Criteria - 2 CFR part 200, subpart E, Appendix IV, states that indirect costs are those costs that have been incurred for common or joint objective and cannot be readily identified with a particular final cost objective. These costs are allocated to Federal awards by use of an Indirect Cost Rate negotiated with the Organization's cognizant agency. A provisional rate is a temporary indirect cost rate applicable to a specified period which is used for funding, interim reimbursement, and to report indirect costs on Federal awards pending the establishment of a final rate for the period. A final rate is an indirect cost rate applicable to a specified past period which is based on the actual costs of the period. Once the final rate is established, upward or downward adjustments should be made to the contracts. Condition - During our compliance testing procedures, we reviewed the final Indirect Cost Rate agreement with DHHS, reviewed several months of indirect cost rate journal entries posted to contracts, and reviewed the Federal Financial Reports (SF-425) filed for various awards included in the Head Start cluster. In August 2024, COI received the agreement from DHHS. The provisional rate of 11% was reduced to a final rate of 9.5% for the period November 1, 2022 - October 31, 2023. In addition, a provisional rate of 9.5% was established to be effective for the period November 1, 2023 - October 31, 2026. As of January 2025, no billing adjustments for the final rate had been made to the contracts for the effective periods. In addition, the worksheets used to calculate the monthly indirect cost allocations had not been updated to reflect the newly established provisional rate for the current period. Furthermore, for the two SF-425 Federal Financial Reports filed after the agreement was received, no adjustment appeared to have been made to reflect the lower provisional rate. Cause - Due to the date the IDC rate agreement letter was received and that date's proximity to the end of the Organization's fiscal year end, the appropriate adjustments were not made by the end of the fiscal year. Effect - The use of the incorrect provisional rate results in overstated contract revenues and expenditures, in addition to incorrect draw down amounts being submitted to DHHS. Questioned Costs - Questioned costs are indirect costs charged to the Head Start Cluster contracts at the former provisional indirect cost rate without any billing adjustments once the final rate was established. These costs span two fiscal years and multiple contract periods. All amounts have been adjusted in these financial statements and a liability for the payback amounts has been recorded. Head Start/Early Head Start $135,557; Early Head Start Child Care Partnerships $41,611; COVID and American Rescue Plan $4,897; COVID - HS/EHS Carryover Funds $2,788; Total Questioned Costs $184,853. Recommendation - The Organization should make billing adjustments for all cost reimbursement contracts which charge funders for indirect costs using the negotiated rate. In addition, the indirect cost allocation worksheet should be updated with the effective provisional rate, so that contracts will be reporting the correct amount of costs.
Criteria - 2 CFR part 200, subpart E, Appendix IV, states that indirect costs are those costs that have been incurred for common or joint objective and cannot be readily identified with a particular final cost objective. These costs are allocated to Federal awards by use of an Indirect Cost Rate negotiated with the Organization's cognizant agency. A provisional rate is a temporary indirect cost rate applicable to a specified period which is used for funding, interim reimbursement, and to report indirect costs on Federal awards pending the establishment of a final rate for the period. A final rate is an indirect cost rate applicable to a specified past period which is based on the actual costs of the period. Once the final rate is established, upward or downward adjustments should be made to the contracts. Condition - During our compliance testing procedures, we reviewed the final Indirect Cost Rate agreement with DHHS, reviewed several months of indirect cost rate journal entries posted to contracts, and reviewed the Federal Financial Reports (SF-425) filed for various awards included in the Head Start cluster. In August 2024, COI received the agreement from DHHS. The provisional rate of 11% was reduced to a final rate of 9.5% for the period November 1, 2022 - October 31, 2023. In addition, a provisional rate of 9.5% was established to be effective for the period November 1, 2023 - October 31, 2026. As of January 2025, no billing adjustments for the final rate had been made to the contracts for the effective periods. In addition, the worksheets used to calculate the monthly indirect cost allocations had not been updated to reflect the newly established provisional rate for the current period. Furthermore, for the two SF-425 Federal Financial Reports filed after the agreement was received, no adjustment appeared to have been made to reflect the lower provisional rate. Cause - Due to the date the IDC rate agreement letter was received and that date's proximity to the end of the Organization's fiscal year end, the appropriate adjustments were not made by the end of the fiscal year. Effect - The use of the incorrect provisional rate results in overstated contract revenues and expenditures, in addition to incorrect draw down amounts being submitted to DHHS. Questioned Costs - Questioned costs are indirect costs charged to the Head Start Cluster contracts at the former provisional indirect cost rate without any billing adjustments once the final rate was established. These costs span two fiscal years and multiple contract periods. All amounts have been adjusted in these financial statements and a liability for the payback amounts has been recorded. Head Start/Early Head Start $135,557; Early Head Start Child Care Partnerships $41,611; COVID and American Rescue Plan $4,897; COVID - HS/EHS Carryover Funds $2,788; Total Questioned Costs $184,853. Recommendation - The Organization should make billing adjustments for all cost reimbursement contracts which charge funders for indirect costs using the negotiated rate. In addition, the indirect cost allocation worksheet should be updated with the effective provisional rate, so that contracts will be reporting the correct amount of costs.
