Criteria Part 2, CFR Part 200.430 notes “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed”. The document continues to state that documentation must “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Condition While performing tests of the Garden’s internal controls over payroll transactions, we noted the Garden had incorrectly allocated time of 8 of the 40 selections. Cause of Condition The Garden has not implemented proper internal control policies to adhere to the requirements of the Uniform Guidance. Effect of Condition Noncompliance may impact future funding from Federal awards. Recommendation We recommend the Garden implement proper internal control procedures to document hours worked, by employee, by grant; and maintain the documentation to support charges allocated to each Federal award.
Criteria Part 2, CFR Part 200.430 notes “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed”. The document continues to state that documentation must “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Condition While performing tests of the Garden’s internal controls over payroll transactions, we noted the Garden had incorrectly allocated time of 8 of the 40 selections. Cause of Condition The Garden has not implemented proper internal control policies to adhere to the requirements of the Uniform Guidance. Effect of Condition Noncompliance may impact future funding from Federal awards. Recommendation We recommend the Garden implement proper internal control procedures to document hours worked, by employee, by grant; and maintain the documentation to support charges allocated to each Federal award.
Criteria Part 2, CFR Part 200.430 notes “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed”. The document continues to state that documentation must “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Condition While performing tests of the Garden’s internal controls over payroll transactions, we noted the Garden had incorrectly allocated time of 8 of the 40 selections. Cause of Condition The Garden has not implemented proper internal control policies to adhere to the requirements of the Uniform Guidance. Effect of Condition Noncompliance may impact future funding from Federal awards. Recommendation We recommend the Garden implement proper internal control procedures to document hours worked, by employee, by grant; and maintain the documentation to support charges allocated to each Federal award.
Allowable Costs Questioned Costs: N/A Department of Labor 17.258 WIOA Adult Program (WAP) 17.259 WIOA Youth Program (WYP) 17.278 WIOA Dislocated Worker Program (DW) Grant No(s): AA-36322-21-55-A22, AA-38532-22-55-A-22 Criteria: Costs charged to Federal grants must meet the provisions of the standards for documentation of personnel expenses contained in 2 CFR 200.430(i)(1) which requires that charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. This would include supervisory approval of timesheets/records which accurately support the employee’s time for each pay period. Condition: Out of 20 employees’ time sheets/paychecks tested, 10 lacked supervisor approval. Universe/ Population: For a sample of 20 payroll charges totaling $25,786, we attempted to observe timesheets and their supervisory review to determine if proper internal controls were in place. Effect: Although further audit procedures indicated that the 10 employees’ costs were appropriately charged to the program, without proper internal controls over review and documentation of personnel expenses, appropriate levels of review may not occur, and therefore, the City-Parish may be at risk for unallowable costs being charged to the program. Cause: The lack of internal controls is a result of staff turnover, the COVID-19 pandemic, resource constraints and the lack of adherence to written policies and procedures to ensure compliance with federal requirements. Documentation of time sheet review and approval of a supervisor was not consistently maintained during the fiscal year. Recommendation: The WIOA (Employ BR) program should adhere to written policies and procedures that ensure that all salaries and wages and related benefit costs are charged to the Federal program based on records that reflect the work performed, which are reviewed and approved by a supervisor. This documentation of approval should be written and kept contemporaneously each pay period. View of Responsible Official: To improve the accuracy and timeliness of payroll processing, a revised payroll procedures manual will be developed and disseminated to all staff responsible for time approval. Additionally, mandatory training on the ExecuTime system will be conducted for these staff members to ensure they have the necessary skills for proper and timely time sheet approvals.
