Payroll Distribution Criteria – The Uniform Guidance, Part 200.430(i), states “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed.” These records must, “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Also, “Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: The system for establishing the estimates produces reasonable approximations of the activity actually performed; significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the long term; and the non-Federal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition – The Department uses budget estimates to establish interim rates to allocate payroll costs to be used for Department budgeting and to provide employees with an estimate of time which is expected of them for their assigned programs. The Department has informed employees they are to report the actual time worked on each program code associated with a specific Federal, non-Federal, indirect or cost allocation program. After the January 20, 2022 pay period, a corrective disbursement entry was not prepared in the state accounting system to adjust the estimated time by program to the actual time as reported in the time reporting system. Cause – The Department transitioned to a new payroll and time tracking system. A feature of the system was to allow for time entries to directly charge the respective grant or functions within the accounting ledger. This feature was not implemented into the payroll and time tracking system, as a result the Department established policies and procedures to require actual hours worked on program codes be assigned to their respective program codes in the state accounting system. Corrective disbursement entries were not performed for part of the fiscal year. Effect – Payroll costs could be charged to the incorrect program code resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should review time reporting for the pay periods beginning after January 20, 2022, to the end of the fiscal year and determine if corrective disbursement entries are needed for all programs, including the federal programs. In addition, the Department should implement policies and procedures to ensure proper distribution of salary and wages. Response and Corrective Action Planned – The Department has implemented a payroll policy and procedure, that requires staff to enter a work reporting code for time worked and addresses timelines in which correcting entries must be completed. The Department will review all pay periods during the time frame to determine if corrective disbursement entries need to be made to properly allocate actual time reported to their respective program codes. The Department will begin the process in October 2023. Conclusion – Response accepted.
Payroll Distribution Criteria – The Uniform Guidance, Part 200.430(i), states “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed.” These records must, “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Also, “Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: The system for establishing the estimates produces reasonable approximations of the activity actually performed; significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the long term; and the non-Federal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition – The Department uses budget estimates to establish interim rates to allocate payroll costs to be used for Department budgeting and to provide employees with an estimate of time which is expected of them for their assigned programs. The Department has informed employees they are to report the actual time worked on each program code associated with a specific Federal, non-Federal, indirect or cost allocation program. After the January 20, 2022 pay period, a corrective disbursement entry was not prepared in the state accounting system to adjust the estimated time by program to the actual time as reported in the time reporting system. Cause – The Department transitioned to a new payroll and time tracking system. A feature of the system was to allow for time entries to directly charge the respective grant or functions within the accounting ledger. This feature was not implemented into the payroll and time tracking system, as a result the Department established policies and procedures to require actual hours worked on program codes be assigned to their respective program codes in the state accounting system. Corrective disbursement entries were not performed for part of the fiscal year. Effect – Payroll costs could be charged to the incorrect program code resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should review time reporting for the pay periods beginning after January 20, 2022, to the end of the fiscal year and determine if corrective disbursement entries are needed for all programs, including the federal programs. In addition, the Department should implement policies and procedures to ensure proper distribution of salary and wages. Response and Corrective Action Planned – The Department has implemented a payroll policy and procedure, that requires staff to enter a work reporting code for time worked and addresses timelines in which correcting entries must be completed. The Department will review all pay periods during the time frame to determine if corrective disbursement entries need to be made to properly allocate actual time reported to their respective program codes. The Department will begin the process in October 2023. Conclusion – Response accepted.
Payroll Distribution Criteria – The Uniform Guidance, Part 200.430(i), states “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed.” These records must, “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Also, “Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: The system for establishing the estimates produces reasonable approximations of the activity actually performed; significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the long term; and the non-Federal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition – The Department uses budget estimates to establish interim rates to allocate payroll costs to be used for Department budgeting and to provide employees with an estimate of time which is expected of them for their assigned programs. The Department has informed employees they are to report the actual time worked on each program code associated with a specific Federal, non-Federal, indirect or cost allocation program. After the January 20, 2022 pay period, a corrective disbursement entry was not prepared in the state accounting system to adjust the estimated time by program to the actual time as reported in the time reporting system. Cause – The Department transitioned to a new payroll and time tracking system. A feature of the system was to allow for time entries to directly charge the respective grant or functions within the accounting ledger. This feature was not implemented into the payroll and time tracking system, as a result the Department established policies and procedures to require actual hours worked on program codes be assigned to their respective program codes in the state accounting system. Corrective disbursement entries were not performed for part of the fiscal year. Effect – Payroll costs could be charged to the incorrect program code resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should review time reporting for the pay periods beginning after January 20, 2022, to the end of the fiscal year and determine if corrective disbursement entries are needed for all programs, including the federal programs. In addition, the Department should implement policies and procedures to ensure proper distribution of salary and wages. Response and Corrective Action Planned – The Department has implemented a payroll policy and procedure, that requires staff to enter a work reporting code for time worked and addresses timelines in which correcting entries must be completed. The Department will review all pay periods during the time frame to determine if corrective disbursement entries need to be made to properly allocate actual time reported to their respective program codes. The Department will begin the process in October 2023. Conclusion – Response accepted.
Payroll Distribution Criteria – The Uniform Guidance, Part 200.430(i), states “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed.” These records must, “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Also, “Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: The system for establishing the estimates produces reasonable approximations of the activity actually performed; significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the long term; and the non-Federal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition – The Department uses budget estimates to establish interim rates to allocate payroll costs to be used for Department budgeting and to provide employees with an estimate of time which is expected of them for their assigned programs. The Department has informed employees they are to report the actual time worked on each program code associated with a specific Federal, non-Federal, indirect or cost allocation program. After the January 20, 2022 pay period, a corrective disbursement entry was not prepared in the state accounting system to adjust the estimated time by program to the actual time as reported in the time reporting system. Cause – The Department transitioned to a new payroll and time tracking system. A feature of the system was to allow for time entries to directly charge the respective grant or functions within the accounting ledger. This feature was not implemented into the payroll and time tracking system, as a result the Department established policies and procedures to require actual hours worked on program codes be assigned to their respective program codes in the state accounting system. Corrective disbursement entries were not performed for part of the fiscal year. Effect – Payroll costs could be charged to the incorrect program code resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should review time reporting for the pay periods beginning after January 20, 2022, to the end of the fiscal year and determine if corrective disbursement entries are needed for all programs, including the federal programs. In addition, the Department should implement policies and procedures to ensure proper distribution of salary and wages. Response and Corrective Action Planned – The Department has implemented a payroll policy and procedure, that requires staff to enter a work reporting code for time worked and addresses timelines in which correcting entries must be completed. The Department will review all pay periods during the time frame to determine if corrective disbursement entries need to be made to properly allocate actual time reported to their respective program codes. The Department will begin the process in October 2023. Conclusion – Response accepted.
Payroll Distribution Criteria – The Uniform Guidance, Part 200.430(i), states “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed.” These records must, “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Also, “Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: The system for establishing the estimates produces reasonable approximations of the activity actually performed; significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the long term; and the non-Federal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition – The Department uses budget estimates to establish interim rates to allocate payroll costs to be used for Department budgeting and to provide employees with an estimate of time which is expected of them for their assigned programs. The Department has informed employees they are to report the actual time worked on each program code associated with a specific Federal, non-Federal, indirect or cost allocation program. After the January 20, 2022 pay period, a corrective disbursement entry was not prepared in the state accounting system to adjust the estimated time by program to the actual time as reported in the time reporting system. Cause – The Department transitioned to a new payroll and time tracking system. A feature of the system was to allow for time entries to directly charge the respective grant or functions within the accounting ledger. This feature was not implemented into the payroll and time tracking system, as a result the Department established policies and procedures to require actual hours worked on program codes be assigned to their respective program codes in the state accounting system. Corrective disbursement entries were not performed for part of the fiscal year. Effect – Payroll costs could be charged to the incorrect program code resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should review time reporting for the pay periods beginning after January 20, 2022, to the end of the fiscal year and determine if corrective disbursement entries are needed for all programs, including the federal programs. In addition, the Department should implement policies and procedures to ensure proper distribution of salary and wages. Response and Corrective Action Planned – The Department has implemented a payroll policy and procedure, that requires staff to enter a work reporting code for time worked and addresses timelines in which correcting entries must be completed. The Department will review all pay periods during the time frame to determine if corrective disbursement entries need to be made to properly allocate actual time reported to their respective program codes. The Department will begin the process in October 2023. Conclusion – Response accepted.
Allocable Costs Criteria – The Uniform Guidance, Part 200.405(a), states “A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. This standard is met if the cost: is incurred specifically for the Federal award; benefits both the Federal award and other work of the non-Federal entity and can be distributed in proportions that may be approximated using reasonable methods; and is necessary to the overall operation of the non-Federal entity and is assignable in part to the Federal award in accordance with the principles in this subpart.” Uniform Guidance, Part 200.405(a) states, “Direct cost allocation principles: If a cost benefits two or more projects or activities in proportions that can be determined without undue effort or cost, the cost should be allocated to the projects based on the proportional benefit. If a cost benefits two or more projects or activities in proportions that cannot be determined because of the interrelationship of the work involved, then the costs may be allocated or transferred to benefitted projects on any reasonable documented basis.” Condition – The Department has established program codes to allocate costs to both Federal and non-Federal programs. The allocation of the expenditures charged to these program codes is based on a combination of square footage and actual time reported on Federal and non-Federal programs. Department policies require rates to be updated quarterly. The rates were not updated quarterly after December 14, 2021, for the fiscal year ending June 30, 2022. Cause – The Department transitioned to a new payroll system and policies and procedures to identify time reporting requirements for staff and report capabilities were not in place to properly allocate costs. Effect – Allocable costs could be charged to the incorrect program code, resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should establish policies and procedures to properly allocate costs. In addition, the Department should review the allocable rates used during the period and determine if corrective disbursement entries are needed for all programs, including federal programs. Response and Corrective Action Planned – The Department will review allocable rates during the time frame to determine if corrective disbursement entries are need to their respective program codes. The Department will begin the process in October 2023. The Department will also revise, and update policies and procedures related to allocable costs based on time entries. Conclusion – Response accepted.
Allocable Costs Criteria – The Uniform Guidance, Part 200.405(a), states “A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. This standard is met if the cost: is incurred specifically for the Federal award; benefits both the Federal award and other work of the non-Federal entity and can be distributed in proportions that may be approximated using reasonable methods; and is necessary to the overall operation of the non-Federal entity and is assignable in part to the Federal award in accordance with the principles in this subpart.” Uniform Guidance, Part 200.405(a) states, “Direct cost allocation principles: If a cost benefits two or more projects or activities in proportions that can be determined without undue effort or cost, the cost should be allocated to the projects based on the proportional benefit. If a cost benefits two or more projects or activities in proportions that cannot be determined because of the interrelationship of the work involved, then the costs may be allocated or transferred to benefitted projects on any reasonable documented basis.” Condition – The Department has established program codes to allocate costs to both Federal and non-Federal programs. The allocation of the expenditures charged to these program codes is based on a combination of square footage and actual time reported on Federal and non-Federal programs. Department policies require rates to be updated quarterly. The rates were not updated quarterly after December 14, 2021, for the fiscal year ending June 30, 2022. Cause – The Department transitioned to a new payroll system and policies and procedures to identify time reporting requirements for staff and report capabilities were not in place to properly allocate costs. Effect – Allocable costs could be charged to the incorrect program code, resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should establish policies and procedures to properly allocate costs. In addition, the Department should review the allocable rates used during the period and determine if corrective disbursement entries are needed for all programs, including federal programs. Response and Corrective Action Planned – The Department will review allocable rates during the time frame to determine if corrective disbursement entries are need to their respective program codes. The Department will begin the process in October 2023. The Department will also revise, and update policies and procedures related to allocable costs based on time entries. Conclusion – Response accepted.
Allocable Costs Criteria – The Uniform Guidance, Part 200.405(a), states “A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. This standard is met if the cost: is incurred specifically for the Federal award; benefits both the Federal award and other work of the non-Federal entity and can be distributed in proportions that may be approximated using reasonable methods; and is necessary to the overall operation of the non-Federal entity and is assignable in part to the Federal award in accordance with the principles in this subpart.” Uniform Guidance, Part 200.405(a) states, “Direct cost allocation principles: If a cost benefits two or more projects or activities in proportions that can be determined without undue effort or cost, the cost should be allocated to the projects based on the proportional benefit. If a cost benefits two or more projects or activities in proportions that cannot be determined because of the interrelationship of the work involved, then the costs may be allocated or transferred to benefitted projects on any reasonable documented basis.” Condition – The Department has established program codes to allocate costs to both Federal and non-Federal programs. The allocation of the expenditures charged to these program codes is based on a combination of square footage and actual time reported on Federal and non-Federal programs. Department policies require rates to be updated quarterly. The rates were not updated quarterly after December 14, 2021, for the fiscal year ending June 30, 2022. Cause – The Department transitioned to a new payroll system and policies and procedures to identify time reporting requirements for staff and report capabilities were not in place to properly allocate costs. Effect – Allocable costs could be charged to the incorrect program code, resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should establish policies and procedures to properly allocate costs. In addition, the Department should review the allocable rates used during the period and determine if corrective disbursement entries are needed for all programs, including federal programs. Response and Corrective Action Planned – The Department will review allocable rates during the time frame to determine if corrective disbursement entries are need to their respective program codes. The Department will begin the process in October 2023. The Department will also revise, and update policies and procedures related to allocable costs based on time entries. Conclusion – Response accepted.
Allocable Costs Criteria – The Uniform Guidance, Part 200.405(a), states “A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. This standard is met if the cost: is incurred specifically for the Federal award; benefits both the Federal award and other work of the non-Federal entity and can be distributed in proportions that may be approximated using reasonable methods; and is necessary to the overall operation of the non-Federal entity and is assignable in part to the Federal award in accordance with the principles in this subpart.” Uniform Guidance, Part 200.405(a) states, “Direct cost allocation principles: If a cost benefits two or more projects or activities in proportions that can be determined without undue effort or cost, the cost should be allocated to the projects based on the proportional benefit. If a cost benefits two or more projects or activities in proportions that cannot be determined because of the interrelationship of the work involved, then the costs may be allocated or transferred to benefitted projects on any reasonable documented basis.” Condition – The Department has established program codes to allocate costs to both Federal and non-Federal programs. The allocation of the expenditures charged to these program codes is based on a combination of square footage and actual time reported on Federal and non-Federal programs. Department policies require rates to be updated quarterly. The rates were not updated quarterly after December 14, 2021, for the fiscal year ending June 30, 2022. Cause – The Department transitioned to a new payroll system and policies and procedures to identify time reporting requirements for staff and report capabilities were not in place to properly allocate costs. Effect – Allocable costs could be charged to the incorrect program code, resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should establish policies and procedures to properly allocate costs. In addition, the Department should review the allocable rates used during the period and determine if corrective disbursement entries are needed for all programs, including federal programs. Response and Corrective Action Planned – The Department will review allocable rates during the time frame to determine if corrective disbursement entries are need to their respective program codes. The Department will begin the process in October 2023. The Department will also revise, and update policies and procedures related to allocable costs based on time entries. Conclusion – Response accepted.
