Audit 414228

Finding number: 2025-001 AL number and title: WIOA Cluster - 17.258, 17.259 and 17.278; VA Supportive Services for Veteran Families Program - 64.033 Name of federal agency: U.S. Department of Labor, U.S. Department of Veterans Affairs Name of pass-through entity: State of California Employment Development Department; County of Los Angeles Workforce Development, Aging, and Community Services Department; City of Los Angeles Economic and Workforce Development Department; Repeat finding: Yes - 2023-005 Criteria: Under the Uniform Guidance, specifically 2 CFR 200.430, organizations are permitted to use budgeted amounts to allocate time to Federal programs, as long as there is a process in place to true-up the costs on a regular basis. Condition: In general, JVS personnel prepare manual timesheets to record the actual time worked on the organization's various programs. No process is currently in place to compare or revise the time if the budgeted time differs from the actual time. Cause: The organization lacked sufficient accounting resources to prepare these updates. During the year, management did implement the review,. Effect or potential effect: Hours charged to certain programs did not agree to the timesheets completed by employees and reviewed by their supervisors. Context We tested a total of 40 timesheets over the two major programs and noted 10 instances in which time allocated was not properly supported by a timecard and/or time-and-effort supporting documentation. Nine of these instances were employees within the WIOA program, and eight of the occurences were in the first half of the year, before implementation of additional procedures. One of the instances related to the VA program. Recommendation: Management should establish procedures to ensure payroll costs charged to federal awards are supported by records that accurately reflect the work performed. This should include reviewing available project-level labor data, reconciling payroll allocations to supporting time and effort records, and updating allocations as necessary each pay period to ensure costs are charged to the appropriate programs and funding sources based on actual activity. SECTION III - SUMMARY OF FEDERAL AWARD FINDINGS AND QUESTIONED COSTS (continued) Views of Responsible Official: We agree with the finding. During 2025, JVS implemented enhancements within Paylocity that allow employees to electronically review and update their labor allocations, strengthening internal controls over payroll cost allocation. Management has also enhanced its review and monitoring procedures surrounding labor allocation changes. While these improvements have significantly reduced the risk of misallocations, remediation efforts remain ongoing. JVS continues to refine its processes to ensure labor costs are accurately recorded and that any necessary allocation corrections are

2025-002 CFDA number: 64.033 CFDA title: VA Supportive Services for Veteran Families Program Federal award identification number and year: 23-CA-458 Name of federal agency: U.S. Department of Veterans Affairs Name of pass-through entity: N/A Repeat finding: No Criteria: The program requires that quarterly reports be filed within 30 days of the end of each quarter and that the annual report be filed within 90 days of September 30. Condition: Certain of the required reports were not filed timely.