Allowable Costs Questioned Costs: N/A Department of Labor 17.258 WIOA Adult Program (WAP) 17.259 WIOA Youth Program (WYP) 17.278 WIOA Dislocated Worker Program (DW) Grant No(s): AA-36322-21-55-A22, AA-38532-22-55-A-22 Criteria: Costs charged to Federal grants must meet the provisions of the standards for documentation of personnel expenses contained in 2 CFR 200.430(i)(1) which requires that charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. This would include supervisory approval of timesheets/records which accurately support the employee’s time for each pay period. Condition: Out of 20 employees’ time sheets/paychecks tested, 10 lacked supervisor approval. Universe/ Population: For a sample of 20 payroll charges totaling $25,786, we attempted to observe timesheets and their supervisory review to determine if proper internal controls were in place. Effect: Although further audit procedures indicated that the 10 employees’ costs were appropriately charged to the program, without proper internal controls over review and documentation of personnel expenses, appropriate levels of review may not occur, and therefore, the City-Parish may be at risk for unallowable costs being charged to the program. Cause: The lack of internal controls is a result of staff turnover, the COVID-19 pandemic, resource constraints and the lack of adherence to written policies and procedures to ensure compliance with federal requirements. Documentation of time sheet review and approval of a supervisor was not consistently maintained during the fiscal year. Recommendation: The WIOA (Employ BR) program should adhere to written policies and procedures that ensure that all salaries and wages and related benefit costs are charged to the Federal program based on records that reflect the work performed, which are reviewed and approved by a supervisor. This documentation of approval should be written and kept contemporaneously each pay period. View of Responsible Official: To improve the accuracy and timeliness of payroll processing, a revised payroll procedures manual will be developed and disseminated to all staff responsible for time approval. Additionally, mandatory training on the ExecuTime system will be conducted for these staff members to ensure they have the necessary skills for proper and timely time sheet approvals.
Allowable Costs Questioned Costs: N/A Department of Labor 17.258 WIOA Adult Program (WAP) 17.259 WIOA Youth Program (WYP) 17.278 WIOA Dislocated Worker Program (DW) Grant No(s): AA-36322-21-55-A22, AA-38532-22-55-A-22 Criteria: Costs charged to Federal grants must meet the provisions of the standards for documentation of personnel expenses contained in 2 CFR 200.430(i)(1) which requires that charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. This would include supervisory approval of timesheets/records which accurately support the employee’s time for each pay period. Condition: Out of 20 employees’ time sheets/paychecks tested, 10 lacked supervisor approval. Universe/ Population: For a sample of 20 payroll charges totaling $25,786, we attempted to observe timesheets and their supervisory review to determine if proper internal controls were in place. Effect: Although further audit procedures indicated that the 10 employees’ costs were appropriately charged to the program, without proper internal controls over review and documentation of personnel expenses, appropriate levels of review may not occur, and therefore, the City-Parish may be at risk for unallowable costs being charged to the program. Cause: The lack of internal controls is a result of staff turnover, the COVID-19 pandemic, resource constraints and the lack of adherence to written policies and procedures to ensure compliance with federal requirements. Documentation of time sheet review and approval of a supervisor was not consistently maintained during the fiscal year. Recommendation: The WIOA (Employ BR) program should adhere to written policies and procedures that ensure that all salaries and wages and related benefit costs are charged to the Federal program based on records that reflect the work performed, which are reviewed and approved by a supervisor. This documentation of approval should be written and kept contemporaneously each pay period. View of Responsible Official: To improve the accuracy and timeliness of payroll processing, a revised payroll procedures manual will be developed and disseminated to all staff responsible for time approval. Additionally, mandatory training on the ExecuTime system will be conducted for these staff members to ensure they have the necessary skills for proper and timely time sheet approvals.
Finding 2023-001 - Significant Deficiency, Compliance Federal Assistance Listing Number. 21.027 U.S. Department Of Treasury State and Local Fiscal Recovery Funds – Allowable Costs Criteria: According to 2 CFR 200.430(i)(1)(vii) “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:….(vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity….”