Audit 381850

2024-001 Coronavirus State and Local Fiscal Recovery Funds – Assistance Listing No. 21.027 Significant Deficiency in Internal Control Over Compliance and Noncompliance – Inadequate Documentation Non-payroll Transactions B. Allowable Costs/Cost Principles Criteria: Per 2 CFR § 200.403(g), charges to federal awards should be adequately documented to determine allowability of costs. Condition and Context: We haphazardly selected a sample of 25 non-payroll transactions. Our sample was not statistically valid. During our testing of non-payroll expenses charged to the federal program, we noted two instances for the 25 transactions selected for testing where the documentation retained was not adequate to support allowable cost determinations. These two transactions resulted in questioned costs that totaled $732. Cause and Effect: Control activities for retaining supporting documentation did not operate consistently as designed throughout the year. As a result, certain costs were recorded to federal awards without adequate supporting documentation, resulting in questioned costs and increasing the risk of unauthorized or otherwise unallowable expenditures. Recommendation: We recommend that management train staff on documentation retention policies. Management should also implement preventative or detective controls to ensure adequate documentation is retained for federal awards. Views of Responsible Officials and Planned Corrective Action: Management agrees with the recommendation and it was implemented effective July 1, 2025.