Audit 389897

Significant deficiency in internal controls over compliance and noncompliance with period of performance compliance requirements. Federal Agency: Department of Labor Program Title: WIOA Cluster Assistance Listing Number: 17.259 Award Number: 24-124-OSY; 24-108-ISY Award Period: July 1, 2024 through June 30, 2025 Criteria 2 U.S. Code of Federal Regulations (CFR) 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards requires that a nonfederal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity. Condition/Context for Evaluation In a sample of 25 selections, we noted two charges made to federal awards that did not occur during the approved budget period. Cause The Clubs’ internal controls over period of performance failed to identify transactions that were expensed in the incorrect period and thereby charged to the federal award in the incorrect budget period. Effect or Potential Effect The Clubs made charges to federal awards for expenses that were not incurred during the budget period of the awards. Questioned Costs $336.15 for the two charges noted above. Known questioned costs were computed based on the accumulation of the portion of transactions tested that were incurred outside of the period of performance. Repeat Finding Not applicable. Recommendation We recommend that the Clubs enhance its review of expenditures to ensure they are recorded in the correct period thereby ensuring that costs charged to federal awards were incurred during the period of performance of the awards. Views of Responsible Officials of Auditee Management agrees with the finding and has provided the accompanying corrective action plan.

Significant deficiency in internal controls over compliance with allowable costs/cost principles compliance requirements. Federal Agency: Department of Labor Program Title: WIOA Cluster Assistance Listing Number: 17.259 Award Number: 24-124-OSY; 24-108-ISY Award Period: July 1, 2024 through June 30, 2025 Criteria 2 U.S. Code of Federal Regulations (CFR) 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart E requires that costs charged to federal awards be supported by adequate documentation and represent charges for allowable costs. Condition/Context for Evaluation In a sample of 25 payroll selections, we noted three charges made to federal awards for which there were errors in intervening calculations that resulted in incorrect amounts being charged to Federal awards. Cause The Clubs’ internal controls did not include sufficient review of intervening calculations in accumulating costs to be invoiced. Effect or Potential Effect The Clubs did not fully comply with the allowable costs principles as specified in 2 CFR 200, Subpart E. As a result, there may be charges to awards that do not have adequate support. Questioned Costs No known questioned costs. Known errors resulted in amounts undercharged to federal awards. Repeat Finding Not applicable. Recommendation We recommend that the Clubs implement the necessary internal controls to ensure sufficient review of intervening calculations are performed and costs charged to federal awards are based on actual expenses incurred and paid and are supported by adequate documentation. Views of Responsible Officials of Auditee Management agrees with the finding and has provided the accompanying corrective action plan.