--Type of Finding: Significant deficiency in internal control over compliance --Criteria: The Uniform Guidance, under 2 CFR Part 200 Subpart F, requires the auditee to prepare a schedule of expenditures of federal awards (SEFA) for the period covered by the auditee’s financial statements which must include the total federal awards expended. --Condition and Context: While performing audit procedures on the SEFA, we noted the SEFA included non-federal portion of some awards. Total federal awards reported on the SEFA prepared by management was overstated by $126,319. --Cause of Condition: The internal controls in place for the preparation of the SEFA were not properly implemented in order to prevent or detect and correct material misstatements on the SEFA. --Effect of Condition: The SEFA erroneously included non-federal awards and was materially misstated at the commencement of the audit because it improperly included non-federal expenditures totaling $126,319. --Questioned Costs: None. --Repeat Finding: No. --Recommendation: We recommend management design and implement internal controls to ensure all federal assistance is identified at the program level and in the finance department. We also recommend that the Organization develop a process for detail reviewing the information included on the SEFA, including verification of federal award and expenditure amounts with grantors as necessary. --Views of Responsible Officials: Management agrees with the finding. See Corrective Action Plan.
--Type of Finding: Significant deficiency in internal control over compliance --Compliance Requirements: Allowable Costs/Cost Principles and Period of Performance --Criteria: Pursuant to the Uniform Guidance (2 CFR §200), it is the responsibility of management to design and implement internal controls over compliance to ensure the organization materially complies with all direct and material compliance requirements applicable to its federal award programs. --Condition and Context: During our testing of internal controls over compliance with respect to the compliance requirements of allowable costs/cost principles and period of performance, we noted a change in the process to bill payroll time to the federal awards was made that resulted in the one instance wherein a 2 week payroll period was charged to the grant twice and a different 2 week payroll period was not charged to the grant as it should have been. The result was the federal award program was charged a slightly different amount for the period of performance than what was allowable; however, the resulting difference was less than $10,000; therefore, is not a reportable questioned cost. --Cause of Condition: There were changes in the accounting department personnel and the internal controls over compliance with respect to allowable costs/cost principles for the payroll costs failed to prevent or detect and correct the error in a timely manner. The error was detected as a result of audit procedures. --Effect of Condition: This condition introduces the possibility that similar errors could go undetected and increases the risk of noncompliance with respect to allowable costs/cost principles and period of performance. --Questioned Costs: None. --Repeat Finding: No. --Recommendation: We recommend management review the current the internal controls over compliance in place to ensure there are appropriate controls with respect to review of the costs charged to the federal award programs and that costs are being charged to grants for the appropriate periods. --Views of Responsible Officials: Management agrees with the finding. See Corrective Action Plan.