Criteria - 2 CFR part 200, subpart E, Appendix IV, states that indirect costs are those costs that have been incurred for common or joint objective and cannot be readily identified with a particular final cost objective. These costs are allocated to Federal awards by use of an Indirect Cost Rate negotiated with the Organization's cognizant agency. A provisional rate is a temporary indirect cost rate applicable to a specified period which is used for funding, interim reimbursement, and to report indirect costs on Federal awards pending the establishment of a final rate for the period. A final rate is an indirect cost rate applicable to a specified past period which is based on the actual costs of the period. Once the final rate is established, upward or downward adjustments should be made to the contracts. Condition - During our compliance testing procedures, we reviewed the final Indirect Cost Rate agreement with DHHS, reviewed several months of indirect cost rate journal entries posted to contracts, and reviewed the Federal Financial Reports (SF-425) filed for various awards included in the Head Start cluster. In August 2024, COI received the agreement from DHHS. The provisional rate of 11% was reduced to a final rate of 9.5% for the period November 1, 2022 - October 31, 2023. In addition, a provisional rate of 9.5% was established to be effective for the period November 1, 2023 - October 31, 2026. As of January 2025, no billing adjustments for the final rate had been made to the contracts for the effective periods. In addition, the worksheets used to calculate the monthly indirect cost allocations had not been updated to reflect the newly established provisional rate for the current period. Furthermore, for the two SF-425 Federal Financial Reports filed after the agreement was received, no adjustment appeared to have been made to reflect the lower provisional rate. Cause - Due to the date the IDC rate agreement letter was received and that date's proximity to the end of the Organization's fiscal year end, the appropriate adjustments were not made by the end of the fiscal year. Effect - The use of the incorrect provisional rate results in overstated contract revenues and expenditures, in addition to incorrect draw down amounts being submitted to DHHS. Questioned Costs - Questioned costs are indirect costs charged to the Head Start Cluster contracts at the former provisional indirect cost rate without any billing adjustments once the final rate was established. These costs span two fiscal years and multiple contract periods. All amounts have been adjusted in these financial statements and a liability for the payback amounts has been recorded. Head Start/Early Head Start $135,557; Early Head Start Child Care Partnerships $41,611; COVID and American Rescue Plan $4,897; COVID - HS/EHS Carryover Funds $2,788; Total Questioned Costs $184,853. Recommendation - The Organization should make billing adjustments for all cost reimbursement contracts which charge funders for indirect costs using the negotiated rate. In addition, the indirect cost allocation worksheet should be updated with the effective provisional rate, so that contracts will be reporting the correct amount of costs.
