Audit 413410

Finding 2025-001 Program Affected Under the U.S. Department of Treasury - Award Year July 1, 2024 – June 30, 2026: Assistance Listing 21.027 Coronavirus State and Local Fiscal Recovery Funds Criteria 2 CFR §200.430(i) specifies that "Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated..." Condition and Context During our program audit procedures related to the payroll cycle, we noted an internal control deficiency related to allocation of payroll costs among federally funded programs. Management did not perform sufficient review and retention of payroll allocations to identify that payroll expenses allocated to the program were being recorded in accordance with readily available wage and time and effort data. Cause and Effect The condition identified was caused by infrequent and periodic review of program-related payroll costs which were reconciled on a biannual basis. This process did not occur on a pay period basis. This resulted in an overstatement of program-related payroll expenses of $6,348. Questioned Costs $498,189.43 Identification as a Repeat Finding, if Applicable Not applicable. Recommendation We recommend the Organization strengthen controls surrounding program-related record keeping, including increasing the frequency of reconciliations and program wage allocation procedures to match the payroll cycle. Views of Responsible Officials and Corrective Action Plan Management agrees with the finding. See attached Corrective Action Plan.