Allocable Costs Criteria – The Uniform Guidance, Part 200.405(a), states “A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. This standard is met if the cost: is incurred specifically for the Federal award; benefits both the Federal award and other work of the non-Federal entity and can be distributed in proportions that may be approximated using reasonable methods; and is necessary to the overall operation of the non-Federal entity and is assignable in part to the Federal award in accordance with the principles in this subpart.” Uniform Guidance, Part 200.405(a) states, “Direct cost allocation principles: If a cost benefits two or more projects or activities in proportions that can be determined without undue effort or cost, the cost should be allocated to the projects based on the proportional benefit. If a cost benefits two or more projects or activities in proportions that cannot be determined because of the interrelationship of the work involved, then the costs may be allocated or transferred to benefitted projects on any reasonable documented basis.” Condition – The Department has established program codes to allocate costs to both Federal and non-Federal programs. The allocation of the expenditures charged to these program codes is based on a combination of square footage and actual time reported on Federal and non-Federal programs. Department policies require rates to be updated quarterly. The rates were not updated quarterly after December 14, 2021, for the fiscal year ending June 30, 2022. Cause – The Department transitioned to a new payroll system and policies and procedures to identify time reporting requirements for staff and report capabilities were not in place to properly allocate costs. Effect – Allocable costs could be charged to the incorrect program code, resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should establish policies and procedures to properly allocate costs. In addition, the Department should review the allocable rates used during the period and determine if corrective disbursement entries are needed for all programs, including federal programs. Response and Corrective Action Planned – The Department will review allocable rates during the time frame to determine if corrective disbursement entries are need to their respective program codes. The Department will begin the process in October 2023. The Department will also revise, and update policies and procedures related to allocable costs based on time entries. Conclusion – Response accepted.
IRS 940 Match Criteria – Uniform Guidance Compliance Supplement states, “States are required to annually certify for each taxpayer the total amount of contributions required to be paid under state law for the calendar year and the amounts and dates of such payments in order for the taxpayer to be allowed the credit against the FUTA (Federal Unemployment Tax Act) tax (26 CFR sections 31.3302(a)-3(a)). In order to accomplish this certification, states annually perform a match of employer tax payments with credit claimed for these payments on the employer’s IRS 940 FUTA tax form.” The Internal Revenue Service (IRS) sends the Department a secure file typically in October of each year following the prior calendar year. Taxes received for calendar year ending December 31, 2020, were received in October 2021. IWD must certify and respond to each Federal Employer Identification Number even if there is no discrepancy. The Department is also required to send back to the IRS the Federal Non-Filers file. This file lists all employers that filed with the state but did not file an IRS 940 FUTA tax form. Both the Certification file and the Non-Filers file must be sent back to the Internal Revenue Service by January 31, 2022. The Certification file is used to assign discrepancies to field auditors to determine the disposition of the discrepancy identified. The Department’s policy is designed to review each individual case within 180 days. Condition – The Department did not submit the Certification file by January 31, 2022. In addition, fourteen of fifty-four discrepancies were not resolved at the time of testing and thirty-three of fifty-four were not resolved until after 180 days. Cause – Due to a massive influx of claims beginning March of 2020 through December 2021, staff members from all bureaus, including investigations and field audit, were directed to assist with pandemic related claims. This included claims processing, answering phone calls on the customer service line and conducting two party fact-findings, and assisting in completing employer registrations. Because investigations staff were required to work these areas, normal investigations work, including monitoring the IRS 940 match report, was delayed. As a result, Iowa did not input the 2021 IRS 940 file into its system, so a match was not run, and workflows were not generated in order to create and send a certification file. Effect – The Department did not send the certification file by January 31, 2022, as required. In addition, discrepancies were not resolved in a timely manner. Recommendation – The Department should develop policies and procedures to ensure compliance with the IRS 940 match requirement and certify the amounts contributed annually by January 31. In addition, the Department should follow the established policies and procedures to ensure discrepancies are followed up within 180 days. Response and Corrective Action Planned – The Department will follow policies and procedures in place for fiscal year 2023, to certify the amounts contributed annually and ensure discrepancies are followed up within 180 days. Conclusion – Response accepted.
IRS 940 Match Criteria – Uniform Guidance Compliance Supplement states, “States are required to annually certify for each taxpayer the total amount of contributions required to be paid under state law for the calendar year and the amounts and dates of such payments in order for the taxpayer to be allowed the credit against the FUTA (Federal Unemployment Tax Act) tax (26 CFR sections 31.3302(a)-3(a)). In order to accomplish this certification, states annually perform a match of employer tax payments with credit claimed for these payments on the employer’s IRS 940 FUTA tax form.” The Internal Revenue Service (IRS) sends the Department a secure file typically in October of each year following the prior calendar year. Taxes received for calendar year ending December 31, 2020, were received in October 2021. IWD must certify and respond to each Federal Employer Identification Number even if there is no discrepancy. The Department is also required to send back to the IRS the Federal Non-Filers file. This file lists all employers that filed with the state but did not file an IRS 940 FUTA tax form. Both the Certification file and the Non-Filers file must be sent back to the Internal Revenue Service by January 31, 2022. The Certification file is used to assign discrepancies to field auditors to determine the disposition of the discrepancy identified. The Department’s policy is designed to review each individual case within 180 days. Condition – The Department did not submit the Certification file by January 31, 2022. In addition, fourteen of fifty-four discrepancies were not resolved at the time of testing and thirty-three of fifty-four were not resolved until after 180 days. Cause – Due to a massive influx of claims beginning March of 2020 through December 2021, staff members from all bureaus, including investigations and field audit, were directed to assist with pandemic related claims. This included claims processing, answering phone calls on the customer service line and conducting two party fact-findings, and assisting in completing employer registrations. Because investigations staff were required to work these areas, normal investigations work, including monitoring the IRS 940 match report, was delayed. As a result, Iowa did not input the 2021 IRS 940 file into its system, so a match was not run, and workflows were not generated in order to create and send a certification file. Effect – The Department did not send the certification file by January 31, 2022, as required. In addition, discrepancies were not resolved in a timely manner. Recommendation – The Department should develop policies and procedures to ensure compliance with the IRS 940 match requirement and certify the amounts contributed annually by January 31. In addition, the Department should follow the established policies and procedures to ensure discrepancies are followed up within 180 days. Response and Corrective Action Planned – The Department will follow policies and procedures in place for fiscal year 2023, to certify the amounts contributed annually and ensure discrepancies are followed up within 180 days. Conclusion – Response accepted.
Cash Management Improvement Act Criteria – Effective cash management procedures provide for minimizing the amount of time between the drawdown/request for federal funds and the disbursement of those funds by the Department. Effective cash management also minimizes the amount of state and other federal funds used to supplant programs until federal funds are received. Generally, a maximum of three days is considered acceptable between the receipt of federal funds and the disbursement of those funds. Condition – A review of the Department’s records identified cash balances averaged approximately $28.5 million and were greater than a significant amount of approximately $9.5 million for the fiscal year. Cause – Although procedures have been established to draw federal funds only in amounts sufficient to cover current needs, the Department did not review or update procedures to account for federal draws associated with pandemic related administrative programs and unemployment benefits. Effect – Failure to follow procedures resulted in Department employees not detecting the error in the normal course of performing their assigned duties. Recommendation – The Department should follow established procedures to ensure federal funds are drawn only in amounts sufficient to cover current needs and are disbursed in a timely manner without carrying excessive daily balances. Response and Corrective Action Planned – The Department implemented a revised cash management policy for federal programs. Included in the policy and procedure are reviews of ledger activity, instances in which federal programs reflect excess cash on hand and immediate review of the programs revenues and expenditures is performed. In addition, federal funds drawn that exceed defined thresholds require additional approval from the Accounting and Finance Bureau Chiefs and or the Department’s Chief Financial Officer. Conclusion – Response accepted.
Cash Management Improvement Act Criteria – Effective cash management procedures provide for minimizing the amount of time between the drawdown/request for federal funds and the disbursement of those funds by the Department. Effective cash management also minimizes the amount of state and other federal funds used to supplant programs until federal funds are received. Generally, a maximum of three days is considered acceptable between the receipt of federal funds and the disbursement of those funds. Condition – A review of the Department’s records identified cash balances averaged approximately $28.5 million and were greater than a significant amount of approximately $9.5 million for the fiscal year. Cause – Although procedures have been established to draw federal funds only in amounts sufficient to cover current needs, the Department did not review or update procedures to account for federal draws associated with pandemic related administrative programs and unemployment benefits. Effect – Failure to follow procedures resulted in Department employees not detecting the error in the normal course of performing their assigned duties. Recommendation – The Department should follow established procedures to ensure federal funds are drawn only in amounts sufficient to cover current needs and are disbursed in a timely manner without carrying excessive daily balances. Response and Corrective Action Planned – The Department implemented a revised cash management policy for federal programs. Included in the policy and procedure are reviews of ledger activity, instances in which federal programs reflect excess cash on hand and immediate review of the programs revenues and expenditures is performed. In addition, federal funds drawn that exceed defined thresholds require additional approval from the Accounting and Finance Bureau Chiefs and or the Department’s Chief Financial Officer. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations, and the terms of the federal award. The ETA 9130, Financial Status Report, UI Program, “Employment Service and Unemployment Insurance Programs”, is the quarterly summary of program and administrative expenditures. All ETA grantees are required to submit quarterly financial reports for each grant award, including standard program and pilot, demonstration, and evaluation projects. A separate ETA 9130 is submitted for each of the following: Unemployment Insurance, Pandemic Emergency Unemployment Compensation, Pandemic Unemployment Assistance Administration, Trade Adjustment Assistance/Reemployment Trade Adjustment Assistance and UI Projects. U.S. Department of Labor Employment and Training Administration Financial Report Instructions requires the report to be submitted electronically no later than 45 calendar days after each specified reporting period. A closeout report is required to be submitted no later than 90 calendar days after the grant end date. Condition – Six of eleven reports tested were not independently reviewed and one report was submitted five days late. Cause – Although procedures have been established to require independent review and approval of the ETA 9130 reports be documented and retained, this review was not always documented. In addition, Department procedures have not been established to ensure reports are submitted timely. Effect – The lack of a documented review of the ETA 9130 reports increases the risk for undetected reporting errors or misstatements. In addition, the lack of established policies and procedures resulted in the late submission of one quarterly report. Recommendation – The Department should follow the established policies and procedures to ensure reports are independently reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. In addition, the Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. Response and Corrective Action Planned – The Department has implemented a procedure to ensure ETA 9130 reports are filed timely and evidence of review is present on supporting documentation. Effective March 31, 2023, U.S. Department of Labor transitioned ETA 9130 reporting to Payment Management System, a feature of this is automatic logging of a user’s identify for submittal and users identify for grantee certification. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations, and the terms of the federal award. The ETA 9130, Financial Status Report, UI Program, “Employment Service and Unemployment Insurance Programs”, is the quarterly summary of program and administrative expenditures. All ETA grantees are required to submit quarterly financial reports for each grant award, including standard program and pilot, demonstration, and evaluation projects. A separate ETA 9130 is submitted for each of the following: Unemployment Insurance, Pandemic Emergency Unemployment Compensation, Pandemic Unemployment Assistance Administration, Trade Adjustment Assistance/Reemployment Trade Adjustment Assistance and UI Projects. U.S. Department of Labor Employment and Training Administration Financial Report Instructions requires the report to be submitted electronically no later than 45 calendar days after each specified reporting period. A closeout report is required to be submitted no later than 90 calendar days after the grant end date. Condition – Six of eleven reports tested were not independently reviewed and one report was submitted five days late. Cause – Although procedures have been established to require independent review and approval of the ETA 9130 reports be documented and retained, this review was not always documented. In addition, Department procedures have not been established to ensure reports are submitted timely. Effect – The lack of a documented review of the ETA 9130 reports increases the risk for undetected reporting errors or misstatements. In addition, the lack of established policies and procedures resulted in the late submission of one quarterly report. Recommendation – The Department should follow the established policies and procedures to ensure reports are independently reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. In addition, the Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. Response and Corrective Action Planned – The Department has implemented a procedure to ensure ETA 9130 reports are filed timely and evidence of review is present on supporting documentation. Effective March 31, 2023, U.S. Department of Labor transitioned ETA 9130 reporting to Payment Management System, a feature of this is automatic logging of a user’s identify for submittal and users identify for grantee certification. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The ETA 191 report, “Statement of Expenditures and Financial Adjustments of Federal Funds for Unemployment Compensation for Federal Employees and Ex-Service members”, is the quarterly summary of unemployment compensation expenditures and adjustments and the total amount of benefits paid to claimants of each federal and military agency. Unemployment Insurance (UI) Reports Handbook No. 401 requires the report to be submitted electronically to the Employment and Training Administration of the U.S. Department of Labor by the 25th of the month following the close of the quarter. Condition – Two of the four quarterly reports were submitted between one and eight days late. Cause – Department procedures were not established in fiscal year 2022 to ensure reports are submitted timely. The Department also utilizes a database to identify unemployment compensation paid to Federal Employees and Ex-Service members. For the June 2022 ETA 191, the database was not available to the Department until after the ETA 191’s due date. Effect – The lack of established policies and procedures resulted in the late submission of quarterly reports. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. Response and Corrective Action Planned – A policy and procedure has been established for reporting and filing the ETA 191. Included in the procedure is a requirement to submit the report to the Chief Financial Officer for review and approval. Evidence of review and transmittal is documented via email confirmation to the Accountant 3 responsible for preparing the ETA 191. Review and approval of the ETA 191 is required to be completed prior to the reports due date. After transmittal to DOL of the ETA 191; a copy with supporting documentation is made available to the Unemployment Division Administrator. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The ETA 191 report, “Statement of Expenditures and Financial Adjustments of Federal Funds for Unemployment Compensation for Federal Employees and Ex-Service members”, is the quarterly summary of unemployment compensation expenditures and adjustments and the total amount of benefits paid to claimants of each federal and military agency. Unemployment Insurance (UI) Reports Handbook No. 401 requires the report to be submitted electronically to the Employment and Training Administration of the U.S. Department of Labor by the 25th of the month following the close of the quarter. Condition – Two of the four quarterly reports were submitted between one and eight days late. Cause – Department procedures were not established in fiscal year 2022 to ensure reports are submitted timely. The Department also utilizes a database to identify unemployment compensation paid to Federal Employees and Ex-Service members. For the June 2022 ETA 191, the database was not available to the Department until after the ETA 191’s due date. Effect – The lack of established policies and procedures resulted in the late submission of quarterly reports. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. Response and Corrective Action Planned – A policy and procedure has been established for reporting and filing the ETA 191. Included in the procedure is a requirement to submit the report to the Chief Financial Officer for review and approval. Evidence of review and transmittal is documented via email confirmation to the Accountant 3 responsible for preparing the ETA 191. Review and approval of the ETA 191 is required to be completed prior to the reports due date. After transmittal to DOL of the ETA 191; a copy with supporting documentation is made available to the Unemployment Division Administrator. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the auditee establish and maintain effective internal control over the federal award which provides reasonable assurance the auditee is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The ETA 9050 report, “Time Lapse of All First Payments Except Workshare”, provides information on the time it takes, states to pay benefits to claimants for the first compensable week of unemployment. The ETA 9052 report, “Nonmonetary Determination Time Lapse Detection”, provides information on the time it takes, states to issue nonmonetary determinations from the date the issues are first detected by the agency. The ETA 9055 report, “Appeals Case Aging”, provides information on the inventory of lower authority and higher authority single claimant appeals cases that have been filed but not decided. Appeals case aging provides information about the number of days from the date an appeal was filed through the end of the month covered by the report. Also included are the average and median ages of the pending single claimant appeals cases. The UI Reports Handbook No. 401 requires the reports to be submitted on the 20th of the month following the month to which the data relates. Condition – Supporting documentation for the monthly reports was not retained. Reports submitted were not reviewed and approved by an independent person for propriety prior to submission. Cause – Department procedures have not been established to retain supporting documentation for the data fields in the report. In addition, Department procedures have not been established to require documentation the reports were independently reviewed and approved. Effect – The lack of supporting documentation and a documented review of these reports increases the risk for undetected reporting errors or misstatements. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely and the support for the preparation of the report is retained. The policies established should also ensure the quarterly reports are reviewed and approved by an independent person who is knowledgeable about the program and are submitted by the due date. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – Procedures have been established for transmitting the ETA 9050, 9052 and 9055 reports. Included in the procedures are where to retain the supporting data file and review of the report by the Division Administrator or Deputy Division Administrator prior to final transmission. The report must be returned with a signature and date prior to submitting the finalized reports to the Department of Labor within the reporting deadline. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the auditee establish and maintain effective internal control over the federal award which provides reasonable assurance the auditee is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The ETA 9050 report, “Time Lapse of All First Payments Except Workshare”, provides information on the time it takes, states to pay benefits to claimants for the first compensable week of unemployment. The ETA 9052 report, “Nonmonetary Determination Time Lapse Detection”, provides information on the time it takes, states to issue nonmonetary determinations from the date the issues are first detected by the agency. The ETA 9055 report, “Appeals Case Aging”, provides information on the inventory of lower authority and higher authority single claimant appeals cases that have been filed but not decided. Appeals case aging provides information about the number of days from the date an appeal was filed through the end of the month covered by the report. Also included are the average and median ages of the pending single claimant appeals cases. The UI Reports Handbook No. 401 requires the reports to be submitted on the 20th of the month following the month to which the data relates. Condition – Supporting documentation for the monthly reports was not retained. Reports submitted were not reviewed and approved by an independent person for propriety prior to submission. Cause – Department procedures have not been established to retain supporting documentation for the data fields in the report. In addition, Department procedures have not been established to require documentation the reports were independently reviewed and approved. Effect – The lack of supporting documentation and a documented review of these reports increases the risk for undetected reporting errors or misstatements. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely and the support for the preparation of the report is retained. The policies established should also ensure the quarterly reports are reviewed and approved by an independent person who is knowledgeable about the program and are submitted by the due date. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – Procedures have been established for transmitting the ETA 9050, 9052 and 9055 reports. Included in the procedures are where to retain the supporting data file and review of the report by the Division Administrator or Deputy Division Administrator prior to final transmission. The report must be returned with a signature and date prior to submitting the finalized reports to the Department of Labor within the reporting deadline. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the auditee establish and maintain effective internal control over the federal award which provides reasonable assurance the auditee is managing the federal award in compliance with federal statutes, regulation and the terms of the federal award. The ETA 2208A report, “Quarterly UI Contingency Report”, provides information on the number of staff years worked and paid for various UI program categories, and provides the basis for determining above-base entitlements. UI Reports Handbook No. 336 requires the report to be submitted electronically for each calendar quarter to the Employment and Training Administration of the U.S. Department of Labor within 30 days after the end of the reporting quarter to which it relates. Condition – Three of four quarterly reports were submitted between one and nineteen days late. In addition, the Department indicated the reports submitted were reviewed and approved; however, we determined this review was not documented for one of four quarterly reports. Cause – Department procedures have not been established to ensure reports are submitted timely and to require the independent review and approval of the reports be documented. Effect – The lack of a documented review of these reports increases the risk for undetected reporting errors or misstatements. In addition, the lack of established policies and procedures resulted in the late submission of the three reports. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. The policies established should also ensure the quarterly reports are reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – A policy and procedures will be established for the quarter ending September 30, 2023, to ensure evidence of an independent review is documented by the reviewer’s and date of the review prior to submission, within the reporting deadline. The ETA 2208A report will be reviewed by the Chief Financial Officer and will be evidenced by email approval prior to any future ETA 2208A submissions to the ETA. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the auditee establish and maintain effective internal control over the federal award which provides reasonable assurance the auditee is managing the federal award in compliance with federal statutes, regulation and the terms of the federal award. The ETA 2208A report, “Quarterly UI Contingency Report”, provides information on the number of staff years worked and paid for various UI program categories, and provides the basis for determining above-base entitlements. UI Reports Handbook No. 336 requires the report to be submitted electronically for each calendar quarter to the Employment and Training Administration of the U.S. Department of Labor within 30 days after the end of the reporting quarter to which it relates. Condition – Three of four quarterly reports were submitted between one and nineteen days late. In addition, the Department indicated the reports submitted were reviewed and approved; however, we determined this review was not documented for one of four quarterly reports. Cause – Department procedures have not been established to ensure reports are submitted timely and to require the independent review and approval of the reports be documented. Effect – The lack of a documented review of these reports increases the risk for undetected reporting errors or misstatements. In addition, the lack of established policies and procedures resulted in the late submission of the three reports. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. The policies established should also ensure the quarterly reports are reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – A policy and procedures will be established for the quarter ending September 30, 2023, to ensure evidence of an independent review is documented by the reviewer’s and date of the review prior to submission, within the reporting deadline. The ETA 2208A report will be reviewed by the Chief Financial Officer and will be evidenced by email approval prior to any future ETA 2208A submissions to the ETA. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the auditee establish and maintain effective internal control over the federal award which provides reasonable assurance the auditee is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The ETA 9130, Financial Status Report, is the quarterly summary of program and administrative expenditures. All ETA grantees are required to submit quarterly financial reports for each grant award which they operate, including standard program and pilot, demonstration and evaluation projects. U.S. Department of Labor Employment and Training Administration Financial Report Instructions requires the report to be submitted electronically no later than 45 calendar days after each specified reporting period. A closeout report is required to be submitted no later than 90 calendar days after the grant end date. Condition – For 20 of 33 reports tested, reports were submitted between one and four days late. None of the 33 reports tested were independently reviewed. In addition, for 15 of the 33 reports tested total expenditures did not agree with the state’s accounting system. In total the reports were understated $1,047,345, with ranges of an overstatement of $54,130 to an understatement of $382,430. For 11 of the 33 reports tested, administration expenditures did not agree with the state’s accounting system. In total, the reports were understated $240,290, with ranges of an overstatement of $19,456 to an understatement of $146,606. Cause – The Department did not ensure the reconciliation of the state accounting system by program was performed, or the ETA 9130 reports were independently reviewed, were supported and documentation was retained. Effect – The lack of a documented review of the ETA 9130 reports increases the risk for undetected reporting errors or misstatements. In addition, the lack of established policies and procedures resulted in late submission of quarterly reports and reporting errors. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. In addition, the Department should establish policies and procedures to ensure reports are reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Also, the Department should ensure expenditures are properly reported and a reconciliation to the state accounting system is performed. Response and Corrective Action Planned – The Department has implemented a procedure to ensure ETA 9130 reports are filed timely and evidence of review is present on supporting documentation. Effective March 31, 2023, U.S. Department of Labor transitioned ETA 9130 reporting to Payment Management System, a feature of this is automatic logging of a user’s identify for submittal and users identify for grantee certification. Specific to WIOA Title I programs, the department is reviewing procedures related to WIOA ETA 9130 filings, including reconciliation requirements of the WIOA Title I program, and reporting obligations and accruals. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the auditee establish and maintain effective internal control over the federal award which provides reasonable assurance the auditee is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The ETA 9130, Financial Status Report, is the quarterly summary of program and administrative expenditures. All ETA grantees are required to submit quarterly financial reports for each grant award which they operate, including standard program and pilot, demonstration and evaluation projects. U.S. Department of Labor Employment and Training Administration Financial Report Instructions requires the report to be submitted electronically no later than 45 calendar days after each specified reporting period. A closeout report is required to be submitted no later than 90 calendar days after the grant end date. Condition – For 20 of 33 reports tested, reports were submitted between one and four days late. None of the 33 reports tested were independently reviewed. In addition, for 15 of the 33 reports tested total expenditures did not agree with the state’s accounting system. In total the reports were understated $1,047,345, with ranges of an overstatement of $54,130 to an understatement of $382,430. For 11 of the 33 reports tested, administration expenditures did not agree with the state’s accounting system. In total, the reports were understated $240,290, with ranges of an overstatement of $19,456 to an understatement of $146,606. Cause – The Department did not ensure the reconciliation of the state accounting system by program was performed, or the ETA 9130 reports were independently reviewed, were supported and documentation was retained. Effect – The lack of a documented review of the ETA 9130 reports increases the risk for undetected reporting errors or misstatements. In addition, the lack of established policies and procedures resulted in late submission of quarterly reports and reporting errors. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. In addition, the Department should establish policies and procedures to ensure reports are reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Also, the Department should ensure expenditures are properly reported and a reconciliation to the state accounting system is performed. Response and Corrective Action Planned – The Department has implemented a procedure to ensure ETA 9130 reports are filed timely and evidence of review is present on supporting documentation. Effective March 31, 2023, U.S. Department of Labor transitioned ETA 9130 reporting to Payment Management System, a feature of this is automatic logging of a user’s identify for submittal and users identify for grantee certification. Specific to WIOA Title I programs, the department is reviewing procedures related to WIOA ETA 9130 filings, including reconciliation requirements of the WIOA Title I program, and reporting obligations and accruals. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the auditee establish and maintain effective internal control over the federal award which provides reasonable assurance the auditee is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The ETA 9130, Financial Status Report, is the quarterly summary of program and administrative expenditures. All ETA grantees are required to submit quarterly financial reports for each grant award which they operate, including standard program and pilot, demonstration and evaluation projects. U.S. Department of Labor Employment and Training Administration Financial Report Instructions requires the report to be submitted electronically no later than 45 calendar days after each specified reporting period. A closeout report is required to be submitted no later than 90 calendar days after the grant end date. Condition – For 20 of 33 reports tested, reports were submitted between one and four days late. None of the 33 reports tested were independently reviewed. In addition, for 15 of the 33 reports tested total expenditures did not agree with the state’s accounting system. In total the reports were understated $1,047,345, with ranges of an overstatement of $54,130 to an understatement of $382,430. For 11 of the 33 reports tested, administration expenditures did not agree with the state’s accounting system. In total, the reports were understated $240,290, with ranges of an overstatement of $19,456 to an understatement of $146,606. Cause – The Department did not ensure the reconciliation of the state accounting system by program was performed, or the ETA 9130 reports were independently reviewed, were supported and documentation was retained. Effect – The lack of a documented review of the ETA 9130 reports increases the risk for undetected reporting errors or misstatements. In addition, the lack of established policies and procedures resulted in late submission of quarterly reports and reporting errors. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. In addition, the Department should establish policies and procedures to ensure reports are reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Also, the Department should ensure expenditures are properly reported and a reconciliation to the state accounting system is performed. Response and Corrective Action Planned – The Department has implemented a procedure to ensure ETA 9130 reports are filed timely and evidence of review is present on supporting documentation. Effective March 31, 2023, U.S. Department of Labor transitioned ETA 9130 reporting to Payment Management System, a feature of this is automatic logging of a user’s identify for submittal and users identify for grantee certification. Specific to WIOA Title I programs, the department is reviewing procedures related to WIOA ETA 9130 filings, including reconciliation requirements of the WIOA Title I program, and reporting obligations and accruals. Conclusion – Response accepted.
WIOA Participant Individual Record Layout (PIRL) Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The PIRL provides a streamlined data collection on the Workforce Innovation and Opportunity Act (WIOA) program activities and outcomes into a single streamlined reporting structure. The report captures information related to WIOA applicants, including WIOA participants who receive benefits and services across the program with a standardized set of data elements which includes information on participant demographics, types of services received and performance outcomes. The PIRL is intended to track information on WIOA activity on a “real time” basis for individuals from the point of WIOA eligibility determination through post-participation outcomes. Quarterly reports are to be submitted no later than 45 days after the end of each report quarter. Condition – The PIRL report independent review was not documented. Cause – Department procedures have not been established to require independent review and approval of the reports be documented. Effect – The lack of a documented review of these reports increases the risk for undetected reporting errors or misstatements. Recommendation – The Department should establish policies and procedures to ensure the quarterly reports are reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – We understand the Auditor's Office requirement for independent review. The same one file (PIRL file) includes multiple programs that includes but is not limited to Title I Adult, Dislocated Worker and Youth, Trade, etc. The State does do a formal Independent Review for the Trade program each quarter and many of these records are co-enrolled and include the same data elements for review. These are part of the same submission file (Trade and Title I are in the same PIRL file.) The State has also provided that numerous reviews of data do take place throughout each quarter and on an ongoing basis to include our data element validation process to ensure accurate reporting to the Department of Labor. The Department will receive the PIRL file and will ensure an independent review of the WIOA Title I related data elements is completed prior to submission. This review will be completed by a knowledgeable, independent staff person(s) by pulling a random sample of participants and reviewing the correct time frames and data elements are included in the file. After review, the independent reviewer will indicate evidence of the review through an electronic sign off using system tools of the random sample. This will ensure our data management system goals to improve efficiency and move toward a fully electronic system and record keeping. Conclusion – Response accepted.
WIOA Participant Individual Record Layout (PIRL) Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The PIRL provides a streamlined data collection on the Workforce Innovation and Opportunity Act (WIOA) program activities and outcomes into a single streamlined reporting structure. The report captures information related to WIOA applicants, including WIOA participants who receive benefits and services across the program with a standardized set of data elements which includes information on participant demographics, types of services received and performance outcomes. The PIRL is intended to track information on WIOA activity on a “real time” basis for individuals from the point of WIOA eligibility determination through post-participation outcomes. Quarterly reports are to be submitted no later than 45 days after the end of each report quarter. Condition – The PIRL report independent review was not documented. Cause – Department procedures have not been established to require independent review and approval of the reports be documented. Effect – The lack of a documented review of these reports increases the risk for undetected reporting errors or misstatements. Recommendation – The Department should establish policies and procedures to ensure the quarterly reports are reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – We understand the Auditor's Office requirement for independent review. The same one file (PIRL file) includes multiple programs that includes but is not limited to Title I Adult, Dislocated Worker and Youth, Trade, etc. The State does do a formal Independent Review for the Trade program each quarter and many of these records are co-enrolled and include the same data elements for review. These are part of the same submission file (Trade and Title I are in the same PIRL file.) The State has also provided that numerous reviews of data do take place throughout each quarter and on an ongoing basis to include our data element validation process to ensure accurate reporting to the Department of Labor. The Department will receive the PIRL file and will ensure an independent review of the WIOA Title I related data elements is completed prior to submission. This review will be completed by a knowledgeable, independent staff person(s) by pulling a random sample of participants and reviewing the correct time frames and data elements are included in the file. After review, the independent reviewer will indicate evidence of the review through an electronic sign off using system tools of the random sample. This will ensure our data management system goals to improve efficiency and move toward a fully electronic system and record keeping. Conclusion – Response accepted.
WIOA Participant Individual Record Layout (PIRL) Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The PIRL provides a streamlined data collection on the Workforce Innovation and Opportunity Act (WIOA) program activities and outcomes into a single streamlined reporting structure. The report captures information related to WIOA applicants, including WIOA participants who receive benefits and services across the program with a standardized set of data elements which includes information on participant demographics, types of services received and performance outcomes. The PIRL is intended to track information on WIOA activity on a “real time” basis for individuals from the point of WIOA eligibility determination through post-participation outcomes. Quarterly reports are to be submitted no later than 45 days after the end of each report quarter. Condition – The PIRL report independent review was not documented. Cause – Department procedures have not been established to require independent review and approval of the reports be documented. Effect – The lack of a documented review of these reports increases the risk for undetected reporting errors or misstatements. Recommendation – The Department should establish policies and procedures to ensure the quarterly reports are reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – We understand the Auditor's Office requirement for independent review. The same one file (PIRL file) includes multiple programs that includes but is not limited to Title I Adult, Dislocated Worker and Youth, Trade, etc. The State does do a formal Independent Review for the Trade program each quarter and many of these records are co-enrolled and include the same data elements for review. These are part of the same submission file (Trade and Title I are in the same PIRL file.) The State has also provided that numerous reviews of data do take place throughout each quarter and on an ongoing basis to include our data element validation process to ensure accurate reporting to the Department of Labor. The Department will receive the PIRL file and will ensure an independent review of the WIOA Title I related data elements is completed prior to submission. This review will be completed by a knowledgeable, independent staff person(s) by pulling a random sample of participants and reviewing the correct time frames and data elements are included in the file. After review, the independent reviewer will indicate evidence of the review through an electronic sign off using system tools of the random sample. This will ensure our data management system goals to improve efficiency and move toward a fully electronic system and record keeping. Conclusion – Response accepted.