. Additionally, according to 2 CFR 200.413(a) “Cost incurred for the same purpose in like circumstances must be treated consistently as either direct or indirect (F&A) costs.” Condition: In our nonstatistical sample of 13 allowable cost selections we identified 2 payments that covered payroll costs that were not supported by sufficient documentation of time and effort for one employee. For select administrative employees for which time was allocated to the grant, the use of a fringe benefits rate included the allocation of rent built into the rate when rent was already billed as a direct cost. Context: Monthly payroll was billed to EnterpriseKC and to the grant by a related organization based on the time and effort tracked by the related organization for that month; however, it was noted that one employee’s full salary was billed to the grant and the time and effort spent on grant-related activities was less than full-time, with remaining time being spent on non-Federal award activities. Based on the employee’s time spent on the grant related activities the employee’s payroll costs billed to the grant for the 2 months evaluated was overbilled to the grant by $10,416. The related organization also billed EnterpriseKC and the grant for administrative employees’ time using an hourly billing rate that was determined by using the employees’ salaries divided by the standard hours worked plus an estimate of fringe benefits that ranged from 25% to 32%. The fringe benefits rate included allocation of rent expense which was already separately billed by the related organization as a direct cost. The actual fringe benefit rate excluding the rent was approximately 24% which resulted in estimated overbillings to the grant for the 2 months reviewed totaling $149. Effect: As a result of the overbillings noted, the grant expenditures were overstated by $10,565 for the questioned costs identified. Questioned Costs: Known questioned costs totaled $10,565. Additional likely questioned costs totaled $39,937 and were determined by allocating the percentage of known questioned costs as a percentage of the total costs included in the sample tested from the related organization multiplied by the total costs incurred with the related organization. It was not considered appropriate to project questioned costs to the remaining population of costs as the questioned costs were isolated to payroll related costs. Cause: EnterpriseKC did not have internal controls in place with sufficient precision to detect errors related to overbilling payroll costs to the grant. Further, EnterpriseKC did not have controls in place to ensure that direct costs billed to the grant were not duplicated by also being included in the payroll fringe rate. Identification Of Repeat Finding: This is not a repeat finding. Recommendation: We recommend that EnterpriseKC should ensure that any payroll costs for each individual employee allocated to the grant are supported by appropriate time and effort. We recommend that EnterpriseKC ensure that its billing rate for administrative employees only includes allocable fringe benefits and does not including any costs already separately billed as a direct cost. Views Of Responsible Officials (Unaudited): Management will implement a comprehensive time tracking review process that also extends to reviewing time for employees that choose to work remotely and will ensure that time not allocated to the grant is not included in the costs allocated to the grant. Management will revise the fringe benefit rate that gets charged to the hourly rates to ensure that none of the costs included in the fringe benefits are also direct expenses billed to the grant. The unallowable costs will be redirected to other allowable grant costs in 2024. Anticipated Completion Date: September 2024 Contact Person: Jay Konomos, Pillar Leader
Finding 2023-001 – Allocation of Fringe Benefits Federal Agency: U.S. Department of Health and Human Services Major Program: AL# 93.104 Comprehensive Community Mental Health Services for Children with Serious Emotional Disturbances (SED) Type of Finding: Significant deficiency in Internal Control over Compliance (Allowable Costs) Criteria: Per guidance: 2CFR 200.431 Compensation—fringe benefits.(i) (1) … Costs of severance pay are allowable only to the extent that in each case, it is required by (i) Law; (ii) Employer-employee agreement; (iii) Established policy that constitutes, in effect, an implied agreement on the non-Federal entity's part; or (iv) Circumstances of the particular employment. In accordance with 2 CFR 200.430(i), payroll costs charged to federal awards must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Condition: The Organization allocates fringe costs to grants based on budget while capturing actual costs in a fringe cost pool. During the audit we found that the fringe cost pool contained severance pay that exceeded the organization policy and thus unallowable. The removal of these costs resulted in the overcharging of fringe benefits to all projects. Questioned Costs: None Cause: Management does not have sufficient internal controls to ensure fringe benefits are allowable and that estimated fringe allocations represent with actual costs. Effect: Expenditures that are not properly identified within the accounting system or supported by underlying documentation are at risk of being owed back to the funding source. Recommendation: Management and those charged with governance should consider increasing controls around ensuring costs charged to the fringe pool are allowable under Uniform Guidance cost principles. The fringe allocation percentage for reimbursement should be reviewed and approved to ensure it represents actual direct costs incurred. This review should be documented and performed monthly (quarterly at minimum). Management’s Response: Management’s response to the finding is discussed in the attached Corrective Action Plan.
Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(i)(1), "charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program. Questioned costs Total questioned cost of $7,475 based on six payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Loval Recovery Fund grant (ALN 21.027). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a secondary control offsetting the program manager. Effect The Coronavirus State and Local Recovery Funds program and other federal programs could be incorrectly charged. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Repeat Finding Yes Auditor's Recommendation JSP recommends that the program manager and a member of the finance committee knowledge about 2 CFR 200.430(i)(1) review the executive director costs charged to the Coronavirus State and Local Recovery Funds program.
