Audit 309064

U. S. Department of Health and Human Services 2022-002 Allowable Costs Program(s) Name of Federal Program (Assistance Listing Number) Urban Indian Health Services (93.193) Special Diabetes Program for Indians - Diabetes Prevention and Treatment Projects (93.237) Criteria - Recipients of federal awards must follow the costs principles set out at 2 CFR section 200.430 to substantiate compensation and other purchases charged to a federal program. “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: …(iii) reasonable reflect the total activity for which the employee is compensated by the non-Federal entity” 2 CFR section 200.430(i). The Organization’s processes did not maintain sufficient documentation of the approval of the activity of each employee or the purchase of goods/services for the programs identified above. Context and Condition - We selected 27 paychecks from three pay periods to test for compliance with standards in these two programs. Records for six of the paychecks tested lacked documentation of approval of the employee’s supervisor. We also selected 16 transactions for purchased goods and services to test compliance with standards in these two programs. Records for two transactions tested lacked documentation of approval by the program director. Cause - The Organization replaced its payroll processing servicer subsequent to 2022. Access to certain records from the prior servicer were no longer available. Personnel turnover resulting in inconsistencies in maintaining required documentation. Effect - A federal program could be charged compensation for employees who did not provide services directly attributable to the program or charged for goods/services not related to the program. Questioned Costs - No costs were questioned. Repeat finding - No Statistically valid - Yes Recommendation - We recommend the Organization ensure it 1) maintains records of each employee’s activity and 2) monitors compliance with the job-costing system implemented. Views of responsible officials - The Organization believes the paychecks and purchases identified were approved prior to payment. We will ensure that documentation is downloaded each pay period to ensure such documentation is not lost when a change in servicer is made.

U.S. Department of Health and Human Services 2022-003 Cash Management/Reporting Program(s) Name of Federal Program (Assistance Listing Number) Urban Indian Health Services (93.193) Special Diabetes Program for Indians - Diabetes Prevention and Treatment Projects (93.237) Criteria - Recipients of federal awards must minimize the time elapsing between the receipt of funds from the U.S. Treasury and disbursement by the Organization set out at 2 CFR section 200.305(b). Context and Condition - We compared two quarterly Federal Cash Transaction Reports to total disbursements reported by these two programs in the Organization’s job-costing system. In both reports we found that the amounts requested did not match the amounts in the job-costing system. Cause - Due to increased funding the Organization received to address the impact of COVID-19, disbursements were not always correctly assigned to a program when incurred. Requests for federal funds were made based on those incomplete reports that were changed subsequently and no longer represent the amounts requested. The original reports were not maintained to support the requests made. Effect - A federal program could disburse funds prior to the disbursement by the Organization. We identified that both programs had requested funds in excess of disbursements. Questioned Costs - No costs were questioned. Repeat finding - Yes Statistically valid - Yes Recommendation - We recommend the Organization 1) maintains timely and accurate recording of disbursements in its job-costing system and 2) regularly request grant funds based on amounts expended as report in the Organization’s job-costing system. Views of responsible officials - The Organization is implementing a grant tracking system in addition to its job-costing system to better comply with these requirements. Together, these systems will be used to request only the amount attributable to the program for reimbursement.

U. S. Department of Health and Human Services 2022-002 Allowable Costs Program(s) Name of Federal Program (Assistance Listing Number) Urban Indian Health Services (93.193) Special Diabetes Program for Indians - Diabetes Prevention and Treatment Projects (93.237) Criteria - Recipients of federal awards must follow the costs principles set out at 2 CFR section 200.430 to substantiate compensation and other purchases charged to a federal program. “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: …(iii) reasonable reflect the total activity for which the employee is compensated by the non-Federal entity” 2 CFR section 200.430(i). The Organization’s processes did not maintain sufficient documentation of the approval of the activity of each employee or the purchase of goods/services for the programs identified above. Context and Condition - We selected 27 paychecks from three pay periods to test for compliance with standards in these two programs. Records for six of the paychecks tested lacked documentation of approval of the employee’s supervisor. We also selected 16 transactions for purchased goods and services to test compliance with standards in these two programs. Records for two transactions tested lacked documentation of approval by the program director. Cause - The Organization replaced its payroll processing servicer subsequent to 2022. Access to certain records from the prior servicer were no longer available. Personnel turnover resulting in inconsistencies in maintaining required documentation. Effect - A federal program could be charged compensation for employees who did not provide services directly attributable to the program or charged for goods/services not related to the program. Questioned Costs - No costs were questioned. Repeat finding - No Statistically valid - Yes Recommendation - We recommend the Organization ensure it 1) maintains records of each employee’s activity and 2) monitors compliance with the job-costing system implemented. Views of responsible officials - The Organization believes the paychecks and purchases identified were approved prior to payment. We will ensure that documentation is downloaded each pay period to ensure such documentation is not lost when a change in servicer is made.