Federal Funding Accountability and Transparency Act Reporting Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. Under the requirements of the Federal Funding Accountability and Transparency Act (Pub. L. No. 109-282), as amended by Section 6202 of Pub. L. No. 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Condition – The Department did not report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS) for WIOA Cluster subrecipients. Cause – The Department was unaware of the requirement until it was brought to their attention. Effect – The Department was not in compliance with report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Recommendation – The Department should establish policies and procedures to ensure first-tier subawards of $30,000 or more are reported to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Policies and procedures should ensure the reporting is reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – The Department will establish policies and procedures to ensure first-tier subawards of $30,000 or more are reported to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Policies and procedures will ensure the reporting is reviewed and approved by an independent person who is knowledgeable about the program. This independent review will be documented by the reviewer’s signature or initials and date of review prior to submission. The Department plans to begin this process in October 2023. Conclusion – Response accepted.
Federal Funding Accountability and Transparency Act Reporting Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. Under the requirements of the Federal Funding Accountability and Transparency Act (Pub. L. No. 109-282), as amended by Section 6202 of Pub. L. No. 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Condition – The Department did not report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS) for WIOA Cluster subrecipients. Cause – The Department was unaware of the requirement until it was brought to their attention. Effect – The Department was not in compliance with report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Recommendation – The Department should establish policies and procedures to ensure first-tier subawards of $30,000 or more are reported to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Policies and procedures should ensure the reporting is reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – The Department will establish policies and procedures to ensure first-tier subawards of $30,000 or more are reported to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Policies and procedures will ensure the reporting is reviewed and approved by an independent person who is knowledgeable about the program. This independent review will be documented by the reviewer’s signature or initials and date of review prior to submission. The Department plans to begin this process in October 2023. Conclusion – Response accepted.
Federal Funding Accountability and Transparency Act Reporting Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. Under the requirements of the Federal Funding Accountability and Transparency Act (Pub. L. No. 109-282), as amended by Section 6202 of Pub. L. No. 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Condition – The Department did not report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS) for WIOA Cluster subrecipients. Cause – The Department was unaware of the requirement until it was brought to their attention. Effect – The Department was not in compliance with report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Recommendation – The Department should establish policies and procedures to ensure first-tier subawards of $30,000 or more are reported to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Policies and procedures should ensure the reporting is reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – The Department will establish policies and procedures to ensure first-tier subawards of $30,000 or more are reported to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Policies and procedures will ensure the reporting is reviewed and approved by an independent person who is knowledgeable about the program. This independent review will be documented by the reviewer’s signature or initials and date of review prior to submission. The Department plans to begin this process in October 2023. Conclusion – Response accepted.
Awards to Subrecipients Criteria – The Uniform Guidance, Part 200.332 states, “All pass-through entities must: ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward.” Required information includes identification of whether the award is research and development (R&D) and the indirect cost rate for the federal award (including if the de minimis rate is charged) per Part 200.414. Condition – For subawards the Department did not include identification of whether the award is R&D or the indirect cost rate for the federal award (including if the de minimis rate is charged) per Part 200.414. Cause – The Department has not established policies and procedures to ensure all required information is included in the subaward to the subrecipients. Effect – The information required in the subaward to subrecipients was not included due to the lack of policies and procedures. Recommendation – The Department should establish policies and procedures to ensure all required information is included in the subaward to subrecipients as required by Uniform Guidance, Part 200.332. Response and Corrective Action Planned – Effective October, 2023; new sub-awards and pass thru grant agreements will have elements specified in the respective agreement as required by Uniform Guidance, Part 200.332. Conclusion – Response accepted.
Awards to Subrecipients Criteria – The Uniform Guidance, Part 200.332 states, “All pass-through entities must: ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward.” Required information includes identification of whether the award is research and development (R&D) and the indirect cost rate for the federal award (including if the de minimis rate is charged) per Part 200.414. Condition – For subawards the Department did not include identification of whether the award is R&D or the indirect cost rate for the federal award (including if the de minimis rate is charged) per Part 200.414. Cause – The Department has not established policies and procedures to ensure all required information is included in the subaward to the subrecipients. Effect – The information required in the subaward to subrecipients was not included due to the lack of policies and procedures. Recommendation – The Department should establish policies and procedures to ensure all required information is included in the subaward to subrecipients as required by Uniform Guidance, Part 200.332. Response and Corrective Action Planned – Effective October, 2023; new sub-awards and pass thru grant agreements will have elements specified in the respective agreement as required by Uniform Guidance, Part 200.332. Conclusion – Response accepted.
Awards to Subrecipients Criteria – The Uniform Guidance, Part 200.332 states, “All pass-through entities must: ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward.” Required information includes identification of whether the award is research and development (R&D) and the indirect cost rate for the federal award (including if the de minimis rate is charged) per Part 200.414. Condition – For subawards the Department did not include identification of whether the award is R&D or the indirect cost rate for the federal award (including if the de minimis rate is charged) per Part 200.414. Cause – The Department has not established policies and procedures to ensure all required information is included in the subaward to the subrecipients. Effect – The information required in the subaward to subrecipients was not included due to the lack of policies and procedures. Recommendation – The Department should establish policies and procedures to ensure all required information is included in the subaward to subrecipients as required by Uniform Guidance, Part 200.332. Response and Corrective Action Planned – Effective October, 2023; new sub-awards and pass thru grant agreements will have elements specified in the respective agreement as required by Uniform Guidance, Part 200.332. Conclusion – Response accepted.
Subrecipient Monitoring Criteria – The Uniform Guidance, Part 200.332 states in part, “All pass-through entities must: evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring.” The Uniform Guidance, Part 200.332 also states, “All pass-through entities must: monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Pass-through entity monitoring of the subrecipient must include reviewing financial and performance reports required by the pass-through entity, following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the Federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and written confirmation from the subrecipient, highlighting the status of actions planned or taken to address Single Audit findings related to the particular subaward and issuing a management decision for applicable audit findings pertaining only to the Federal award provided to the subrecipient from the pass-through entity as required by Part 200.521.” The Uniform Guidance, Part 200.332 also states, “All pass-through entities must: Verify that every subrecipient is audited as required by Subpart F when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in Part 200.501.” and that “All pass-through entities must: consider whether the results of the subrecipient's audits, on-site reviews, or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records.” Condition – The Department did not perform financial monitoring for eight of nine subrecipients tested. For the eight where financial monitoring was not performed, we identified the following: The Department did not evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. The Department did not monitor the activities of the subrecipient to ensure the subaward was used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward. The Department did not verify that every subrecipient is audited as required by Subpart F when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in Part 200.501. The Department did not consider whether the results of the subrecipient's audits, on-site reviews or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records. Cause – The Department has not established policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332. Effect – The Department is not in compliance with subrecipient monitoring as required by the Uniform Guidance, Part 200.332. Recommendation – The Department should establish policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332. Response and Corrective Action Planned – The Department established policies and procedures to perform financial subrecipient monitoring for subawards related to WIOA and began that process in May of 2023. The Department is also enhancing its fiscal review process starting with funding requests from sub-recipients and partnering with WIOA Title I program staff to identify areas of risk. The monitoring will be performed to ensure compliance with WIOA and Uniform Guidance, Part 200.332. Conclusion – Response accepted.
Subrecipient Monitoring Criteria – The Uniform Guidance, Part 200.332 states in part, “All pass-through entities must: evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring.” The Uniform Guidance, Part 200.332 also states, “All pass-through entities must: monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Pass-through entity monitoring of the subrecipient must include reviewing financial and performance reports required by the pass-through entity, following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the Federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and written confirmation from the subrecipient, highlighting the status of actions planned or taken to address Single Audit findings related to the particular subaward and issuing a management decision for applicable audit findings pertaining only to the Federal award provided to the subrecipient from the pass-through entity as required by Part 200.521.” The Uniform Guidance, Part 200.332 also states, “All pass-through entities must: Verify that every subrecipient is audited as required by Subpart F when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in Part 200.501.” and that “All pass-through entities must: consider whether the results of the subrecipient's audits, on-site reviews, or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records.” Condition – The Department did not perform financial monitoring for eight of nine subrecipients tested. For the eight where financial monitoring was not performed, we identified the following: The Department did not evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. The Department did not monitor the activities of the subrecipient to ensure the subaward was used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward. The Department did not verify that every subrecipient is audited as required by Subpart F when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in Part 200.501. The Department did not consider whether the results of the subrecipient's audits, on-site reviews or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records. Cause – The Department has not established policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332. Effect – The Department is not in compliance with subrecipient monitoring as required by the Uniform Guidance, Part 200.332. Recommendation – The Department should establish policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332. Response and Corrective Action Planned – The Department established policies and procedures to perform financial subrecipient monitoring for subawards related to WIOA and began that process in May of 2023. The Department is also enhancing its fiscal review process starting with funding requests from sub-recipients and partnering with WIOA Title I program staff to identify areas of risk. The monitoring will be performed to ensure compliance with WIOA and Uniform Guidance, Part 200.332. Conclusion – Response accepted.
Subrecipient Monitoring Criteria – The Uniform Guidance, Part 200.332 states in part, “All pass-through entities must: evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring.” The Uniform Guidance, Part 200.332 also states, “All pass-through entities must: monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Pass-through entity monitoring of the subrecipient must include reviewing financial and performance reports required by the pass-through entity, following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the Federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and written confirmation from the subrecipient, highlighting the status of actions planned or taken to address Single Audit findings related to the particular subaward and issuing a management decision for applicable audit findings pertaining only to the Federal award provided to the subrecipient from the pass-through entity as required by Part 200.521.” The Uniform Guidance, Part 200.332 also states, “All pass-through entities must: Verify that every subrecipient is audited as required by Subpart F when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in Part 200.501.” and that “All pass-through entities must: consider whether the results of the subrecipient's audits, on-site reviews, or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records.” Condition – The Department did not perform financial monitoring for eight of nine subrecipients tested. For the eight where financial monitoring was not performed, we identified the following: The Department did not evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. The Department did not monitor the activities of the subrecipient to ensure the subaward was used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward. The Department did not verify that every subrecipient is audited as required by Subpart F when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in Part 200.501. The Department did not consider whether the results of the subrecipient's audits, on-site reviews or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records. Cause – The Department has not established policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332. Effect – The Department is not in compliance with subrecipient monitoring as required by the Uniform Guidance, Part 200.332. Recommendation – The Department should establish policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332. Response and Corrective Action Planned – The Department established policies and procedures to perform financial subrecipient monitoring for subawards related to WIOA and began that process in May of 2023. The Department is also enhancing its fiscal review process starting with funding requests from sub-recipients and partnering with WIOA Title I program staff to identify areas of risk. The monitoring will be performed to ensure compliance with WIOA and Uniform Guidance, Part 200.332. Conclusion – Response accepted.
Awards to Subrecipients Criteria – During fiscal year 2022, the Governor allocated Coronavirus State and Local Recovery Funds to the Department for Summer Youth Internship Projects to provide internship opportunities in high-demand fields for youth with barriers and/or at risk of not graduating. All projects include recruitment of youth at risk of not graduating and youth from underrepresented communities and/or from low-income households. The primary supported occupations include healthcare, construction-related trades, information technology, advanced manufacturing, and energy. The Healthy Childhood Environments: Child Care Challenge project was to create new childcare slots across the State and help communities improve their childcare options and bolster opportunities for Iowans to reenter the workforce. All the projects are designed to address childcare shortages and alleviate local childcare need. The Uniform Guidance, Part 200.332 states, “All pass-through entities must: ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward.” Required information includes, in part, subrecipient's unique entity identifier, federal award identification number (FAIN), subaward budget period start and end date, identification of whether the award is research and development (R&D), and the indirect cost rate for the federal award (including if the de minimis rate is charged) per Part 200.414. Condition – For the subawards provided, the Department did not include the subrecipient's unique entity identifier, FAIN, subaward budget period start and end date, identification of whether the award is R&D, and the indirect cost rate for the federal award (including if the de minimis rate is charged) per Part 200.414. Cause – The Department has not established policies and procedures to ensure all required information is included in the subaward to the subrecipients. Effect – The information required in the subaward to subrecipients was not included due to the lack of policies and procedures. Recommendation – The Department should establish policies and procedures to ensure all required information is included in the subaward to subrecipients as required by Uniform Guidance, Part 200.332. Response and Corrective Action Planned – Effective August 2023, new sub-awards and pass thru grant agreements have elements specified in the respective agreement as required by Uniform Guidance, Part 200.332. Conclusion – Response accepted.
Subrecipient Monitoring Criteria – The Uniform Guidance, Part 200.332 states in part, “All pass-through entities must: evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring.” The Uniform Guidance, Part 200.332 also states, “All pass-through entities must: monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Pass-through entity monitoring of the subrecipient must include reviewing financial and performance reports required by the pass-through entity, following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the Federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and written confirmation from the subrecipient, highlighting the status of actions planned or taken to address Single Audit findings related to the particular subaward and issuing a management decision for applicable audit findings pertaining only to the Federal award provided to the subrecipient from the pass-through entity as required by Part 200.521.” The Uniform Guidance further states, “Depending upon the pass-through entity’s assessment of risk posed by the subrecipient, the following monitoring tools may be useful for the pass-through entity to ensure proper accountability and compliance with program requirements and achievement of performance goals: providing subrecipients with training and technical assistance on program-related matters, performing on-site reviews of the subrecipient's program operations and arranging for agreed-upon-procedures engagements as described in Part 200.425.” The Uniform Guidance, Part 200.332 also states, “All pass-through entities must: Verify that every subrecipient is audited as required by Subpart F when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in Part 200.501.” and that “All pass-through entities must: consider whether the results of the subrecipient's audits, on-site reviews, or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records.” In addition, Uniform Guidance, Part 200.501(h) states in part, “The pass-through entity is responsible for establishing requirements, as necessary, to ensure compliance by for-profit subrecipients.” and “Methods to ensure compliance for Federal awards made to for-profit subrecipients may include pre-award audits, monitoring during the agreement, and post-award audits.” Condition – The Department did not evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. The Department did not monitor the activities of subrecipients as necessary to ensure the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved, including the monitoring of Part 200.332(d)(1) to Part 200.332(d)(4). In addition, the Department did not utilize any of the monitoring tools identified in Part 200.332(e) to ensure proper accountability and compliance with program requirements and achievement of performance goals. The Department did not verify every subrecipient is audited as required by Subpart F when it is expected the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in Part 200.501. The Department did not consider whether the results of the subrecipient's audits, on-site reviews or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records. The Department did not establish policies and procedures to ensure compliance for Federal awards made to for-profit subrecipients as required in Part 200.501(h). Cause – The Department has not established policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332 and Part 200.501. The Department was also facing significant time and resource constraints, including the initial requirement of the Coronavirus State and Local Fiscal Recovery Funds (CSLFRF). Effect – The Department is not in compliance with subrecipient monitoring as required by the Uniform Guidance, Part 200.332 and Part 200.501. Recommendation – The Department should establish policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332 and Part 200.501. Response and Corrective Action Planned – The Department is in the process of developing policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332 and Part 200.501 for federal awards granted with CSLFRF. The Department intends to conduct monitoring and compliance with applicable Uniform Guidance in fiscal year 2023. Specific areas to address are: Review of the subrecipient and subrecipient grant application to assess risk and to ensure approved programs are in compliance with CSLFRF. Review of documentation provided by subrecipients to ensure expenditures align with the grant application, are supported and are allowable under CSLFRF. Validate that program expenditures benefit individuals that were negatively impacted by the COVID-19 pandemic. Review post-award reports to determine if proposed projects and related goals were achieved. Identify entities that require an audit per Uniform Guidance, Part 200.501 and follow up on audit deficiencies related to the federal award. Conclusion – Response accepted.