Finding 2023-001 – Allowable Costs/Cost Principles, Internal Control Identification of the federal program Assistance listing number and title: 93.493 Congressional Directives Agency: U.S. Department of Health and Human Services Federal award identification number (FAIN): H79FG000881 Federal award year: 2022 Criteria or specific requirement (including statutory, regulatory or other citation) 2 CFR 200.303(a) requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls would be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” 2 CFR 200.430(i)(1)(i) states that charges to Federal awards for salaries and wages must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. 2 CFR 200.430(i)(1)(v) also provides that salaries and wages must comply with the established accounting policies and practices of the non-Federal entity. Condition For four (4) of forty (40) payroll expenditures selected for testing, the System’s management did not perform the internal controls over the required allowability criteria. Cause The System failed to effectively implement controls over the required allowability criteria. Effect or potential effect Costs charged to Federal awards may be inaccurate, unallowable, or improperly allocated. Questioned costs None. Context From the population of payroll expenditures totaling $939,170, EY randomly selected 40 employees from different pay periods in 2023 totaling $94,279. Out of the 40 selections, 4 (or 10%) of employees’ timecards did not have evidence of manager’s review and approval of their time charged to the grant totaling $12,463 prior to processing payroll. Identification as a repeat finding, if applicable Not a repeat finding. Recommendation We recommend management to implement effective internal controls over the allowability of costs charged to the federal program. Management must ensure that costs charged to the federal program are adequately documented and reviewed. Views of responsible officials Management will implement an additional review and approval process. Staff assigned to grant activities will provide a screenshot of their bi-weekly timecard to their manager for review and approval. Upon manager review, the document will be forwarded to the grant program leadership team for approval and documentation.
Finding No. 2023-001: Allowable Costs/Cost Principles Program: AL# 10.331 - Gus Schumacher Nutrition Incentive Program (GUSNIP/GUCRR) Federal Grantor: U.S. Department of Agriculture Criteria – Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: I. Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; II. Be incorporated into the official records of the non-Federal entity; III. Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; IV. Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis; V. Comply with the established accounting policies and practices of the non-Federal entity; VI. Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non- Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Citation – 2 CFR 200.430 (i) Condition – Salary expense allocated and charged to Federal awards did not agree to timesheet reports that were signed by the employee and their direct supervisor. Additionally, timesheets were not properly approved by a supervisor. Cause – Budgeted rates were used to calculate the amount charged to the grant. Employees that worked exclusively on the grant covered by the Federal award had timesheets to support the time spent on the grant. Effect – The amount of salary expense and related fringe benefits charged to the Federal award did not meet the criteria outlined above. This leads to a risk that inaccurate charges could be made to the Federal award. Questioned Costs – None – the Organization was able to provide alternative methods to demonstrate that costs charged to the grant were less than actual amount incurred.Context - For 2 out of 4 employees tested, the salary allocated did not agree to the timesheet reports. Additionally, for 1 out 4 employees tested, the timesheet did not reflect a supervisor approval/signature as required by the Organization’s handbook policy. Repeat Finding - Yes - Finding 2022-003. Please see Summary Schedule of Prior Year Audit Findings. Recommendation - We recommend that the Organization follows policies and procedures to ensure compliance with proper payroll documentation. We also recommend that timesheets be used to support all allocations as the basis for recording salary to the books and used as the source of costs that get charged to Federal awards. Views of Responsible Officials - See Corrective Action Plan.
Finding No. 2023-001: Allowable Costs/Cost Principles Program: AL# 10.331 - Gus Schumacher Nutrition Incentive Program (GUSNIP/GUCRR) Federal Grantor: U.S. Department of Agriculture Criteria – Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: I. Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; II. Be incorporated into the official records of the non-Federal entity; III. Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; IV. Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis; V. Comply with the established accounting policies and practices of the non-Federal entity; VI. Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non- Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Citation – 2 CFR 200.430 (i) Condition – Salary expense allocated and charged to Federal awards did not agree to timesheet reports that were signed by the employee and their direct supervisor. Additionally, timesheets were not properly approved by a supervisor. Cause – Budgeted rates were used to calculate the amount charged to the grant. Employees that worked exclusively on the grant covered by the Federal award had timesheets to support the time spent on the grant. Effect – The amount of salary expense and related fringe benefits charged to the Federal award did not meet the criteria outlined above. This leads to a risk that inaccurate charges could be made to the Federal award. Questioned Costs – None – the Organization was able to provide alternative methods to demonstrate that costs charged to the grant were less than actual amount incurred.Context - For 2 out of 4 employees tested, the salary allocated did not agree to the timesheet reports. Additionally, for 1 out 4 employees tested, the timesheet did not reflect a supervisor approval/signature as required by the Organization’s handbook policy. Repeat Finding - Yes - Finding 2022-003. Please see Summary Schedule of Prior Year Audit Findings. Recommendation - We recommend that the Organization follows policies and procedures to ensure compliance with proper payroll documentation. We also recommend that timesheets be used to support all allocations as the basis for recording salary to the books and used as the source of costs that get charged to Federal awards. Views of Responsible Officials - See Corrective Action Plan.
