FINDING 2023-001
Finding Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds -
Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Period of
Performance, and Procurement and Suspension and Debarment
Summary of Finding: (copied from SBOA Findings document provided)
The...
FINDING 2023-001
Finding Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds -
Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Period of
Performance, and Procurement and Suspension and Debarment
Summary of Finding: (copied from SBOA Findings document provided)
The Allen County Department of Health (Department of Health), a department within
Allen County, was awarded the Health Issues and Challenges grant through the Indiana
Department of Health financed through the American Rescue Plan Act (ARPA) for the
purpose of funding programs that focus on the improvement of chronic disease,
specifically, elevated blood lead level reduction. The Health Issues and Challenges
grant is a reimbursable grant, whereby the County received reimbursement on a percase
basis at a stated rate for Case Management and Environmental Investigation
activities performed. The Department of Health received federal receipts related to the
grant in the amount of $130,479 during 2023.
As part of sound management of the Federal award, the Department of Health was
responsible for implementing a system of internal control that would ensure compliance
with the applicable requirements.
The Department of Health did not properly design or implement such a system.
Receipts of the program were adequately identified through the use of an account
number within the County Health Fund (285) in the Allen County's ledger (ledger) which
was unique to the Health Issues and Challenges grant receipts. However, the ledger did
not adequately identify the expenditures of the grant program within the County Health
Fund. Through inquiry with the Department of Health employees and review of unitprepared
support of grant expenditures, we determined expenditures were made with
grant funds during the audit period, however, we were unable to distinguish between the
expenditures of the Health Issues and Challenges grant and all other activities of the
Department of Health in the County Health Fund.
Due to the lack of separate identification of expenditures in the financial records, we
were not able to establish a population from which to audit the Health Issues and
Challenges grant for compliance with the following compliance requirements of the
program:
Activities Allowed or Unallowed
Allowable Costs/Cost Principles
Period of Performance
Procurement and Suspension and Debarment
As such, the full award amount of $130,479, as reported on the Schedule of
Expenditures of Federal Awards, was determined to be questioned costs.
The lack of internal controls and noncompliance were systemic issues throughout the
audit period.
Recommendation:
We recommend that management of the Health Department establish a system of
internal controls to ensure that grant award funds are adequately accounted for and
tracked in such a manner as to determine the activity, receipts and disbursement,
associated with the grant.
…………………………
Contact Person Responsible for Corrective Action: JENNIFER MILLER (Finance
Director)
Contact Phone Number and Email Address: 260-449-7358
(Jennifer.miller@allencounty.us)
Views of Responsible Officials:
We concur with the finding
Explanation and Reasons for Disagreement:
N/A
Description of Corrective Action Plan:
When we were informed of the outcomes of the SBOA audit and the subsequent
needs for a corrective action plan (CAP) relative to their findings, we moved quickly
to begin the development of the CAP. We feel this finding/issue could be easily
remedied by following our normal procedure for grants, whereby we develop a new
fund, craft a Fund Ordinance for approval by the Allen County Commissioners to
establish said new fund, and then subsequently track all expenditures and
reimbursements in the separate fund vs. utilizing a line item for deposits in the main
Health Fund as was done with this grant (which lacked the ability to denote exact
salary expenditures and such next to each payment as it was all done within the
larger fund for all staff and expenses. We were not aware of this need.
THE PLAN (which will be added as a new “Grants” section in our existing Finance
Internal Controls policies):
For all grants (reimbursable or deliverables-based), once a contract is near
completion or upon execution, a separate fund will be created through
development and approval of a local fund ordinance. All expenditures allowed
by said grant and all reimbursements received by the grant funder will be
tracked solely and only within the separate grant fund that is tied to the signed
contract from the funder.
If there are staff payments for salaries or benefits being reimbursed by a grant,
we will ensure that: (1) the hours/minutes per staff member per pay period for
all work associated with these grant duties are tracked appropriately so as to
ensure we are invoicing the grant funder for the exact and accurate work
hours (regardless of whether or not the grant contract specifies this be
tracked or reimbursed per minute/hour, as most do not require this); and (2)
these amounts will be noted alongside the expenditures in the grant fund for
clarity upon invoicing or auditing.
Anticipated Completion Date:
We will follow this practice for any new grants accepted by the Allen County Department
of Health effective 9/17/2024. This is the standard practice for most grants we have
accepted, and therefore, we will not vary from this practice in the future even if given
permission to do so.