Payroll Distribution Criteria – The Uniform Guidance, Part 200.430(i), states “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed.” These records must, “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Also, “Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: The system for establishing the estimates produces reasonable approximations of the activity actually performed; significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the long term; and the non-Federal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition – The Department uses budget estimates to establish interim rates to allocate payroll costs to be used for Department budgeting and to provide employees with an estimate of time which is expected of them for their assigned programs. The Department has informed employees they are to report the actual time worked on each program code associated with a specific Federal, non-Federal, indirect or cost allocation program. After the January 20, 2022 pay period, a corrective disbursement entry was not prepared in the state accounting system to adjust the estimated time by program to the actual time as reported in the time reporting system. Cause – The Department transitioned to a new payroll and time tracking system. A feature of the system was to allow for time entries to directly charge the respective grant or functions within the accounting ledger. This feature was not implemented into the payroll and time tracking system, as a result the Department established policies and procedures to require actual hours worked on program codes be assigned to their respective program codes in the state accounting system. Corrective disbursement entries were not performed for part of the fiscal year. Effect – Payroll costs could be charged to the incorrect program code resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should review time reporting for the pay periods beginning after January 20, 2022, to the end of the fiscal year and determine if corrective disbursement entries are needed for all programs, including the federal programs. In addition, the Department should implement policies and procedures to ensure proper distribution of salary and wages. Response and Corrective Action Planned – The Department has implemented a payroll policy and procedure, that requires staff to enter a work reporting code for time worked and addresses timelines in which correcting entries must be completed. The Department will review all pay periods during the time frame to determine if corrective disbursement entries need to be made to properly allocate actual time reported to their respective program codes. The Department will begin the process in October 2023. Conclusion – Response accepted.
Payroll Distribution Criteria – The Uniform Guidance, Part 200.430(i), states “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed.” These records must, “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Also, “Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: The system for establishing the estimates produces reasonable approximations of the activity actually performed; significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the long term; and the non-Federal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition – The Department uses budget estimates to establish interim rates to allocate payroll costs to be used for Department budgeting and to provide employees with an estimate of time which is expected of them for their assigned programs. The Department has informed employees they are to report the actual time worked on each program code associated with a specific Federal, non-Federal, indirect or cost allocation program. After the January 20, 2022 pay period, a corrective disbursement entry was not prepared in the state accounting system to adjust the estimated time by program to the actual time as reported in the time reporting system. Cause – The Department transitioned to a new payroll and time tracking system. A feature of the system was to allow for time entries to directly charge the respective grant or functions within the accounting ledger. This feature was not implemented into the payroll and time tracking system, as a result the Department established policies and procedures to require actual hours worked on program codes be assigned to their respective program codes in the state accounting system. Corrective disbursement entries were not performed for part of the fiscal year. Effect – Payroll costs could be charged to the incorrect program code resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should review time reporting for the pay periods beginning after January 20, 2022, to the end of the fiscal year and determine if corrective disbursement entries are needed for all programs, including the federal programs. In addition, the Department should implement policies and procedures to ensure proper distribution of salary and wages. Response and Corrective Action Planned – The Department has implemented a payroll policy and procedure, that requires staff to enter a work reporting code for time worked and addresses timelines in which correcting entries must be completed. The Department will review all pay periods during the time frame to determine if corrective disbursement entries need to be made to properly allocate actual time reported to their respective program codes. The Department will begin the process in October 2023. Conclusion – Response accepted.
Payroll Distribution Criteria – The Uniform Guidance, Part 200.430(i), states “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed.” These records must, “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Also, “Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: The system for establishing the estimates produces reasonable approximations of the activity actually performed; significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the long term; and the non-Federal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition – The Department uses budget estimates to establish interim rates to allocate payroll costs to be used for Department budgeting and to provide employees with an estimate of time which is expected of them for their assigned programs. The Department has informed employees they are to report the actual time worked on each program code associated with a specific Federal, non-Federal, indirect or cost allocation program. After the January 20, 2022 pay period, a corrective disbursement entry was not prepared in the state accounting system to adjust the estimated time by program to the actual time as reported in the time reporting system. Cause – The Department transitioned to a new payroll and time tracking system. A feature of the system was to allow for time entries to directly charge the respective grant or functions within the accounting ledger. This feature was not implemented into the payroll and time tracking system, as a result the Department established policies and procedures to require actual hours worked on program codes be assigned to their respective program codes in the state accounting system. Corrective disbursement entries were not performed for part of the fiscal year. Effect – Payroll costs could be charged to the incorrect program code resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should review time reporting for the pay periods beginning after January 20, 2022, to the end of the fiscal year and determine if corrective disbursement entries are needed for all programs, including the federal programs. In addition, the Department should implement policies and procedures to ensure proper distribution of salary and wages. Response and Corrective Action Planned – The Department has implemented a payroll policy and procedure, that requires staff to enter a work reporting code for time worked and addresses timelines in which correcting entries must be completed. The Department will review all pay periods during the time frame to determine if corrective disbursement entries need to be made to properly allocate actual time reported to their respective program codes. The Department will begin the process in October 2023. Conclusion – Response accepted.
Payroll Distribution Criteria – The Uniform Guidance, Part 200.430(i), states “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed.” These records must, “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Also, “Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: The system for establishing the estimates produces reasonable approximations of the activity actually performed; significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the long term; and the non-Federal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition – The Department uses budget estimates to establish interim rates to allocate payroll costs to be used for Department budgeting and to provide employees with an estimate of time which is expected of them for their assigned programs. The Department has informed employees they are to report the actual time worked on each program code associated with a specific Federal, non-Federal, indirect or cost allocation program. After the January 20, 2022 pay period, a corrective disbursement entry was not prepared in the state accounting system to adjust the estimated time by program to the actual time as reported in the time reporting system. Cause – The Department transitioned to a new payroll and time tracking system. A feature of the system was to allow for time entries to directly charge the respective grant or functions within the accounting ledger. This feature was not implemented into the payroll and time tracking system, as a result the Department established policies and procedures to require actual hours worked on program codes be assigned to their respective program codes in the state accounting system. Corrective disbursement entries were not performed for part of the fiscal year. Effect – Payroll costs could be charged to the incorrect program code resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should review time reporting for the pay periods beginning after January 20, 2022, to the end of the fiscal year and determine if corrective disbursement entries are needed for all programs, including the federal programs. In addition, the Department should implement policies and procedures to ensure proper distribution of salary and wages. Response and Corrective Action Planned – The Department has implemented a payroll policy and procedure, that requires staff to enter a work reporting code for time worked and addresses timelines in which correcting entries must be completed. The Department will review all pay periods during the time frame to determine if corrective disbursement entries need to be made to properly allocate actual time reported to their respective program codes. The Department will begin the process in October 2023. Conclusion – Response accepted.
Payroll Distribution Criteria – The Uniform Guidance, Part 200.430(i), states “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed.” These records must, “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Also, “Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: The system for establishing the estimates produces reasonable approximations of the activity actually performed; significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the long term; and the non-Federal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition – The Department uses budget estimates to establish interim rates to allocate payroll costs to be used for Department budgeting and to provide employees with an estimate of time which is expected of them for their assigned programs. The Department has informed employees they are to report the actual time worked on each program code associated with a specific Federal, non-Federal, indirect or cost allocation program. After the January 20, 2022 pay period, a corrective disbursement entry was not prepared in the state accounting system to adjust the estimated time by program to the actual time as reported in the time reporting system. Cause – The Department transitioned to a new payroll and time tracking system. A feature of the system was to allow for time entries to directly charge the respective grant or functions within the accounting ledger. This feature was not implemented into the payroll and time tracking system, as a result the Department established policies and procedures to require actual hours worked on program codes be assigned to their respective program codes in the state accounting system. Corrective disbursement entries were not performed for part of the fiscal year. Effect – Payroll costs could be charged to the incorrect program code resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should review time reporting for the pay periods beginning after January 20, 2022, to the end of the fiscal year and determine if corrective disbursement entries are needed for all programs, including the federal programs. In addition, the Department should implement policies and procedures to ensure proper distribution of salary and wages. Response and Corrective Action Planned – The Department has implemented a payroll policy and procedure, that requires staff to enter a work reporting code for time worked and addresses timelines in which correcting entries must be completed. The Department will review all pay periods during the time frame to determine if corrective disbursement entries need to be made to properly allocate actual time reported to their respective program codes. The Department will begin the process in October 2023. Conclusion – Response accepted.
Allocable Costs Criteria – The Uniform Guidance, Part 200.405(a), states “A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. This standard is met if the cost: is incurred specifically for the Federal award; benefits both the Federal award and other work of the non-Federal entity and can be distributed in proportions that may be approximated using reasonable methods; and is necessary to the overall operation of the non-Federal entity and is assignable in part to the Federal award in accordance with the principles in this subpart.” Uniform Guidance, Part 200.405(a) states, “Direct cost allocation principles: If a cost benefits two or more projects or activities in proportions that can be determined without undue effort or cost, the cost should be allocated to the projects based on the proportional benefit. If a cost benefits two or more projects or activities in proportions that cannot be determined because of the interrelationship of the work involved, then the costs may be allocated or transferred to benefitted projects on any reasonable documented basis.” Condition – The Department has established program codes to allocate costs to both Federal and non-Federal programs. The allocation of the expenditures charged to these program codes is based on a combination of square footage and actual time reported on Federal and non-Federal programs. Department policies require rates to be updated quarterly. The rates were not updated quarterly after December 14, 2021, for the fiscal year ending June 30, 2022. Cause – The Department transitioned to a new payroll system and policies and procedures to identify time reporting requirements for staff and report capabilities were not in place to properly allocate costs. Effect – Allocable costs could be charged to the incorrect program code, resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should establish policies and procedures to properly allocate costs. In addition, the Department should review the allocable rates used during the period and determine if corrective disbursement entries are needed for all programs, including federal programs. Response and Corrective Action Planned – The Department will review allocable rates during the time frame to determine if corrective disbursement entries are need to their respective program codes. The Department will begin the process in October 2023. The Department will also revise, and update policies and procedures related to allocable costs based on time entries. Conclusion – Response accepted.
Allocable Costs Criteria – The Uniform Guidance, Part 200.405(a), states “A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. This standard is met if the cost: is incurred specifically for the Federal award; benefits both the Federal award and other work of the non-Federal entity and can be distributed in proportions that may be approximated using reasonable methods; and is necessary to the overall operation of the non-Federal entity and is assignable in part to the Federal award in accordance with the principles in this subpart.” Uniform Guidance, Part 200.405(a) states, “Direct cost allocation principles: If a cost benefits two or more projects or activities in proportions that can be determined without undue effort or cost, the cost should be allocated to the projects based on the proportional benefit. If a cost benefits two or more projects or activities in proportions that cannot be determined because of the interrelationship of the work involved, then the costs may be allocated or transferred to benefitted projects on any reasonable documented basis.” Condition – The Department has established program codes to allocate costs to both Federal and non-Federal programs. The allocation of the expenditures charged to these program codes is based on a combination of square footage and actual time reported on Federal and non-Federal programs. Department policies require rates to be updated quarterly. The rates were not updated quarterly after December 14, 2021, for the fiscal year ending June 30, 2022. Cause – The Department transitioned to a new payroll system and policies and procedures to identify time reporting requirements for staff and report capabilities were not in place to properly allocate costs. Effect – Allocable costs could be charged to the incorrect program code, resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should establish policies and procedures to properly allocate costs. In addition, the Department should review the allocable rates used during the period and determine if corrective disbursement entries are needed for all programs, including federal programs. Response and Corrective Action Planned – The Department will review allocable rates during the time frame to determine if corrective disbursement entries are need to their respective program codes. The Department will begin the process in October 2023. The Department will also revise, and update policies and procedures related to allocable costs based on time entries. Conclusion – Response accepted.
Allocable Costs Criteria – The Uniform Guidance, Part 200.405(a), states “A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. This standard is met if the cost: is incurred specifically for the Federal award; benefits both the Federal award and other work of the non-Federal entity and can be distributed in proportions that may be approximated using reasonable methods; and is necessary to the overall operation of the non-Federal entity and is assignable in part to the Federal award in accordance with the principles in this subpart.” Uniform Guidance, Part 200.405(a) states, “Direct cost allocation principles: If a cost benefits two or more projects or activities in proportions that can be determined without undue effort or cost, the cost should be allocated to the projects based on the proportional benefit. If a cost benefits two or more projects or activities in proportions that cannot be determined because of the interrelationship of the work involved, then the costs may be allocated or transferred to benefitted projects on any reasonable documented basis.” Condition – The Department has established program codes to allocate costs to both Federal and non-Federal programs. The allocation of the expenditures charged to these program codes is based on a combination of square footage and actual time reported on Federal and non-Federal programs. Department policies require rates to be updated quarterly. The rates were not updated quarterly after December 14, 2021, for the fiscal year ending June 30, 2022. Cause – The Department transitioned to a new payroll system and policies and procedures to identify time reporting requirements for staff and report capabilities were not in place to properly allocate costs. Effect – Allocable costs could be charged to the incorrect program code, resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should establish policies and procedures to properly allocate costs. In addition, the Department should review the allocable rates used during the period and determine if corrective disbursement entries are needed for all programs, including federal programs. Response and Corrective Action Planned – The Department will review allocable rates during the time frame to determine if corrective disbursement entries are need to their respective program codes. The Department will begin the process in October 2023. The Department will also revise, and update policies and procedures related to allocable costs based on time entries. Conclusion – Response accepted.
Allocable Costs Criteria – The Uniform Guidance, Part 200.405(a), states “A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. This standard is met if the cost: is incurred specifically for the Federal award; benefits both the Federal award and other work of the non-Federal entity and can be distributed in proportions that may be approximated using reasonable methods; and is necessary to the overall operation of the non-Federal entity and is assignable in part to the Federal award in accordance with the principles in this subpart.” Uniform Guidance, Part 200.405(a) states, “Direct cost allocation principles: If a cost benefits two or more projects or activities in proportions that can be determined without undue effort or cost, the cost should be allocated to the projects based on the proportional benefit. If a cost benefits two or more projects or activities in proportions that cannot be determined because of the interrelationship of the work involved, then the costs may be allocated or transferred to benefitted projects on any reasonable documented basis.” Condition – The Department has established program codes to allocate costs to both Federal and non-Federal programs. The allocation of the expenditures charged to these program codes is based on a combination of square footage and actual time reported on Federal and non-Federal programs. Department policies require rates to be updated quarterly. The rates were not updated quarterly after December 14, 2021, for the fiscal year ending June 30, 2022. Cause – The Department transitioned to a new payroll system and policies and procedures to identify time reporting requirements for staff and report capabilities were not in place to properly allocate costs. Effect – Allocable costs could be charged to the incorrect program code, resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should establish policies and procedures to properly allocate costs. In addition, the Department should review the allocable rates used during the period and determine if corrective disbursement entries are needed for all programs, including federal programs. Response and Corrective Action Planned – The Department will review allocable rates during the time frame to determine if corrective disbursement entries are need to their respective program codes. The Department will begin the process in October 2023. The Department will also revise, and update policies and procedures related to allocable costs based on time entries. Conclusion – Response accepted.
Allocable Costs Criteria – The Uniform Guidance, Part 200.405(a), states “A cost is allocable to a particular Federal award or other cost objective if the goods or services involved are chargeable or assignable to that Federal award or cost objective in accordance with relative benefits received. This standard is met if the cost: is incurred specifically for the Federal award; benefits both the Federal award and other work of the non-Federal entity and can be distributed in proportions that may be approximated using reasonable methods; and is necessary to the overall operation of the non-Federal entity and is assignable in part to the Federal award in accordance with the principles in this subpart.” Uniform Guidance, Part 200.405(a) states, “Direct cost allocation principles: If a cost benefits two or more projects or activities in proportions that can be determined without undue effort or cost, the cost should be allocated to the projects based on the proportional benefit. If a cost benefits two or more projects or activities in proportions that cannot be determined because of the interrelationship of the work involved, then the costs may be allocated or transferred to benefitted projects on any reasonable documented basis.” Condition – The Department has established program codes to allocate costs to both Federal and non-Federal programs. The allocation of the expenditures charged to these program codes is based on a combination of square footage and actual time reported on Federal and non-Federal programs. Department policies require rates to be updated quarterly. The rates were not updated quarterly after December 14, 2021, for the fiscal year ending June 30, 2022. Cause – The Department transitioned to a new payroll system and policies and procedures to identify time reporting requirements for staff and report capabilities were not in place to properly allocate costs. Effect – Allocable costs could be charged to the incorrect program code, resulting in allocating costs incorrectly to all programs, including federal programs. The effect on individual programs is undeterminable. Recommendation – The Department should establish policies and procedures to properly allocate costs. In addition, the Department should review the allocable rates used during the period and determine if corrective disbursement entries are needed for all programs, including federal programs. Response and Corrective Action Planned – The Department will review allocable rates during the time frame to determine if corrective disbursement entries are need to their respective program codes. The Department will begin the process in October 2023. The Department will also revise, and update policies and procedures related to allocable costs based on time entries. Conclusion – Response accepted.