2023-001. Allowable Costs/Cost Principles United States Department of Health and Human Services, Substance Abuse and Mental Health Services Administration: Substance Abuse and Mental Health Services Projects of Regional and National Significance Passed Through Vibrant Emotional Health: National Suicide Prevention Lifeline: 988 National Chat and Text Backup 93.243 S23-SM84816-048 988 National Backup Chat and Text Subnetwork 93.243 S24-SM84816-048-CTP 988 National Phone Backup 93.243 S23-SM84816-048 988 National Backup Phone Subnetwork 93.243 S24-SM84816-048-PB Disaster Distress Helpline: Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-048 Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-049 Disaster Distress Helpline Online Peer Support Center 93.243 S24-SM84816-048-DDH OPS Criteria: Uniform Guidance 2 CFR 200.430, covers standards for documentation of compensation-personal services. Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed and time spent. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, these records should support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and non-federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: Time records prepared by employees reflect the total hours worked for the day, but do not reflect the actual time spent on programs funded by a federal award, rather they are based on budgeted hours, and scheduled for true-up at a later date. Cause: The Organization allocates payroll to programs funded by awards based on the contract supported budget, which is based on an estimate of the time that work will be performed by individuals. At the time of the audit, the true-up of budgeted hours to actual hours worked had not been completed. Effect: Without time records, which are based on time worked to support the proper allocation of payroll, errors could occur and result in the Organization reporting and receiving reimbursement for the incorrect amount of payroll expenses. Identification of a Repeat Finding: This is not a repeat finding from a prior year audit. Questioned Costs: None reported. Recommendation: The Organization’s use of Personnel Activity Report (PAR) equivalent documentation, should allow each employee to accurately reflect the time work is performed, and serve as support for personnel expenses, funded by a federal award. Views of Responsible Officials and Planned Corrective Action Plan: The Organization agrees with the finding as indicated in the Organization’s corrective action plan, and has modified procedures to reflect actual time worked by employees on PAR equivalent documentation. This will serve as support for personnel expenses funded by a federal award.
2023-001. Allowable Costs/Cost Principles United States Department of Health and Human Services, Substance Abuse and Mental Health Services Administration: Substance Abuse and Mental Health Services Projects of Regional and National Significance Passed Through Vibrant Emotional Health: National Suicide Prevention Lifeline: 988 National Chat and Text Backup 93.243 S23-SM84816-048 988 National Backup Chat and Text Subnetwork 93.243 S24-SM84816-048-CTP 988 National Phone Backup 93.243 S23-SM84816-048 988 National Backup Phone Subnetwork 93.243 S24-SM84816-048-PB Disaster Distress Helpline: Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-048 Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-049 Disaster Distress Helpline Online Peer Support Center 93.243 S24-SM84816-048-DDH OPS Criteria: Uniform Guidance 2 CFR 200.430, covers standards for documentation of compensation-personal services. Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed and time spent. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, these records should support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and non-federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: Time records prepared by employees reflect the total hours worked for the day, but do not reflect the actual time spent on programs funded by a federal award, rather they are based on budgeted hours, and scheduled for true-up at a later date. Cause: The Organization allocates payroll to programs funded by awards based on the contract supported budget, which is based on an estimate of the time that work will be performed by individuals. At the time of the audit, the true-up of budgeted hours to actual hours worked had not been completed. Effect: Without time records, which are based on time worked to support the proper allocation of payroll, errors could occur and result in the Organization reporting and receiving reimbursement for the incorrect amount of payroll expenses. Identification of a Repeat Finding: This is not a repeat finding from a prior year audit. Questioned Costs: None reported. Recommendation: The Organization’s use of Personnel Activity Report (PAR) equivalent documentation, should allow each employee to accurately reflect the time work is performed, and serve as support for personnel expenses, funded by a federal award. Views of Responsible Officials and Planned Corrective Action Plan: The Organization agrees with the finding as indicated in the Organization’s corrective action plan, and has modified procedures to reflect actual time worked by employees on PAR equivalent documentation. This will serve as support for personnel expenses funded by a federal award.