U.S. Department of Health and Human Services 2022-003 Cash Management/Reporting Program(s) Name of Federal Program (Assistance Listing Number) Urban Indian Health Services (93.193) Special Diabetes Program for Indians - Diabetes Prevention and Treatment Projects (93.237) Criteria - Recipients of federal awards must minimize the time elapsing between the receipt of funds from the U.S. Treasury and disbursement by the Organization set out at 2 CFR section 200.305(b). Context and Condition - We compared two quarterly Federal Cash Transaction Reports to total disbursements reported by these two programs in the Organization’s job-costing system. In both reports we found that the amounts requested did not match the amounts in the job-costing system. Cause - Due to increased funding the Organization received to address the impact of COVID-19, disbursements were not always correctly assigned to a program when incurred. Requests for federal funds were made based on those incomplete reports that were changed subsequently and no longer represent the amounts requested. The original reports were not maintained to support the requests made. Effect - A federal program could disburse funds prior to the disbursement by the Organization. We identified that both programs had requested funds in excess of disbursements. Questioned Costs - No costs were questioned. Repeat finding - Yes Statistically valid - Yes Recommendation - We recommend the Organization 1) maintains timely and accurate recording of disbursements in its job-costing system and 2) regularly request grant funds based on amounts expended as report in the Organization’s job-costing system. Views of responsible officials - The Organization is implementing a grant tracking system in addition to its job-costing system to better comply with these requirements. Together, these systems will be used to request only the amount attributable to the program for reimbursement.

U. S. Department of Health and Human Services 2022-002 Allowable Costs Program(s) Name of Federal Program (Assistance Listing Number) Urban Indian Health Services (93.193) Special Diabetes Program for Indians - Diabetes Prevention and Treatment Projects (93.237) Criteria - Recipients of federal awards must follow the costs principles set out at 2 CFR section 200.430 to substantiate compensation and other purchases charged to a federal program. “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: …(iii) reasonable reflect the total activity for which the employee is compensated by the non-Federal entity” 2 CFR section 200.430(i). The Organization’s processes did not maintain sufficient documentation of the approval of the activity of each employee or the purchase of goods/services for the programs identified above. Context and Condition - We selected 27 paychecks from three pay periods to test for compliance with standards in these two programs. Records for six of the paychecks tested lacked documentation of approval of the employee’s supervisor. We also selected 16 transactions for purchased goods and services to test compliance with standards in these two programs. Records for two transactions tested lacked documentation of approval by the program director. Cause - The Organization replaced its payroll processing servicer subsequent to 2022. Access to certain records from the prior servicer were no longer available. Personnel turnover resulting in inconsistencies in maintaining required documentation. Effect - A federal program could be charged compensation for employees who did not provide services directly attributable to the program or charged for goods/services not related to the program. Questioned Costs - No costs were questioned. Repeat finding - No Statistically valid - Yes Recommendation - We recommend the Organization ensure it 1) maintains records of each employee’s activity and 2) monitors compliance with the job-costing system implemented. Views of responsible officials - The Organization believes the paychecks and purchases identified were approved prior to payment. We will ensure that documentation is downloaded each pay period to ensure such documentation is not lost when a change in servicer is made.