IRS 940 Match Criteria – Uniform Guidance Compliance Supplement states, “States are required to annually certify for each taxpayer the total amount of contributions required to be paid under state law for the calendar year and the amounts and dates of such payments in order for the taxpayer to be allowed the credit against the FUTA (Federal Unemployment Tax Act) tax (26 CFR sections 31.3302(a)-3(a)). In order to accomplish this certification, states annually perform a match of employer tax payments with credit claimed for these payments on the employer’s IRS 940 FUTA tax form.” The Internal Revenue Service (IRS) sends the Department a secure file typically in October of each year following the prior calendar year. Taxes received for calendar year ending December 31, 2020, were received in October 2021. IWD must certify and respond to each Federal Employer Identification Number even if there is no discrepancy. The Department is also required to send back to the IRS the Federal Non-Filers file. This file lists all employers that filed with the state but did not file an IRS 940 FUTA tax form. Both the Certification file and the Non-Filers file must be sent back to the Internal Revenue Service by January 31, 2022. The Certification file is used to assign discrepancies to field auditors to determine the disposition of the discrepancy identified. The Department’s policy is designed to review each individual case within 180 days. Condition – The Department did not submit the Certification file by January 31, 2022. In addition, fourteen of fifty-four discrepancies were not resolved at the time of testing and thirty-three of fifty-four were not resolved until after 180 days. Cause – Due to a massive influx of claims beginning March of 2020 through December 2021, staff members from all bureaus, including investigations and field audit, were directed to assist with pandemic related claims. This included claims processing, answering phone calls on the customer service line and conducting two party fact-findings, and assisting in completing employer registrations. Because investigations staff were required to work these areas, normal investigations work, including monitoring the IRS 940 match report, was delayed. As a result, Iowa did not input the 2021 IRS 940 file into its system, so a match was not run, and workflows were not generated in order to create and send a certification file. Effect – The Department did not send the certification file by January 31, 2022, as required. In addition, discrepancies were not resolved in a timely manner. Recommendation – The Department should develop policies and procedures to ensure compliance with the IRS 940 match requirement and certify the amounts contributed annually by January 31. In addition, the Department should follow the established policies and procedures to ensure discrepancies are followed up within 180 days. Response and Corrective Action Planned – The Department will follow policies and procedures in place for fiscal year 2023, to certify the amounts contributed annually and ensure discrepancies are followed up within 180 days. Conclusion – Response accepted.
IRS 940 Match Criteria – Uniform Guidance Compliance Supplement states, “States are required to annually certify for each taxpayer the total amount of contributions required to be paid under state law for the calendar year and the amounts and dates of such payments in order for the taxpayer to be allowed the credit against the FUTA (Federal Unemployment Tax Act) tax (26 CFR sections 31.3302(a)-3(a)). In order to accomplish this certification, states annually perform a match of employer tax payments with credit claimed for these payments on the employer’s IRS 940 FUTA tax form.” The Internal Revenue Service (IRS) sends the Department a secure file typically in October of each year following the prior calendar year. Taxes received for calendar year ending December 31, 2020, were received in October 2021. IWD must certify and respond to each Federal Employer Identification Number even if there is no discrepancy. The Department is also required to send back to the IRS the Federal Non-Filers file. This file lists all employers that filed with the state but did not file an IRS 940 FUTA tax form. Both the Certification file and the Non-Filers file must be sent back to the Internal Revenue Service by January 31, 2022. The Certification file is used to assign discrepancies to field auditors to determine the disposition of the discrepancy identified. The Department’s policy is designed to review each individual case within 180 days. Condition – The Department did not submit the Certification file by January 31, 2022. In addition, fourteen of fifty-four discrepancies were not resolved at the time of testing and thirty-three of fifty-four were not resolved until after 180 days. Cause – Due to a massive influx of claims beginning March of 2020 through December 2021, staff members from all bureaus, including investigations and field audit, were directed to assist with pandemic related claims. This included claims processing, answering phone calls on the customer service line and conducting two party fact-findings, and assisting in completing employer registrations. Because investigations staff were required to work these areas, normal investigations work, including monitoring the IRS 940 match report, was delayed. As a result, Iowa did not input the 2021 IRS 940 file into its system, so a match was not run, and workflows were not generated in order to create and send a certification file. Effect – The Department did not send the certification file by January 31, 2022, as required. In addition, discrepancies were not resolved in a timely manner. Recommendation – The Department should develop policies and procedures to ensure compliance with the IRS 940 match requirement and certify the amounts contributed annually by January 31. In addition, the Department should follow the established policies and procedures to ensure discrepancies are followed up within 180 days. Response and Corrective Action Planned – The Department will follow policies and procedures in place for fiscal year 2023, to certify the amounts contributed annually and ensure discrepancies are followed up within 180 days. Conclusion – Response accepted.
Cash Management Improvement Act Criteria – Effective cash management procedures provide for minimizing the amount of time between the drawdown/request for federal funds and the disbursement of those funds by the Department. Effective cash management also minimizes the amount of state and other federal funds used to supplant programs until federal funds are received. Generally, a maximum of three days is considered acceptable between the receipt of federal funds and the disbursement of those funds. Condition – A review of the Department’s records identified cash balances averaged approximately $28.5 million and were greater than a significant amount of approximately $9.5 million for the fiscal year. Cause – Although procedures have been established to draw federal funds only in amounts sufficient to cover current needs, the Department did not review or update procedures to account for federal draws associated with pandemic related administrative programs and unemployment benefits. Effect – Failure to follow procedures resulted in Department employees not detecting the error in the normal course of performing their assigned duties. Recommendation – The Department should follow established procedures to ensure federal funds are drawn only in amounts sufficient to cover current needs and are disbursed in a timely manner without carrying excessive daily balances. Response and Corrective Action Planned – The Department implemented a revised cash management policy for federal programs. Included in the policy and procedure are reviews of ledger activity, instances in which federal programs reflect excess cash on hand and immediate review of the programs revenues and expenditures is performed. In addition, federal funds drawn that exceed defined thresholds require additional approval from the Accounting and Finance Bureau Chiefs and or the Department’s Chief Financial Officer. Conclusion – Response accepted.
Cash Management Improvement Act Criteria – Effective cash management procedures provide for minimizing the amount of time between the drawdown/request for federal funds and the disbursement of those funds by the Department. Effective cash management also minimizes the amount of state and other federal funds used to supplant programs until federal funds are received. Generally, a maximum of three days is considered acceptable between the receipt of federal funds and the disbursement of those funds. Condition – A review of the Department’s records identified cash balances averaged approximately $28.5 million and were greater than a significant amount of approximately $9.5 million for the fiscal year. Cause – Although procedures have been established to draw federal funds only in amounts sufficient to cover current needs, the Department did not review or update procedures to account for federal draws associated with pandemic related administrative programs and unemployment benefits. Effect – Failure to follow procedures resulted in Department employees not detecting the error in the normal course of performing their assigned duties. Recommendation – The Department should follow established procedures to ensure federal funds are drawn only in amounts sufficient to cover current needs and are disbursed in a timely manner without carrying excessive daily balances. Response and Corrective Action Planned – The Department implemented a revised cash management policy for federal programs. Included in the policy and procedure are reviews of ledger activity, instances in which federal programs reflect excess cash on hand and immediate review of the programs revenues and expenditures is performed. In addition, federal funds drawn that exceed defined thresholds require additional approval from the Accounting and Finance Bureau Chiefs and or the Department’s Chief Financial Officer. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations, and the terms of the federal award. The ETA 9130, Financial Status Report, UI Program, “Employment Service and Unemployment Insurance Programs”, is the quarterly summary of program and administrative expenditures. All ETA grantees are required to submit quarterly financial reports for each grant award, including standard program and pilot, demonstration, and evaluation projects. A separate ETA 9130 is submitted for each of the following: Unemployment Insurance, Pandemic Emergency Unemployment Compensation, Pandemic Unemployment Assistance Administration, Trade Adjustment Assistance/Reemployment Trade Adjustment Assistance and UI Projects. U.S. Department of Labor Employment and Training Administration Financial Report Instructions requires the report to be submitted electronically no later than 45 calendar days after each specified reporting period. A closeout report is required to be submitted no later than 90 calendar days after the grant end date. Condition – Six of eleven reports tested were not independently reviewed and one report was submitted five days late. Cause – Although procedures have been established to require independent review and approval of the ETA 9130 reports be documented and retained, this review was not always documented. In addition, Department procedures have not been established to ensure reports are submitted timely. Effect – The lack of a documented review of the ETA 9130 reports increases the risk for undetected reporting errors or misstatements. In addition, the lack of established policies and procedures resulted in the late submission of one quarterly report. Recommendation – The Department should follow the established policies and procedures to ensure reports are independently reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. In addition, the Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. Response and Corrective Action Planned – The Department has implemented a procedure to ensure ETA 9130 reports are filed timely and evidence of review is present on supporting documentation. Effective March 31, 2023, U.S. Department of Labor transitioned ETA 9130 reporting to Payment Management System, a feature of this is automatic logging of a user’s identify for submittal and users identify for grantee certification. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations, and the terms of the federal award. The ETA 9130, Financial Status Report, UI Program, “Employment Service and Unemployment Insurance Programs”, is the quarterly summary of program and administrative expenditures. All ETA grantees are required to submit quarterly financial reports for each grant award, including standard program and pilot, demonstration, and evaluation projects. A separate ETA 9130 is submitted for each of the following: Unemployment Insurance, Pandemic Emergency Unemployment Compensation, Pandemic Unemployment Assistance Administration, Trade Adjustment Assistance/Reemployment Trade Adjustment Assistance and UI Projects. U.S. Department of Labor Employment and Training Administration Financial Report Instructions requires the report to be submitted electronically no later than 45 calendar days after each specified reporting period. A closeout report is required to be submitted no later than 90 calendar days after the grant end date. Condition – Six of eleven reports tested were not independently reviewed and one report was submitted five days late. Cause – Although procedures have been established to require independent review and approval of the ETA 9130 reports be documented and retained, this review was not always documented. In addition, Department procedures have not been established to ensure reports are submitted timely. Effect – The lack of a documented review of the ETA 9130 reports increases the risk for undetected reporting errors or misstatements. In addition, the lack of established policies and procedures resulted in the late submission of one quarterly report. Recommendation – The Department should follow the established policies and procedures to ensure reports are independently reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. In addition, the Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. Response and Corrective Action Planned – The Department has implemented a procedure to ensure ETA 9130 reports are filed timely and evidence of review is present on supporting documentation. Effective March 31, 2023, U.S. Department of Labor transitioned ETA 9130 reporting to Payment Management System, a feature of this is automatic logging of a user’s identify for submittal and users identify for grantee certification. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The ETA 191 report, “Statement of Expenditures and Financial Adjustments of Federal Funds for Unemployment Compensation for Federal Employees and Ex-Service members”, is the quarterly summary of unemployment compensation expenditures and adjustments and the total amount of benefits paid to claimants of each federal and military agency. Unemployment Insurance (UI) Reports Handbook No. 401 requires the report to be submitted electronically to the Employment and Training Administration of the U.S. Department of Labor by the 25th of the month following the close of the quarter. Condition – Two of the four quarterly reports were submitted between one and eight days late. Cause – Department procedures were not established in fiscal year 2022 to ensure reports are submitted timely. The Department also utilizes a database to identify unemployment compensation paid to Federal Employees and Ex-Service members. For the June 2022 ETA 191, the database was not available to the Department until after the ETA 191’s due date. Effect – The lack of established policies and procedures resulted in the late submission of quarterly reports. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. Response and Corrective Action Planned – A policy and procedure has been established for reporting and filing the ETA 191. Included in the procedure is a requirement to submit the report to the Chief Financial Officer for review and approval. Evidence of review and transmittal is documented via email confirmation to the Accountant 3 responsible for preparing the ETA 191. Review and approval of the ETA 191 is required to be completed prior to the reports due date. After transmittal to DOL of the ETA 191; a copy with supporting documentation is made available to the Unemployment Division Administrator. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The ETA 191 report, “Statement of Expenditures and Financial Adjustments of Federal Funds for Unemployment Compensation for Federal Employees and Ex-Service members”, is the quarterly summary of unemployment compensation expenditures and adjustments and the total amount of benefits paid to claimants of each federal and military agency. Unemployment Insurance (UI) Reports Handbook No. 401 requires the report to be submitted electronically to the Employment and Training Administration of the U.S. Department of Labor by the 25th of the month following the close of the quarter. Condition – Two of the four quarterly reports were submitted between one and eight days late. Cause – Department procedures were not established in fiscal year 2022 to ensure reports are submitted timely. The Department also utilizes a database to identify unemployment compensation paid to Federal Employees and Ex-Service members. For the June 2022 ETA 191, the database was not available to the Department until after the ETA 191’s due date. Effect – The lack of established policies and procedures resulted in the late submission of quarterly reports. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. Response and Corrective Action Planned – A policy and procedure has been established for reporting and filing the ETA 191. Included in the procedure is a requirement to submit the report to the Chief Financial Officer for review and approval. Evidence of review and transmittal is documented via email confirmation to the Accountant 3 responsible for preparing the ETA 191. Review and approval of the ETA 191 is required to be completed prior to the reports due date. After transmittal to DOL of the ETA 191; a copy with supporting documentation is made available to the Unemployment Division Administrator. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the auditee establish and maintain effective internal control over the federal award which provides reasonable assurance the auditee is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The ETA 9050 report, “Time Lapse of All First Payments Except Workshare”, provides information on the time it takes, states to pay benefits to claimants for the first compensable week of unemployment. The ETA 9052 report, “Nonmonetary Determination Time Lapse Detection”, provides information on the time it takes, states to issue nonmonetary determinations from the date the issues are first detected by the agency. The ETA 9055 report, “Appeals Case Aging”, provides information on the inventory of lower authority and higher authority single claimant appeals cases that have been filed but not decided. Appeals case aging provides information about the number of days from the date an appeal was filed through the end of the month covered by the report. Also included are the average and median ages of the pending single claimant appeals cases. The UI Reports Handbook No. 401 requires the reports to be submitted on the 20th of the month following the month to which the data relates. Condition – Supporting documentation for the monthly reports was not retained. Reports submitted were not reviewed and approved by an independent person for propriety prior to submission. Cause – Department procedures have not been established to retain supporting documentation for the data fields in the report. In addition, Department procedures have not been established to require documentation the reports were independently reviewed and approved. Effect – The lack of supporting documentation and a documented review of these reports increases the risk for undetected reporting errors or misstatements. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely and the support for the preparation of the report is retained. The policies established should also ensure the quarterly reports are reviewed and approved by an independent person who is knowledgeable about the program and are submitted by the due date. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – Procedures have been established for transmitting the ETA 9050, 9052 and 9055 reports. Included in the procedures are where to retain the supporting data file and review of the report by the Division Administrator or Deputy Division Administrator prior to final transmission. The report must be returned with a signature and date prior to submitting the finalized reports to the Department of Labor within the reporting deadline. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the auditee establish and maintain effective internal control over the federal award which provides reasonable assurance the auditee is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The ETA 9050 report, “Time Lapse of All First Payments Except Workshare”, provides information on the time it takes, states to pay benefits to claimants for the first compensable week of unemployment. The ETA 9052 report, “Nonmonetary Determination Time Lapse Detection”, provides information on the time it takes, states to issue nonmonetary determinations from the date the issues are first detected by the agency. The ETA 9055 report, “Appeals Case Aging”, provides information on the inventory of lower authority and higher authority single claimant appeals cases that have been filed but not decided. Appeals case aging provides information about the number of days from the date an appeal was filed through the end of the month covered by the report. Also included are the average and median ages of the pending single claimant appeals cases. The UI Reports Handbook No. 401 requires the reports to be submitted on the 20th of the month following the month to which the data relates. Condition – Supporting documentation for the monthly reports was not retained. Reports submitted were not reviewed and approved by an independent person for propriety prior to submission. Cause – Department procedures have not been established to retain supporting documentation for the data fields in the report. In addition, Department procedures have not been established to require documentation the reports were independently reviewed and approved. Effect – The lack of supporting documentation and a documented review of these reports increases the risk for undetected reporting errors or misstatements. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely and the support for the preparation of the report is retained. The policies established should also ensure the quarterly reports are reviewed and approved by an independent person who is knowledgeable about the program and are submitted by the due date. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – Procedures have been established for transmitting the ETA 9050, 9052 and 9055 reports. Included in the procedures are where to retain the supporting data file and review of the report by the Division Administrator or Deputy Division Administrator prior to final transmission. The report must be returned with a signature and date prior to submitting the finalized reports to the Department of Labor within the reporting deadline. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the auditee establish and maintain effective internal control over the federal award which provides reasonable assurance the auditee is managing the federal award in compliance with federal statutes, regulation and the terms of the federal award. The ETA 2208A report, “Quarterly UI Contingency Report”, provides information on the number of staff years worked and paid for various UI program categories, and provides the basis for determining above-base entitlements. UI Reports Handbook No. 336 requires the report to be submitted electronically for each calendar quarter to the Employment and Training Administration of the U.S. Department of Labor within 30 days after the end of the reporting quarter to which it relates. Condition – Three of four quarterly reports were submitted between one and nineteen days late. In addition, the Department indicated the reports submitted were reviewed and approved; however, we determined this review was not documented for one of four quarterly reports. Cause – Department procedures have not been established to ensure reports are submitted timely and to require the independent review and approval of the reports be documented. Effect – The lack of a documented review of these reports increases the risk for undetected reporting errors or misstatements. In addition, the lack of established policies and procedures resulted in the late submission of the three reports. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. The policies established should also ensure the quarterly reports are reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – A policy and procedures will be established for the quarter ending September 30, 2023, to ensure evidence of an independent review is documented by the reviewer’s and date of the review prior to submission, within the reporting deadline. The ETA 2208A report will be reviewed by the Chief Financial Officer and will be evidenced by email approval prior to any future ETA 2208A submissions to the ETA. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the auditee establish and maintain effective internal control over the federal award which provides reasonable assurance the auditee is managing the federal award in compliance with federal statutes, regulation and the terms of the federal award. The ETA 2208A report, “Quarterly UI Contingency Report”, provides information on the number of staff years worked and paid for various UI program categories, and provides the basis for determining above-base entitlements. UI Reports Handbook No. 336 requires the report to be submitted electronically for each calendar quarter to the Employment and Training Administration of the U.S. Department of Labor within 30 days after the end of the reporting quarter to which it relates. Condition – Three of four quarterly reports were submitted between one and nineteen days late. In addition, the Department indicated the reports submitted were reviewed and approved; however, we determined this review was not documented for one of four quarterly reports. Cause – Department procedures have not been established to ensure reports are submitted timely and to require the independent review and approval of the reports be documented. Effect – The lack of a documented review of these reports increases the risk for undetected reporting errors or misstatements. In addition, the lack of established policies and procedures resulted in the late submission of the three reports. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. The policies established should also ensure the quarterly reports are reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – A policy and procedures will be established for the quarter ending September 30, 2023, to ensure evidence of an independent review is documented by the reviewer’s and date of the review prior to submission, within the reporting deadline. The ETA 2208A report will be reviewed by the Chief Financial Officer and will be evidenced by email approval prior to any future ETA 2208A submissions to the ETA. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the auditee establish and maintain effective internal control over the federal award which provides reasonable assurance the auditee is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The ETA 9130, Financial Status Report, is the quarterly summary of program and administrative expenditures. All ETA grantees are required to submit quarterly financial reports for each grant award which they operate, including standard program and pilot, demonstration and evaluation projects. U.S. Department of Labor Employment and Training Administration Financial Report Instructions requires the report to be submitted electronically no later than 45 calendar days after each specified reporting period. A closeout report is required to be submitted no later than 90 calendar days after the grant end date. Condition – For 20 of 33 reports tested, reports were submitted between one and four days late. None of the 33 reports tested were independently reviewed. In addition, for 15 of the 33 reports tested total expenditures did not agree with the state’s accounting system. In total the reports were understated $1,047,345, with ranges of an overstatement of $54,130 to an understatement of $382,430. For 11 of the 33 reports tested, administration expenditures did not agree with the state’s accounting system. In total, the reports were understated $240,290, with ranges of an overstatement of $19,456 to an understatement of $146,606. Cause – The Department did not ensure the reconciliation of the state accounting system by program was performed, or the ETA 9130 reports were independently reviewed, were supported and documentation was retained. Effect – The lack of a documented review of the ETA 9130 reports increases the risk for undetected reporting errors or misstatements. In addition, the lack of established policies and procedures resulted in late submission of quarterly reports and reporting errors. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. In addition, the Department should establish policies and procedures to ensure reports are reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Also, the Department should ensure expenditures are properly reported and a reconciliation to the state accounting system is performed. Response and Corrective Action Planned – The Department has implemented a procedure to ensure ETA 9130 reports are filed timely and evidence of review is present on supporting documentation. Effective March 31, 2023, U.S. Department of Labor transitioned ETA 9130 reporting to Payment Management System, a feature of this is automatic logging of a user’s identify for submittal and users identify for grantee certification. Specific to WIOA Title I programs, the department is reviewing procedures related to WIOA ETA 9130 filings, including reconciliation requirements of the WIOA Title I program, and reporting obligations and accruals. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the auditee establish and maintain effective internal control over the federal award which provides reasonable assurance the auditee is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The ETA 9130, Financial Status Report, is the quarterly summary of program and administrative expenditures. All ETA grantees are required to submit quarterly financial reports for each grant award which they operate, including standard program and pilot, demonstration and evaluation projects. U.S. Department of Labor Employment and Training Administration Financial Report Instructions requires the report to be submitted electronically no later than 45 calendar days after each specified reporting period. A closeout report is required to be submitted no later than 90 calendar days after the grant end date. Condition – For 20 of 33 reports tested, reports were submitted between one and four days late. None of the 33 reports tested were independently reviewed. In addition, for 15 of the 33 reports tested total expenditures did not agree with the state’s accounting system. In total the reports were understated $1,047,345, with ranges of an overstatement of $54,130 to an understatement of $382,430. For 11 of the 33 reports tested, administration expenditures did not agree with the state’s accounting system. In total, the reports were understated $240,290, with ranges of an overstatement of $19,456 to an understatement of $146,606. Cause – The Department did not ensure the reconciliation of the state accounting system by program was performed, or the ETA 9130 reports were independently reviewed, were supported and documentation was retained. Effect – The lack of a documented review of the ETA 9130 reports increases the risk for undetected reporting errors or misstatements. In addition, the lack of established policies and procedures resulted in late submission of quarterly reports and reporting errors. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. In addition, the Department should establish policies and procedures to ensure reports are reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Also, the Department should ensure expenditures are properly reported and a reconciliation to the state accounting system is performed. Response and Corrective Action Planned – The Department has implemented a procedure to ensure ETA 9130 reports are filed timely and evidence of review is present on supporting documentation. Effective March 31, 2023, U.S. Department of Labor transitioned ETA 9130 reporting to Payment Management System, a feature of this is automatic logging of a user’s identify for submittal and users identify for grantee certification. Specific to WIOA Title I programs, the department is reviewing procedures related to WIOA ETA 9130 filings, including reconciliation requirements of the WIOA Title I program, and reporting obligations and accruals. Conclusion – Response accepted.
Employment and Training Administration (ETA) Reports Criteria – The Uniform Guidance, Part 200.303, requires the auditee establish and maintain effective internal control over the federal award which provides reasonable assurance the auditee is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The ETA 9130, Financial Status Report, is the quarterly summary of program and administrative expenditures. All ETA grantees are required to submit quarterly financial reports for each grant award which they operate, including standard program and pilot, demonstration and evaluation projects. U.S. Department of Labor Employment and Training Administration Financial Report Instructions requires the report to be submitted electronically no later than 45 calendar days after each specified reporting period. A closeout report is required to be submitted no later than 90 calendar days after the grant end date. Condition – For 20 of 33 reports tested, reports were submitted between one and four days late. None of the 33 reports tested were independently reviewed. In addition, for 15 of the 33 reports tested total expenditures did not agree with the state’s accounting system. In total the reports were understated $1,047,345, with ranges of an overstatement of $54,130 to an understatement of $382,430. For 11 of the 33 reports tested, administration expenditures did not agree with the state’s accounting system. In total, the reports were understated $240,290, with ranges of an overstatement of $19,456 to an understatement of $146,606. Cause – The Department did not ensure the reconciliation of the state accounting system by program was performed, or the ETA 9130 reports were independently reviewed, were supported and documentation was retained. Effect – The lack of a documented review of the ETA 9130 reports increases the risk for undetected reporting errors or misstatements. In addition, the lack of established policies and procedures resulted in late submission of quarterly reports and reporting errors. Recommendation – The Department should establish policies and procedures to ensure reports are submitted timely in accordance with UI Reports Handbook. In addition, the Department should establish policies and procedures to ensure reports are reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Also, the Department should ensure expenditures are properly reported and a reconciliation to the state accounting system is performed. Response and Corrective Action Planned – The Department has implemented a procedure to ensure ETA 9130 reports are filed timely and evidence of review is present on supporting documentation. Effective March 31, 2023, U.S. Department of Labor transitioned ETA 9130 reporting to Payment Management System, a feature of this is automatic logging of a user’s identify for submittal and users identify for grantee certification. Specific to WIOA Title I programs, the department is reviewing procedures related to WIOA ETA 9130 filings, including reconciliation requirements of the WIOA Title I program, and reporting obligations and accruals. Conclusion – Response accepted.
WIOA Participant Individual Record Layout (PIRL) Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The PIRL provides a streamlined data collection on the Workforce Innovation and Opportunity Act (WIOA) program activities and outcomes into a single streamlined reporting structure. The report captures information related to WIOA applicants, including WIOA participants who receive benefits and services across the program with a standardized set of data elements which includes information on participant demographics, types of services received and performance outcomes. The PIRL is intended to track information on WIOA activity on a “real time” basis for individuals from the point of WIOA eligibility determination through post-participation outcomes. Quarterly reports are to be submitted no later than 45 days after the end of each report quarter. Condition – The PIRL report independent review was not documented. Cause – Department procedures have not been established to require independent review and approval of the reports be documented. Effect – The lack of a documented review of these reports increases the risk for undetected reporting errors or misstatements. Recommendation – The Department should establish policies and procedures to ensure the quarterly reports are reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – We understand the Auditor's Office requirement for independent review. The same one file (PIRL file) includes multiple programs that includes but is not limited to Title I Adult, Dislocated Worker and Youth, Trade, etc. The State does do a formal Independent Review for the Trade program each quarter and many of these records are co-enrolled and include the same data elements for review. These are part of the same submission file (Trade and Title I are in the same PIRL file.) The State has also provided that numerous reviews of data do take place throughout each quarter and on an ongoing basis to include our data element validation process to ensure accurate reporting to the Department of Labor. The Department will receive the PIRL file and will ensure an independent review of the WIOA Title I related data elements is completed prior to submission. This review will be completed by a knowledgeable, independent staff person(s) by pulling a random sample of participants and reviewing the correct time frames and data elements are included in the file. After review, the independent reviewer will indicate evidence of the review through an electronic sign off using system tools of the random sample. This will ensure our data management system goals to improve efficiency and move toward a fully electronic system and record keeping. Conclusion – Response accepted.
WIOA Participant Individual Record Layout (PIRL) Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The PIRL provides a streamlined data collection on the Workforce Innovation and Opportunity Act (WIOA) program activities and outcomes into a single streamlined reporting structure. The report captures information related to WIOA applicants, including WIOA participants who receive benefits and services across the program with a standardized set of data elements which includes information on participant demographics, types of services received and performance outcomes. The PIRL is intended to track information on WIOA activity on a “real time” basis for individuals from the point of WIOA eligibility determination through post-participation outcomes. Quarterly reports are to be submitted no later than 45 days after the end of each report quarter. Condition – The PIRL report independent review was not documented. Cause – Department procedures have not been established to require independent review and approval of the reports be documented. Effect – The lack of a documented review of these reports increases the risk for undetected reporting errors or misstatements. Recommendation – The Department should establish policies and procedures to ensure the quarterly reports are reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – We understand the Auditor's Office requirement for independent review. The same one file (PIRL file) includes multiple programs that includes but is not limited to Title I Adult, Dislocated Worker and Youth, Trade, etc. The State does do a formal Independent Review for the Trade program each quarter and many of these records are co-enrolled and include the same data elements for review. These are part of the same submission file (Trade and Title I are in the same PIRL file.) The State has also provided that numerous reviews of data do take place throughout each quarter and on an ongoing basis to include our data element validation process to ensure accurate reporting to the Department of Labor. The Department will receive the PIRL file and will ensure an independent review of the WIOA Title I related data elements is completed prior to submission. This review will be completed by a knowledgeable, independent staff person(s) by pulling a random sample of participants and reviewing the correct time frames and data elements are included in the file. After review, the independent reviewer will indicate evidence of the review through an electronic sign off using system tools of the random sample. This will ensure our data management system goals to improve efficiency and move toward a fully electronic system and record keeping. Conclusion – Response accepted.
WIOA Participant Individual Record Layout (PIRL) Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. The PIRL provides a streamlined data collection on the Workforce Innovation and Opportunity Act (WIOA) program activities and outcomes into a single streamlined reporting structure. The report captures information related to WIOA applicants, including WIOA participants who receive benefits and services across the program with a standardized set of data elements which includes information on participant demographics, types of services received and performance outcomes. The PIRL is intended to track information on WIOA activity on a “real time” basis for individuals from the point of WIOA eligibility determination through post-participation outcomes. Quarterly reports are to be submitted no later than 45 days after the end of each report quarter. Condition – The PIRL report independent review was not documented. Cause – Department procedures have not been established to require independent review and approval of the reports be documented. Effect – The lack of a documented review of these reports increases the risk for undetected reporting errors or misstatements. Recommendation – The Department should establish policies and procedures to ensure the quarterly reports are reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – We understand the Auditor's Office requirement for independent review. The same one file (PIRL file) includes multiple programs that includes but is not limited to Title I Adult, Dislocated Worker and Youth, Trade, etc. The State does do a formal Independent Review for the Trade program each quarter and many of these records are co-enrolled and include the same data elements for review. These are part of the same submission file (Trade and Title I are in the same PIRL file.) The State has also provided that numerous reviews of data do take place throughout each quarter and on an ongoing basis to include our data element validation process to ensure accurate reporting to the Department of Labor. The Department will receive the PIRL file and will ensure an independent review of the WIOA Title I related data elements is completed prior to submission. This review will be completed by a knowledgeable, independent staff person(s) by pulling a random sample of participants and reviewing the correct time frames and data elements are included in the file. After review, the independent reviewer will indicate evidence of the review through an electronic sign off using system tools of the random sample. This will ensure our data management system goals to improve efficiency and move toward a fully electronic system and record keeping. Conclusion – Response accepted.