2023-001. Allowable Costs/Cost Principles United States Department of Health and Human Services, Substance Abuse and Mental Health Services Administration: Substance Abuse and Mental Health Services Projects of Regional and National Significance Passed Through Vibrant Emotional Health: National Suicide Prevention Lifeline: 988 National Chat and Text Backup 93.243 S23-SM84816-048 988 National Backup Chat and Text Subnetwork 93.243 S24-SM84816-048-CTP 988 National Phone Backup 93.243 S23-SM84816-048 988 National Backup Phone Subnetwork 93.243 S24-SM84816-048-PB Disaster Distress Helpline: Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-048 Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-049 Disaster Distress Helpline Online Peer Support Center 93.243 S24-SM84816-048-DDH OPS Criteria: Uniform Guidance 2 CFR 200.430, covers standards for documentation of compensation-personal services. Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed and time spent. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, these records should support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and non-federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: Time records prepared by employees reflect the total hours worked for the day, but do not reflect the actual time spent on programs funded by a federal award, rather they are based on budgeted hours, and scheduled for true-up at a later date. Cause: The Organization allocates payroll to programs funded by awards based on the contract supported budget, which is based on an estimate of the time that work will be performed by individuals. At the time of the audit, the true-up of budgeted hours to actual hours worked had not been completed. Effect: Without time records, which are based on time worked to support the proper allocation of payroll, errors could occur and result in the Organization reporting and receiving reimbursement for the incorrect amount of payroll expenses. Identification of a Repeat Finding: This is not a repeat finding from a prior year audit. Questioned Costs: None reported. Recommendation: The Organization’s use of Personnel Activity Report (PAR) equivalent documentation, should allow each employee to accurately reflect the time work is performed, and serve as support for personnel expenses, funded by a federal award. Views of Responsible Officials and Planned Corrective Action Plan: The Organization agrees with the finding as indicated in the Organization’s corrective action plan, and has modified procedures to reflect actual time worked by employees on PAR equivalent documentation. This will serve as support for personnel expenses funded by a federal award.
2023-001. Allowable Costs/Cost Principles United States Department of Health and Human Services, Substance Abuse and Mental Health Services Administration: Substance Abuse and Mental Health Services Projects of Regional and National Significance Passed Through Vibrant Emotional Health: National Suicide Prevention Lifeline: 988 National Chat and Text Backup 93.243 S23-SM84816-048 988 National Backup Chat and Text Subnetwork 93.243 S24-SM84816-048-CTP 988 National Phone Backup 93.243 S23-SM84816-048 988 National Backup Phone Subnetwork 93.243 S24-SM84816-048-PB Disaster Distress Helpline: Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-048 Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-049 Disaster Distress Helpline Online Peer Support Center 93.243 S24-SM84816-048-DDH OPS Criteria: Uniform Guidance 2 CFR 200.430, covers standards for documentation of compensation-personal services. Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed and time spent. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, these records should support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and non-federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: Time records prepared by employees reflect the total hours worked for the day, but do not reflect the actual time spent on programs funded by a federal award, rather they are based on budgeted hours, and scheduled for true-up at a later date. Cause: The Organization allocates payroll to programs funded by awards based on the contract supported budget, which is based on an estimate of the time that work will be performed by individuals. At the time of the audit, the true-up of budgeted hours to actual hours worked had not been completed. Effect: Without time records, which are based on time worked to support the proper allocation of payroll, errors could occur and result in the Organization reporting and receiving reimbursement for the incorrect amount of payroll expenses. Identification of a Repeat Finding: This is not a repeat finding from a prior year audit. Questioned Costs: None reported. Recommendation: The Organization’s use of Personnel Activity Report (PAR) equivalent documentation, should allow each employee to accurately reflect the time work is performed, and serve as support for personnel expenses, funded by a federal award. Views of Responsible Officials and Planned Corrective Action Plan: The Organization agrees with the finding as indicated in the Organization’s corrective action plan, and has modified procedures to reflect actual time worked by employees on PAR equivalent documentation. This will serve as support for personnel expenses funded by a federal award.
