Audit 46504

Shuttered Venue Operators Grant Program ? Assistance Listing No. 59.075 Criteria: 2 CFR ?200.430 (1)(i) requires that charges to federal awards for salaries and wages be based on records that accurately reflect the work performed. The records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Condition: Tacoma Arts Live has a system of internal controls over payroll costs but the controls in place were not operating effectively. Controls over payroll costs failed to detect unallowable payroll costs as well as discrepancies between hours worked and hours charged to the program. Context: Controls failed to detect errors on two out of forty payroll selections. The first selection revealed that tips earned by staff were charged to the federal award, which are unallowable costs. The second selection revealed a discrepancy between hours worked and hours paid and charged to the program. These errors were identified using a statistically valid sample. Cause: Payroll costs were reviewed before being charged to federal awards, but this control failed to prevent or detect noncompliance. Effect: The allowable cost population supporting the Shuttered Venue Operators Grant Program contained unallowable tips as well as a payroll disbursement that was not supported by the underlying records of work performed. Questioned Costs: below the $25,000 reporting threshold. Recommendation: We recommend that Tacoma Arts Live implement more controls to ensure that payroll costs are sufficiently reviewed for accuracy and allowability. Views of Responsible Officials: Management agrees with the finding and recommendations set forth within and has developed a corrective action plan to address the instances of noncompliance identified and lapses in prescribed internal controls.

Shuttered Venue Operators Grant Program ? Assistance Listing No. 59.075 Criteria: 2 CFR ?200.430 (1)(i) requires that charges to federal awards for salaries and wages be based on records that accurately reflect the work performed. The records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Condition: Tacoma Arts Live has a system of internal controls over payroll costs but the controls in place were not operating effectively. Controls over payroll costs failed to detect unallowable payroll costs as well as discrepancies between hours worked and hours charged to the program. Context: Controls failed to detect errors on two out of forty payroll selections. The first selection revealed that tips earned by staff were charged to the federal award, which are unallowable costs. The second selection revealed a discrepancy between hours worked and hours paid and charged to the program. These errors were identified using a statistically valid sample. Cause: Payroll costs were reviewed before being charged to federal awards, but this control failed to prevent or detect noncompliance. Effect: The allowable cost population supporting the Shuttered Venue Operators Grant Program contained unallowable tips as well as a payroll disbursement that was not supported by the underlying records of work performed. Questioned Costs: below the $25,000 reporting threshold. Recommendation: We recommend that Tacoma Arts Live implement more controls to ensure that payroll costs are sufficiently reviewed for accuracy and allowability. Views of Responsible Officials: Management agrees with the finding and recommendations set forth within and has developed a corrective action plan to address the instances of noncompliance identified and lapses in prescribed internal controls.