a sole-source agreement and a less-than-arms-length transaction that violated generally accepted sound business practices and created a conflict of interest or the appearance thereof. In addition, Acelero Learning overcharged the Head Start program for Acelero Inc.’s management fees and other costs and undercharged the Extended Day and Food programs for these costs. Acelero Learning also charged the Head Start program for unallowable and unsupported costs. Furthermore, Acelero Learning’s systems and internal controls related to accounting, personnel, procurement, and property management had weaknesses.

We recommended that ACF, in determining whether Acelero Learning should be awarded additional Head Start and Recovery Act grant funding, consider the information presented in this report in assessing Acelero Learning’s financial condition and ability to manage and account for Federal funds. Acelero Learning generally disagreed with our findings.

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