Criteria - 2 CFR part 200, subpart E, Appendix IV, states that indirect costs are those costs that have been incurred for common or joint objective and cannot be readily identified with a particular final cost objective. These costs are allocated to Federal awards by use of an Indirect Cost Rate negotiated with the Organization's cognizant agency. A provisional rate is a temporary indirect cost rate applicable to a specified period which is used for funding, interim reimbursement, and to report indirect costs on Federal awards pending the establishment of a final rate for the period. A final rate is an indirect cost rate applicable to a specified past period which is based on the actual costs of the period. Once the final rate is established, upward or downward adjustments should be made to the contracts. Condition - During our compliance testing procedures, we reviewed the final Indirect Cost Rate agreement with DHHS, reviewed several months of indirect cost rate journal entries posted to contracts, and reviewed the Federal Financial Reports (SF-425) filed for various awards included in the Head Start cluster. In August 2024, COI received the agreement from DHHS. The provisional rate of 11% was reduced to a final rate of 9.5% for the period November 1, 2022 - October 31, 2023. In addition, a provisional rate of 9.5% was established to be effective for the period November 1, 2023 - October 31, 2026. As of January 2025, no billing adjustments for the final rate had been made to the contracts for the effective periods. In addition, the worksheets used to calculate the monthly indirect cost allocations had not been updated to reflect the newly established provisional rate for the current period. Furthermore, for the two SF-425 Federal Financial Reports filed after the agreement was received, no adjustment appeared to have been made to reflect the lower provisional rate. Cause - Due to the date the IDC rate agreement letter was received and that date's proximity to the end of the Organization's fiscal year end, the appropriate adjustments were not made by the end of the fiscal year. Effect - The use of the incorrect provisional rate results in overstated contract revenues and expenditures, in addition to incorrect draw down amounts being submitted to DHHS. Questioned Costs - Questioned costs are indirect costs charged to the Head Start Cluster contracts at the former provisional indirect cost rate without any billing adjustments once the final rate was established. These costs span two fiscal years and multiple contract periods. All amounts have been adjusted in these financial statements and a liability for the payback amounts has been recorded. Head Start/Early Head Start $135,557; Early Head Start Child Care Partnerships $41,611; COVID and American Rescue Plan $4,897; COVID - HS/EHS Carryover Funds $2,788; Total Questioned Costs $184,853. Recommendation - The Organization should make billing adjustments for all cost reimbursement contracts which charge funders for indirect costs using the negotiated rate. In addition, the indirect cost allocation worksheet should be updated with the effective provisional rate, so that contracts will be reporting the correct amount of costs.
Criteria - 2 CFR part 200, subpart E, Appendix IV, states that indirect costs are those costs that have been incurred for common or joint objective and cannot be readily identified with a particular final cost objective. These costs are allocated to Federal awards by use of an Indirect Cost Rate negotiated with the Organization's cognizant agency. A provisional rate is a temporary indirect cost rate applicable to a specified period which is used for funding, interim reimbursement, and to report indirect costs on Federal awards pending the establishment of a final rate for the period. A final rate is an indirect cost rate applicable to a specified past period which is based on the actual costs of the period. Once the final rate is established, upward or downward adjustments should be made to the contracts. Condition - During our compliance testing procedures, we reviewed the final Indirect Cost Rate agreement with DHHS, reviewed several months of indirect cost rate journal entries posted to contracts, and reviewed the Federal Financial Reports (SF-425) filed for various awards included in the Head Start cluster. In August 2024, COI received the agreement from DHHS. The provisional rate of 11% was reduced to a final rate of 9.5% for the period November 1, 2022 - October 31, 2023. In addition, a provisional rate of 9.5% was established to be effective for the period November 1, 2023 - October 31, 2026. As of January 2025, no billing adjustments for the final rate had been made to the contracts for the effective periods. In addition, the worksheets used to calculate the monthly indirect cost allocations had not been updated to reflect the newly established provisional rate for the current period. Furthermore, for the two SF-425 Federal Financial Reports filed after the agreement was received, no adjustment appeared to have been made to reflect the lower provisional rate. Cause - Due to the date the IDC rate agreement letter was received and that date's proximity to the end of the Organization's fiscal year end, the appropriate adjustments were not made by the end of the fiscal year. Effect - The use of the incorrect provisional rate results in overstated contract revenues and expenditures, in addition to incorrect draw down amounts being submitted to DHHS. Questioned Costs - Questioned costs are indirect costs charged to the Head Start Cluster contracts at the former provisional indirect cost rate without any billing adjustments once the final rate was established. These costs span two fiscal years and multiple contract periods. All amounts have been adjusted in these financial statements and a liability for the payback amounts has been recorded. Head Start/Early Head Start $135,557; Early Head Start Child Care Partnerships $41,611; COVID and American Rescue Plan $4,897; COVID - HS/EHS Carryover Funds $2,788; Total Questioned Costs $184,853. Recommendation - The Organization should make billing adjustments for all cost reimbursement contracts which charge funders for indirect costs using the negotiated rate. In addition, the indirect cost allocation worksheet should be updated with the effective provisional rate, so that contracts will be reporting the correct amount of costs.