Federal Funding Accountability and Transparency Act Reporting Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. Under the requirements of the Federal Funding Accountability and Transparency Act (Pub. L. No. 109-282), as amended by Section 6202 of Pub. L. No. 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Condition – The Department did not report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS) for WIOA Cluster subrecipients. Cause – The Department was unaware of the requirement until it was brought to their attention. Effect – The Department was not in compliance with report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Recommendation – The Department should establish policies and procedures to ensure first-tier subawards of $30,000 or more are reported to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Policies and procedures should ensure the reporting is reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – The Department will establish policies and procedures to ensure first-tier subawards of $30,000 or more are reported to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Policies and procedures will ensure the reporting is reviewed and approved by an independent person who is knowledgeable about the program. This independent review will be documented by the reviewer’s signature or initials and date of review prior to submission. The Department plans to begin this process in October 2023. Conclusion – Response accepted.
Federal Funding Accountability and Transparency Act Reporting Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. Under the requirements of the Federal Funding Accountability and Transparency Act (Pub. L. No. 109-282), as amended by Section 6202 of Pub. L. No. 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Condition – The Department did not report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS) for WIOA Cluster subrecipients. Cause – The Department was unaware of the requirement until it was brought to their attention. Effect – The Department was not in compliance with report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Recommendation – The Department should establish policies and procedures to ensure first-tier subawards of $30,000 or more are reported to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Policies and procedures should ensure the reporting is reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – The Department will establish policies and procedures to ensure first-tier subawards of $30,000 or more are reported to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Policies and procedures will ensure the reporting is reviewed and approved by an independent person who is knowledgeable about the program. This independent review will be documented by the reviewer’s signature or initials and date of review prior to submission. The Department plans to begin this process in October 2023. Conclusion – Response accepted.
Federal Funding Accountability and Transparency Act Reporting Criteria – The Uniform Guidance, Part 200.303, requires the Department establish and maintain effective internal control over the federal award which provides reasonable assurance the Department is managing the federal award in compliance with federal statutes, regulations and the terms of the federal award. Under the requirements of the Federal Funding Accountability and Transparency Act (Pub. L. No. 109-282), as amended by Section 6202 of Pub. L. No. 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Condition – The Department did not report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS) for WIOA Cluster subrecipients. Cause – The Department was unaware of the requirement until it was brought to their attention. Effect – The Department was not in compliance with report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Recommendation – The Department should establish policies and procedures to ensure first-tier subawards of $30,000 or more are reported to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Policies and procedures should ensure the reporting is reviewed and approved by an independent person who is knowledgeable about the program. This independent review should be documented by the reviewer’s signature or initials and date of review prior to submission. Response and Corrective Action Planned – The Department will establish policies and procedures to ensure first-tier subawards of $30,000 or more are reported to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Policies and procedures will ensure the reporting is reviewed and approved by an independent person who is knowledgeable about the program. This independent review will be documented by the reviewer’s signature or initials and date of review prior to submission. The Department plans to begin this process in October 2023. Conclusion – Response accepted.
Awards to Subrecipients Criteria – The Uniform Guidance, Part 200.332 states, “All pass-through entities must: ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward.” Required information includes identification of whether the award is research and development (R&D) and the indirect cost rate for the federal award (including if the de minimis rate is charged) per Part 200.414. Condition – For subawards the Department did not include identification of whether the award is R&D or the indirect cost rate for the federal award (including if the de minimis rate is charged) per Part 200.414. Cause – The Department has not established policies and procedures to ensure all required information is included in the subaward to the subrecipients. Effect – The information required in the subaward to subrecipients was not included due to the lack of policies and procedures. Recommendation – The Department should establish policies and procedures to ensure all required information is included in the subaward to subrecipients as required by Uniform Guidance, Part 200.332. Response and Corrective Action Planned – Effective October, 2023; new sub-awards and pass thru grant agreements will have elements specified in the respective agreement as required by Uniform Guidance, Part 200.332. Conclusion – Response accepted.
Awards to Subrecipients Criteria – The Uniform Guidance, Part 200.332 states, “All pass-through entities must: ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward.” Required information includes identification of whether the award is research and development (R&D) and the indirect cost rate for the federal award (including if the de minimis rate is charged) per Part 200.414. Condition – For subawards the Department did not include identification of whether the award is R&D or the indirect cost rate for the federal award (including if the de minimis rate is charged) per Part 200.414. Cause – The Department has not established policies and procedures to ensure all required information is included in the subaward to the subrecipients. Effect – The information required in the subaward to subrecipients was not included due to the lack of policies and procedures. Recommendation – The Department should establish policies and procedures to ensure all required information is included in the subaward to subrecipients as required by Uniform Guidance, Part 200.332. Response and Corrective Action Planned – Effective October, 2023; new sub-awards and pass thru grant agreements will have elements specified in the respective agreement as required by Uniform Guidance, Part 200.332. Conclusion – Response accepted.
Awards to Subrecipients Criteria – The Uniform Guidance, Part 200.332 states, “All pass-through entities must: ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward.” Required information includes identification of whether the award is research and development (R&D) and the indirect cost rate for the federal award (including if the de minimis rate is charged) per Part 200.414. Condition – For subawards the Department did not include identification of whether the award is R&D or the indirect cost rate for the federal award (including if the de minimis rate is charged) per Part 200.414. Cause – The Department has not established policies and procedures to ensure all required information is included in the subaward to the subrecipients. Effect – The information required in the subaward to subrecipients was not included due to the lack of policies and procedures. Recommendation – The Department should establish policies and procedures to ensure all required information is included in the subaward to subrecipients as required by Uniform Guidance, Part 200.332. Response and Corrective Action Planned – Effective October, 2023; new sub-awards and pass thru grant agreements will have elements specified in the respective agreement as required by Uniform Guidance, Part 200.332. Conclusion – Response accepted.
Subrecipient Monitoring Criteria – The Uniform Guidance, Part 200.332 states in part, “All pass-through entities must: evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring.” The Uniform Guidance, Part 200.332 also states, “All pass-through entities must: monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Pass-through entity monitoring of the subrecipient must include reviewing financial and performance reports required by the pass-through entity, following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the Federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and written confirmation from the subrecipient, highlighting the status of actions planned or taken to address Single Audit findings related to the particular subaward and issuing a management decision for applicable audit findings pertaining only to the Federal award provided to the subrecipient from the pass-through entity as required by Part 200.521.” The Uniform Guidance, Part 200.332 also states, “All pass-through entities must: Verify that every subrecipient is audited as required by Subpart F when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in Part 200.501.” and that “All pass-through entities must: consider whether the results of the subrecipient's audits, on-site reviews, or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records.” Condition – The Department did not perform financial monitoring for eight of nine subrecipients tested. For the eight where financial monitoring was not performed, we identified the following: The Department did not evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. The Department did not monitor the activities of the subrecipient to ensure the subaward was used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward. The Department did not verify that every subrecipient is audited as required by Subpart F when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in Part 200.501. The Department did not consider whether the results of the subrecipient's audits, on-site reviews or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records. Cause – The Department has not established policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332. Effect – The Department is not in compliance with subrecipient monitoring as required by the Uniform Guidance, Part 200.332. Recommendation – The Department should establish policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332. Response and Corrective Action Planned – The Department established policies and procedures to perform financial subrecipient monitoring for subawards related to WIOA and began that process in May of 2023. The Department is also enhancing its fiscal review process starting with funding requests from sub-recipients and partnering with WIOA Title I program staff to identify areas of risk. The monitoring will be performed to ensure compliance with WIOA and Uniform Guidance, Part 200.332. Conclusion – Response accepted.
Subrecipient Monitoring Criteria – The Uniform Guidance, Part 200.332 states in part, “All pass-through entities must: evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring.” The Uniform Guidance, Part 200.332 also states, “All pass-through entities must: monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Pass-through entity monitoring of the subrecipient must include reviewing financial and performance reports required by the pass-through entity, following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the Federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and written confirmation from the subrecipient, highlighting the status of actions planned or taken to address Single Audit findings related to the particular subaward and issuing a management decision for applicable audit findings pertaining only to the Federal award provided to the subrecipient from the pass-through entity as required by Part 200.521.” The Uniform Guidance, Part 200.332 also states, “All pass-through entities must: Verify that every subrecipient is audited as required by Subpart F when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in Part 200.501.” and that “All pass-through entities must: consider whether the results of the subrecipient's audits, on-site reviews, or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records.” Condition – The Department did not perform financial monitoring for eight of nine subrecipients tested. For the eight where financial monitoring was not performed, we identified the following: The Department did not evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. The Department did not monitor the activities of the subrecipient to ensure the subaward was used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward. The Department did not verify that every subrecipient is audited as required by Subpart F when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in Part 200.501. The Department did not consider whether the results of the subrecipient's audits, on-site reviews or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records. Cause – The Department has not established policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332. Effect – The Department is not in compliance with subrecipient monitoring as required by the Uniform Guidance, Part 200.332. Recommendation – The Department should establish policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332. Response and Corrective Action Planned – The Department established policies and procedures to perform financial subrecipient monitoring for subawards related to WIOA and began that process in May of 2023. The Department is also enhancing its fiscal review process starting with funding requests from sub-recipients and partnering with WIOA Title I program staff to identify areas of risk. The monitoring will be performed to ensure compliance with WIOA and Uniform Guidance, Part 200.332. Conclusion – Response accepted.
Subrecipient Monitoring Criteria – The Uniform Guidance, Part 200.332 states in part, “All pass-through entities must: evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring.” The Uniform Guidance, Part 200.332 also states, “All pass-through entities must: monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Pass-through entity monitoring of the subrecipient must include reviewing financial and performance reports required by the pass-through entity, following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the Federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and written confirmation from the subrecipient, highlighting the status of actions planned or taken to address Single Audit findings related to the particular subaward and issuing a management decision for applicable audit findings pertaining only to the Federal award provided to the subrecipient from the pass-through entity as required by Part 200.521.” The Uniform Guidance, Part 200.332 also states, “All pass-through entities must: Verify that every subrecipient is audited as required by Subpart F when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in Part 200.501.” and that “All pass-through entities must: consider whether the results of the subrecipient's audits, on-site reviews, or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records.” Condition – The Department did not perform financial monitoring for eight of nine subrecipients tested. For the eight where financial monitoring was not performed, we identified the following: The Department did not evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. The Department did not monitor the activities of the subrecipient to ensure the subaward was used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward. The Department did not verify that every subrecipient is audited as required by Subpart F when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in Part 200.501. The Department did not consider whether the results of the subrecipient's audits, on-site reviews or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records. Cause – The Department has not established policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332. Effect – The Department is not in compliance with subrecipient monitoring as required by the Uniform Guidance, Part 200.332. Recommendation – The Department should establish policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332. Response and Corrective Action Planned – The Department established policies and procedures to perform financial subrecipient monitoring for subawards related to WIOA and began that process in May of 2023. The Department is also enhancing its fiscal review process starting with funding requests from sub-recipients and partnering with WIOA Title I program staff to identify areas of risk. The monitoring will be performed to ensure compliance with WIOA and Uniform Guidance, Part 200.332. Conclusion – Response accepted.
Awards to Subrecipients Criteria – During fiscal year 2022, the Governor allocated Coronavirus State and Local Recovery Funds to the Department for Summer Youth Internship Projects to provide internship opportunities in high-demand fields for youth with barriers and/or at risk of not graduating. All projects include recruitment of youth at risk of not graduating and youth from underrepresented communities and/or from low-income households. The primary supported occupations include healthcare, construction-related trades, information technology, advanced manufacturing, and energy. The Healthy Childhood Environments: Child Care Challenge project was to create new childcare slots across the State and help communities improve their childcare options and bolster opportunities for Iowans to reenter the workforce. All the projects are designed to address childcare shortages and alleviate local childcare need. The Uniform Guidance, Part 200.332 states, “All pass-through entities must: ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward.” Required information includes, in part, subrecipient's unique entity identifier, federal award identification number (FAIN), subaward budget period start and end date, identification of whether the award is research and development (R&D), and the indirect cost rate for the federal award (including if the de minimis rate is charged) per Part 200.414. Condition – For the subawards provided, the Department did not include the subrecipient's unique entity identifier, FAIN, subaward budget period start and end date, identification of whether the award is R&D, and the indirect cost rate for the federal award (including if the de minimis rate is charged) per Part 200.414. Cause – The Department has not established policies and procedures to ensure all required information is included in the subaward to the subrecipients. Effect – The information required in the subaward to subrecipients was not included due to the lack of policies and procedures. Recommendation – The Department should establish policies and procedures to ensure all required information is included in the subaward to subrecipients as required by Uniform Guidance, Part 200.332. Response and Corrective Action Planned – Effective August 2023, new sub-awards and pass thru grant agreements have elements specified in the respective agreement as required by Uniform Guidance, Part 200.332. Conclusion – Response accepted.
Subrecipient Monitoring Criteria – The Uniform Guidance, Part 200.332 states in part, “All pass-through entities must: evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring.” The Uniform Guidance, Part 200.332 also states, “All pass-through entities must: monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Pass-through entity monitoring of the subrecipient must include reviewing financial and performance reports required by the pass-through entity, following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the Federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and written confirmation from the subrecipient, highlighting the status of actions planned or taken to address Single Audit findings related to the particular subaward and issuing a management decision for applicable audit findings pertaining only to the Federal award provided to the subrecipient from the pass-through entity as required by Part 200.521.” The Uniform Guidance further states, “Depending upon the pass-through entity’s assessment of risk posed by the subrecipient, the following monitoring tools may be useful for the pass-through entity to ensure proper accountability and compliance with program requirements and achievement of performance goals: providing subrecipients with training and technical assistance on program-related matters, performing on-site reviews of the subrecipient's program operations and arranging for agreed-upon-procedures engagements as described in Part 200.425.” The Uniform Guidance, Part 200.332 also states, “All pass-through entities must: Verify that every subrecipient is audited as required by Subpart F when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in Part 200.501.” and that “All pass-through entities must: consider whether the results of the subrecipient's audits, on-site reviews, or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records.” In addition, Uniform Guidance, Part 200.501(h) states in part, “The pass-through entity is responsible for establishing requirements, as necessary, to ensure compliance by for-profit subrecipients.” and “Methods to ensure compliance for Federal awards made to for-profit subrecipients may include pre-award audits, monitoring during the agreement, and post-award audits.” Condition – The Department did not evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. The Department did not monitor the activities of subrecipients as necessary to ensure the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved, including the monitoring of Part 200.332(d)(1) to Part 200.332(d)(4). In addition, the Department did not utilize any of the monitoring tools identified in Part 200.332(e) to ensure proper accountability and compliance with program requirements and achievement of performance goals. The Department did not verify every subrecipient is audited as required by Subpart F when it is expected the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in Part 200.501. The Department did not consider whether the results of the subrecipient's audits, on-site reviews or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records. The Department did not establish policies and procedures to ensure compliance for Federal awards made to for-profit subrecipients as required in Part 200.501(h). Cause – The Department has not established policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332 and Part 200.501. The Department was also facing significant time and resource constraints, including the initial requirement of the Coronavirus State and Local Fiscal Recovery Funds (CSLFRF). Effect – The Department is not in compliance with subrecipient monitoring as required by the Uniform Guidance, Part 200.332 and Part 200.501. Recommendation – The Department should establish policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332 and Part 200.501. Response and Corrective Action Planned – The Department is in the process of developing policies and procedures to ensure compliance with the Uniform Guidance, Part 200.332 and Part 200.501 for federal awards granted with CSLFRF. The Department intends to conduct monitoring and compliance with applicable Uniform Guidance in fiscal year 2023. Specific areas to address are: Review of the subrecipient and subrecipient grant application to assess risk and to ensure approved programs are in compliance with CSLFRF. Review of documentation provided by subrecipients to ensure expenditures align with the grant application, are supported and are allowable under CSLFRF. Validate that program expenditures benefit individuals that were negatively impacted by the COVID-19 pandemic. Review post-award reports to determine if proposed projects and related goals were achieved. Identify entities that require an audit per Uniform Guidance, Part 200.501 and follow up on audit deficiencies related to the federal award. Conclusion – Response accepted.