Audit 46706

Section II ? Financial Statement Findings 2022 ? 01 Meal Break Premiums Condition: Due to non-compliant meal, rest and recovery periods for employees, Meal Break Premiums were automatically generated by Paylocity software and were not identified as non-reimbursable costs during time card review by the appropriate staff. For detailed discussion see Section III. Section III ? Federal Award Findings and Questioned Costs US Department of Health and Human Services Passed through from County of San Diego Health and Human Services Agency CFDA # 93.959 2022 ? 01 Meal Break Premiums SIGNIFICANT DEFICIENCY/NONCOMPLIANCE Allowable Costs Condition: Due to non-compliant meal, rest and recovery periods for employees, Meal Break Premiums were automatically generated by Paylocity software and were not identified as non-reimbursable costs during time card review by the appropriate staff. Criteria: Internal controls should be in place that provide reasonable assurance that time submitted by employees is in compliance with all applicable labor laws and that time, including penalties assessed, are designated to appropriate programs and accounts. Additionally, policies and procedures should be in place to ensure compliance with meal, rest and recovery period laws and regulations. Effect: Time submitted by employees resulted in automatically generated meal break premiums which were not identified by the reviewing parties as non-reimbursable expenses and coded to program related payroll costs, resulting in questioned costs. Questioned Costs: $21,310. This amount was determined by totaling all Meal Break Premiums paid for the period July 1, 2021 through June 30, 2022 as reported by the payroll system. Cause: Due to a new time keeping systems and the staffing crisis caused by the COVID-19 Pandemic, a significant number of meal break premiums were required to be paid and the premiums were not allocated appropriately by the appropriate staff during their review of time cards. Recommendation: We recommend Management require additional training to Human Resources staff and supervisors regarding meal, rest and recovery period compliance and update their policies and procedures to ensure compliant breaks. In the event of a meal break premium that occurs as the direct result of patient care, appropriate documentation should be maintained by the organization. Meal Break premiums should be automatically coded as a non-reimbursable expense and any exceptions should be manually transferred to program expenses once appropriate supporting documentation is obtained. Views of Responsible Officials and Planned Corrective Actions: The Organization agrees with the finding and trainings, procedures and policies have been implemented to rectify the deficiency.

Section II ? Financial Statement Findings 2022 ? 01 Meal Break Premiums Condition: Due to non-compliant meal, rest and recovery periods for employees, Meal Break Premiums were automatically generated by Paylocity software and were not identified as non-reimbursable costs during time card review by the appropriate staff. For detailed discussion see Section III. Section III ? Federal Award Findings and Questioned Costs US Department of Health and Human Services Passed through from County of San Diego Health and Human Services Agency CFDA # 93.959 2022 ? 01 Meal Break Premiums SIGNIFICANT DEFICIENCY/NONCOMPLIANCE Allowable Costs Condition: Due to non-compliant meal, rest and recovery periods for employees, Meal Break Premiums were automatically generated by Paylocity software and were not identified as non-reimbursable costs during time card review by the appropriate staff. Criteria: Internal controls should be in place that provide reasonable assurance that time submitted by employees is in compliance with all applicable labor laws and that time, including penalties assessed, are designated to appropriate programs and accounts. Additionally, policies and procedures should be in place to ensure compliance with meal, rest and recovery period laws and regulations. Effect: Time submitted by employees resulted in automatically generated meal break premiums which were not identified by the reviewing parties as non-reimbursable expenses and coded to program related payroll costs, resulting in questioned costs. Questioned Costs: $21,310. This amount was determined by totaling all Meal Break Premiums paid for the period July 1, 2021 through June 30, 2022 as reported by the payroll system. Cause: Due to a new time keeping systems and the staffing crisis caused by the COVID-19 Pandemic, a significant number of meal break premiums were required to be paid and the premiums were not allocated appropriately by the appropriate staff during their review of time cards. Recommendation: We recommend Management require additional training to Human Resources staff and supervisors regarding meal, rest and recovery period compliance and update their policies and procedures to ensure compliant breaks. In the event of a meal break premium that occurs as the direct result of patient care, appropriate documentation should be maintained by the organization. Meal Break premiums should be automatically coded as a non-reimbursable expense and any exceptions should be manually transferred to program expenses once appropriate supporting documentation is obtained. Views of Responsible Officials and Planned Corrective Actions: The Organization agrees with the finding and trainings, procedures and policies have been implemented to rectify the deficiency.