Audit 369262

Finding 2024-001 – Allowble Cost (Significant Deficiency in Internal Control Over Compliance) - (See chart on section III of audit findings page) Criteria – In accordance with the Uniform Guidance (2 CFR Part 200), Subpart E – Cost Principles, and the program’s grant agreement, costs charged to federal awards must be necessary, reasonable, and allocable to the federal program. Condition/Context – It was noted in the audit of payroll expenditures that the District used incorrect pay rates and duplicated certain miscellaneous pay codes. Total expenditures represented 5.5% of the expenditure population. While the payroll issues were originally identified in the sample selections, the actual impact for the entire payroll portion of the population was able to be calculated. Effect – Based on the corrected payroll calculation for the issues identified, the District’s allowable payroll expenditure population was approximately $8,400 higher than what was submitted for reimbursement on a net basis. Cause – While the methodology to calculate the payroll costs was appropriate for compliance purposes, due to the manual nature of the calculation, errors were not prevented, and the District’s compliance monitoring did not detect the issues. Repeat Finding – This is not a repeat finding. Recommendation – We recommend the District strengthen its internal controls over expenditure review to ensure all costs charged to federal programs comply with applicable cost principles. Views of Responsible Officials – The responsible officials acknowledge the finding and concur with the recommendation.