Pursuant to federal regulations, Uniform Administrative Requirements Section 200.511, the following is the internal control finding, as noted in the Delta Area Transit Authority, Michigan?s (the ?Transit?) Single Audit report for the year ended September 30, 2022, and the corrective action to be com...
Pursuant to federal regulations, Uniform Administrative Requirements Section 200.511, the following is the internal control finding, as noted in the Delta Area Transit Authority, Michigan?s (the ?Transit?) Single Audit report for the year ended September 30, 2022, and the corrective action to be completed: Finding: 2022-003 - Material weakness, internal controls over federal award (repeat finding) Auditor Description of Condition and Effect: Costs must meet certain general criteria to be allowable under federal awards. One criterion is that the costs be adequately documented. 9 of the 40 accounts payable expenses that were selected for testing included documentation showing that an individual with knowledge of the transaction reviewed the invoice to: verify that it was necessary and reasonable for the performance of the federal award, verify that it was accurate in amount, authorize the voucher for payment, or establish the appropriate general ledger code for posting. Further, none of the 45 payroll expenses that were selected for testing included employee timecards reviewed and authorized for payment by their immediate supervisor. Auditor Recommendation: We recommend that the Authority update its policies and procedures to provide documented proof of review and authorization by management of all expenses. These policies and procedures should be updated to conform with the Uniform Guidance as soon as practical. Corrective Action: We agree with the finding and will update and clarify our policies and implement new systematic review tools as protections against the payment of unsigned vouchers. Responsible Person: John Stapleton, Director Anticipated Completion Date: June 30, 2023