U.S. Department of Health and Human Services 2022-003 Cash Management/Reporting Program(s) Name of Federal Program (Assistance Listing Number) Urban Indian Health Services (93.193) Special Diabetes Program for Indians - Diabetes Prevention and Treatment Projects (93.237) Criteria - Recipients of federal awards must minimize the time elapsing between the receipt of funds from the U.S. Treasury and disbursement by the Organization set out at 2 CFR section 200.305(b). Context and Condition - We compared two quarterly Federal Cash Transaction Reports to total disbursements reported by these two programs in the Organization’s job-costing system. In both reports we found that the amounts requested did not match the amounts in the job-costing system. Cause - Due to increased funding the Organization received to address the impact of COVID-19, disbursements were not always correctly assigned to a program when incurred. Requests for federal funds were made based on those incomplete reports that were changed subsequently and no longer represent the amounts requested. The original reports were not maintained to support the requests made. Effect - A federal program could disburse funds prior to the disbursement by the Organization. We identified that both programs had requested funds in excess of disbursements. Questioned Costs - No costs were questioned. Repeat finding - Yes Statistically valid - Yes Recommendation - We recommend the Organization 1) maintains timely and accurate recording of disbursements in its job-costing system and 2) regularly request grant funds based on amounts expended as report in the Organization’s job-costing system. Views of responsible officials - The Organization is implementing a grant tracking system in addition to its job-costing system to better comply with these requirements. Together, these systems will be used to request only the amount attributable to the program for reimbursement.

U. S. Department of Health and Human Services 2022-002 Allowable Costs Program(s) Name of Federal Program (Assistance Listing Number) Urban Indian Health Services (93.193) Special Diabetes Program for Indians - Diabetes Prevention and Treatment Projects (93.237) Criteria - Recipients of federal awards must follow the costs principles set out at 2 CFR section 200.430 to substantiate compensation and other purchases charged to a federal program. “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: …(iii) reasonable reflect the total activity for which the employee is compensated by the non-Federal entity” 2 CFR section 200.430(i). The Organization’s processes did not maintain sufficient documentation of the approval of the activity of each employee or the purchase of goods/services for the programs identified above. Context and Condition - We selected 27 paychecks from three pay periods to test for compliance with standards in these two programs. Records for six of the paychecks tested lacked documentation of approval of the employee’s supervisor. We also selected 16 transactions for purchased goods and services to test compliance with standards in these two programs. Records for two transactions tested lacked documentation of approval by the program director. Cause - The Organization replaced its payroll processing servicer subsequent to 2022. Access to certain records from the prior servicer were no longer available. Personnel turnover resulting in inconsistencies in maintaining required documentation. Effect - A federal program could be charged compensation for employees who did not provide services directly attributable to the program or charged for goods/services not related to the program. Questioned Costs - No costs were questioned. Repeat finding - No Statistically valid - Yes Recommendation - We recommend the Organization ensure it 1) maintains records of each employee’s activity and 2) monitors compliance with the job-costing system implemented. Views of responsible officials - The Organization believes the paychecks and purchases identified were approved prior to payment. We will ensure that documentation is downloaded each pay period to ensure such documentation is not lost when a change in servicer is made.

U.S. Department of Health and Human Services 2022-003 Cash Management/Reporting Program(s) Name of Federal Program (Assistance Listing Number) Urban Indian Health Services (93.193) Special Diabetes Program for Indians - Diabetes Prevention and Treatment Projects (93.237) Criteria - Recipients of federal awards must minimize the time elapsing between the receipt of funds from the U.S. Treasury and disbursement by the Organization set out at 2 CFR section 200.305(b). Context and Condition - We compared two quarterly Federal Cash Transaction Reports to total disbursements reported by these two programs in the Organization’s job-costing system. In both reports we found that the amounts requested did not match the amounts in the job-costing system. Cause - Due to increased funding the Organization received to address the impact of COVID-19, disbursements were not always correctly assigned to a program when incurred. Requests for federal funds were made based on those incomplete reports that were changed subsequently and no longer represent the amounts requested. The original reports were not maintained to support the requests made. Effect - A federal program could disburse funds prior to the disbursement by the Organization. We identified that both programs had requested funds in excess of disbursements. Questioned Costs - No costs were questioned. Repeat finding - Yes Statistically valid - Yes Recommendation - We recommend the Organization 1) maintains timely and accurate recording of disbursements in its job-costing system and 2) regularly request grant funds based on amounts expended as report in the Organization’s job-costing system. Views of responsible officials - The Organization is implementing a grant tracking system in addition to its job-costing system to better comply with these requirements. Together, these systems will be used to request only the amount attributable to the program for reimbursement.