Criteria - 2 CFR part 200, subpart E, Appendix IV, states that indirect costs are those costs that have been incurred for common or joint objective and cannot be readily identified with a particular final cost objective. These costs are allocated to Federal awards by use of an Indirect Cost Rate negotiated with the Organization's cognizant agency. A provisional rate is a temporary indirect cost rate applicable to a specified period which is used for funding, interim reimbursement, and to report indirect costs on Federal awards pending the establishment of a final rate for the period. A final rate is an indirect cost rate applicable to a specified past period which is based on the actual costs of the period. Once the final rate is established, upward or downward adjustments should be made to the contracts. Condition - During our compliance testing procedures, we reviewed the final Indirect Cost Rate agreement with DHHS, reviewed several months of indirect cost rate journal entries posted to contracts, and reviewed the Federal Financial Reports (SF-425) filed for various awards included in the Head Start cluster. In August 2024, COI received the agreement from DHHS. The provisional rate of 11% was reduced to a final rate of 9.5% for the period November 1, 2022 - October 31, 2023. In addition, a provisional rate of 9.5% was established to be effective for the period November 1, 2023 - October 31, 2026. As of January 2025, no billing adjustments for the final rate had been made to the contracts for the effective periods. In addition, the worksheets used to calculate the monthly indirect cost allocations had not been updated to reflect the newly established provisional rate for the current period. Furthermore, for the two SF-425 Federal Financial Reports filed after the agreement was received, no adjustment appeared to have been made to reflect the lower provisional rate. Cause - Due to the date the IDC rate agreement letter was received and that date's proximity to the end of the Organization's fiscal year end, the appropriate adjustments were not made by the end of the fiscal year. Effect - The use of the incorrect provisional rate results in overstated contract revenues and expenditures, in addition to incorrect draw down amounts being submitted to DHHS. Questioned Costs - Questioned costs are indirect costs charged to the Head Start Cluster contracts at the former provisional indirect cost rate without any billing adjustments once the final rate was established. These costs span two fiscal years and multiple contract periods. All amounts have been adjusted in these financial statements and a liability for the payback amounts has been recorded. Head Start/Early Head Start $135,557; Early Head Start Child Care Partnerships $41,611; COVID and American Rescue Plan $4,897; COVID - HS/EHS Carryover Funds $2,788; Total Questioned Costs $184,853. Recommendation - The Organization should make billing adjustments for all cost reimbursement contracts which charge funders for indirect costs using the negotiated rate. In addition, the indirect cost allocation worksheet should be updated with the effective provisional rate, so that contracts will be reporting the correct amount of costs.
