Audit 370314

Program: ALN 84.425V, Department of Education, Education Stabilization Fund, Emergency Assistance to Non-Public Schools, passed through the State of Alaska, grant number CO23.244.01/1004 052132102 2211Criteria: 2 CFR section 200.303(d)(2), states that a non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statues, regulations, and the terms and conditions of the federal award. 2 CFR section 200.430(g)(1), states that charges to Federal awards for salaries and wages must be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Condition: SAAMS’ policies require a payroll batch report be reviewed prior to issuing payroll. This payroll batch report specifies employee name, program charged, amount charged to each program, hours, and pay rate. During our testing, we identified that the payroll batch report did not always contain amounts charged to each program or pay rates, making the review ineffective. Cause: Turnover in personnel during the fiscal year led to inadequate training and inconsistent performance of the payroll batch report review. Effect: Unallowable payroll costs may be charged to a federal program. Questioned costs: None Context: During our testing of 11 payroll batch reports, 5 did not contain pay rates or amounts charged to each program. Statistical sampling: No Repeat finding: No Recommendation: We recommend the entity develop policies that incorporate standardized reporting and description of the review objective, along with training to staff.