Audit 294734

Type of Finding: • Significant Deficiency in Internal Control over Compliance – Allowable Costs/Cost Principles • Other Matter – Non-Compliance with Allowable Costs/Cost Principles Compliance Requirements Federal Agency: Department of Transportation Federal Program Name: Enhanced Mobility of Seniors and Individuals with Disabilities Assistance Listing Number: 20.513 Federal Award Identification Number and Year: PTD0287-2022 Pass-Through Agency: WADOT Pass-Through Number(s): PTD0287 Award Period: July 1, 2021 through June 30, 2023 Criteria or specific requirement: 2 CFR 200.423 specifically identifies alcoholic beverages as unallowable costs. Condition: CLA noted one sample in which federal funds were expended on unallowable costs. Questioned costs: $85 known, $910 likely Context: A sample of 25 was made from a population of 942 nonpayroll-related general disbursement costs charged to the major program. Of the 25 sampled costs, one was found to be out of compliance with the requirements of Allowable Costs / Cost Principles, totaling $85. Sampled nonpayroll-related general disbursement costs totaled $24,560. General disbursements totaled $263,090 of the $1,706,762 tracked to the major program. Extrapolating the error to the actual costs reported on the SEFA results in a likely questioned cost amount of $910. Cause: The individual in charge of entering the purchase into Microix did not code the alcoholic beverages to a separate general ledger account that was established to track unallowable costs so that they are not charged to the federal programs. Effect: Without adequate controls in place to ensure costs are allowable, Sound Generations runs the risk of being out of compliance with not only the major program but all federal programs. Repeat Finding: No. Recommendation: CLA recommends that emphasis be placed (via an employee training or organization-wide email) on specifically disallowed costs and the importance of tracking these costs separately so that they are not charged to federal programs. Views of responsible officials: Please see the attached Management’s Corrective Action Plan.

Type of Finding: • Significant Deficiency in Internal Control over Compliance – Allowable Costs/Cost Principles • Other Matter – Non-Compliance with Allowable Costs/Cost Principles Compliance Requirements Federal Agency: Department of Transportation Federal Program Name: Enhanced Mobility of Seniors and Individuals with Disabilities Assistance Listing Number: 20.513 Federal Award Identification Number and Year: PTD0287-2022 Pass-Through Agency: WADOT Pass-Through Number(s): PTD0287 Award Period: July 1, 2021 through June 30, 2023 Criteria or specific requirement: 2 CFR 200.423 specifically identifies alcoholic beverages as unallowable costs. Condition: CLA noted one sample in which federal funds were expended on unallowable costs. Questioned costs: $85 known, $910 likely Context: A sample of 25 was made from a population of 942 nonpayroll-related general disbursement costs charged to the major program. Of the 25 sampled costs, one was found to be out of compliance with the requirements of Allowable Costs / Cost Principles, totaling $85. Sampled nonpayroll-related general disbursement costs totaled $24,560. General disbursements totaled $263,090 of the $1,706,762 tracked to the major program. Extrapolating the error to the actual costs reported on the SEFA results in a likely questioned cost amount of $910. Cause: The individual in charge of entering the purchase into Microix did not code the alcoholic beverages to a separate general ledger account that was established to track unallowable costs so that they are not charged to the federal programs. Effect: Without adequate controls in place to ensure costs are allowable, Sound Generations runs the risk of being out of compliance with not only the major program but all federal programs. Repeat Finding: No. Recommendation: CLA recommends that emphasis be placed (via an employee training or organization-wide email) on specifically disallowed costs and the importance of tracking these costs separately so that they are not charged to federal programs. Views of responsible officials: Please see the attached Management’s Corrective Action Plan.