Criteria - 2 CFR part 200, subpart E, Appendix IV, states that indirect costs are those costs that have been incurred for common or joint objective and cannot be readily identified with a particular final cost objective. These costs are allocated to Federal awards by use of an Indirect Cost Rate negotiated with the Organization's cognizant agency. A provisional rate is a temporary indirect cost rate applicable to a specified period which is used for funding, interim reimbursement, and to report indirect costs on Federal awards pending the establishment of a final rate for the period. A final rate is an indirect cost rate applicable to a specified past period which is based on the actual costs of the period. Once the final rate is established, upward or downward adjustments should be made to the contracts. Condition - During our compliance testing procedures, we reviewed the final Indirect Cost Rate agreement with DHHS, reviewed several months of indirect cost rate journal entries posted to contracts, and reviewed the Federal Financial Reports (SF-425) filed for various awards included in the Head Start cluster. In August 2024, COI received the agreement from DHHS. The provisional rate of 11% was reduced to a final rate of 9.5% for the period November 1, 2022 - October 31, 2023. In addition, a provisional rate of 9.5% was established to be effective for the period November 1, 2023 - October 31, 2026. As of January 2025, no billing adjustments for the final rate had been made to the contracts for the effective periods. In addition, the worksheets used to calculate the monthly indirect cost allocations had not been updated to reflect the newly established provisional rate for the current period. Furthermore, for the two SF-425 Federal Financial Reports filed after the agreement was received, no adjustment appeared to have been made to reflect the lower provisional rate. Cause - Due to the date the IDC rate agreement letter was received and that date's proximity to the end of the Organization's fiscal year end, the appropriate adjustments were not made by the end of the fiscal year. Effect - The use of the incorrect provisional rate results in overstated contract revenues and expenditures, in addition to incorrect draw down amounts being submitted to DHHS. Questioned Costs - Questioned costs are indirect costs charged to the Head Start Cluster contracts at the former provisional indirect cost rate without any billing adjustments once the final rate was established. These costs span two fiscal years and multiple contract periods. All amounts have been adjusted in these financial statements and a liability for the payback amounts has been recorded. Head Start/Early Head Start $135,557; Early Head Start Child Care Partnerships $41,611; COVID and American Rescue Plan $4,897; COVID - HS/EHS Carryover Funds $2,788; Total Questioned Costs $184,853. Recommendation - The Organization should make billing adjustments for all cost reimbursement contracts which charge funders for indirect costs using the negotiated rate. In addition, the indirect cost allocation worksheet should be updated with the effective provisional rate, so that contracts will be reporting the correct amount of costs.
Criteria - 2 CFR part 200, subpart E, Appendix IV, states that indirect costs are those costs that have been incurred for common or joint objective and cannot be readily identified with a particular final cost objective. These costs are allocated to Federal awards by use of an Indirect Cost Rate negotiated with the Organization's cognizant agency. A provisional rate is a temporary indirect cost rate applicable to a specified period which is used for funding, interim reimbursement, and to report indirect costs on Federal awards pending the establishment of a final rate for the period. A final rate is an indirect cost rate applicable to a specified past period which is based on the actual costs of the period. Once the final rate is established, upward or downward adjustments should be made to the contracts. Condition - During our compliance testing procedures, we reviewed the final Indirect Cost Rate agreement with DHHS, reviewed several months of indirect cost rate journal entries posted to contracts, and reviewed the Federal Financial Reports (SF-425) filed for various awards included in the Head Start cluster. In August 2024, COI received the agreement from DHHS. The provisional rate of 11% was reduced to a final rate of 9.5% for the period November 1, 2022 - October 31, 2023. In addition, a provisional rate of 9.5% was established to be effective for the period November 1, 2023 - October 31, 2026. As of January 2025, no billing adjustments for the final rate had been made to the contracts for the effective periods. In addition, the worksheets used to calculate the monthly indirect cost allocations had not been updated to reflect the newly established provisional rate for the current period. Furthermore, for the two SF-425 Federal Financial Reports filed after the agreement was received, no adjustment appeared to have been made to reflect the lower provisional rate. Cause - Due to the date the IDC rate agreement letter was received and that date's proximity to the end of the Organization's fiscal year end, the appropriate adjustments were not made by the end of the fiscal year. Effect - The use of the incorrect provisional rate results in overstated contract revenues and expenditures, in addition to incorrect draw down amounts being submitted to DHHS. Questioned Costs - Questioned costs are indirect costs charged to the Head Start Cluster contracts at the former provisional indirect cost rate without any billing adjustments once the final rate was established. These costs span two fiscal years and multiple contract periods. All amounts have been adjusted in these financial statements and a liability for the payback amounts has been recorded. Head Start/Early Head Start $135,557; Early Head Start Child Care Partnerships $41,611; COVID and American Rescue Plan $4,897; COVID - HS/EHS Carryover Funds $2,788; Total Questioned Costs $184,853. Recommendation - The Organization should make billing adjustments for all cost reimbursement contracts which charge funders for indirect costs using the negotiated rate. In addition, the indirect cost allocation worksheet should be updated with the effective provisional rate, so that contracts will be reporting the correct amount of costs.