2023-001. Allowable Costs/Cost Principles United States Department of Health and Human Services, Substance Abuse and Mental Health Services Administration: Substance Abuse and Mental Health Services Projects of Regional and National Significance Passed Through Vibrant Emotional Health: National Suicide Prevention Lifeline: 988 National Chat and Text Backup 93.243 S23-SM84816-048 988 National Backup Chat and Text Subnetwork 93.243 S24-SM84816-048-CTP 988 National Phone Backup 93.243 S23-SM84816-048 988 National Backup Phone Subnetwork 93.243 S24-SM84816-048-PB Disaster Distress Helpline: Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-048 Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-049 Disaster Distress Helpline Online Peer Support Center 93.243 S24-SM84816-048-DDH OPS Criteria: Uniform Guidance 2 CFR 200.430, covers standards for documentation of compensation-personal services. Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed and time spent. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, these records should support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and non-federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: Time records prepared by employees reflect the total hours worked for the day, but do not reflect the actual time spent on programs funded by a federal award, rather they are based on budgeted hours, and scheduled for true-up at a later date. Cause: The Organization allocates payroll to programs funded by awards based on the contract supported budget, which is based on an estimate of the time that work will be performed by individuals. At the time of the audit, the true-up of budgeted hours to actual hours worked had not been completed. Effect: Without time records, which are based on time worked to support the proper allocation of payroll, errors could occur and result in the Organization reporting and receiving reimbursement for the incorrect amount of payroll expenses. Identification of a Repeat Finding: This is not a repeat finding from a prior year audit. Questioned Costs: None reported. Recommendation: The Organization’s use of Personnel Activity Report (PAR) equivalent documentation, should allow each employee to accurately reflect the time work is performed, and serve as support for personnel expenses, funded by a federal award. Views of Responsible Officials and Planned Corrective Action Plan: The Organization agrees with the finding as indicated in the Organization’s corrective action plan, and has modified procedures to reflect actual time worked by employees on PAR equivalent documentation. This will serve as support for personnel expenses funded by a federal award.
2023-001. Allowable Costs/Cost Principles United States Department of Health and Human Services, Substance Abuse and Mental Health Services Administration: Substance Abuse and Mental Health Services Projects of Regional and National Significance Passed Through Vibrant Emotional Health: National Suicide Prevention Lifeline: 988 National Chat and Text Backup 93.243 S23-SM84816-048 988 National Backup Chat and Text Subnetwork 93.243 S24-SM84816-048-CTP 988 National Phone Backup 93.243 S23-SM84816-048 988 National Backup Phone Subnetwork 93.243 S24-SM84816-048-PB Disaster Distress Helpline: Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-048 Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-049 Disaster Distress Helpline Online Peer Support Center 93.243 S24-SM84816-048-DDH OPS Criteria: Uniform Guidance 2 CFR 200.430, covers standards for documentation of compensation-personal services. Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed and time spent. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, these records should support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and non-federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: Time records prepared by employees reflect the total hours worked for the day, but do not reflect the actual time spent on programs funded by a federal award, rather they are based on budgeted hours, and scheduled for true-up at a later date. Cause: The Organization allocates payroll to programs funded by awards based on the contract supported budget, which is based on an estimate of the time that work will be performed by individuals. At the time of the audit, the true-up of budgeted hours to actual hours worked had not been completed. Effect: Without time records, which are based on time worked to support the proper allocation of payroll, errors could occur and result in the Organization reporting and receiving reimbursement for the incorrect amount of payroll expenses. Identification of a Repeat Finding: This is not a repeat finding from a prior year audit. Questioned Costs: None reported. Recommendation: The Organization’s use of Personnel Activity Report (PAR) equivalent documentation, should allow each employee to accurately reflect the time work is performed, and serve as support for personnel expenses, funded by a federal award. Views of Responsible Officials and Planned Corrective Action Plan: The Organization agrees with the finding as indicated in the Organization’s corrective action plan, and has modified procedures to reflect actual time worked by employees on PAR equivalent documentation. This will serve as support for personnel expenses funded by a federal award.
2023-001. Allowable Costs/Cost Principles United States Department of Health and Human Services, Substance Abuse and Mental Health Services Administration: Substance Abuse and Mental Health Services Projects of Regional and National Significance Passed Through Vibrant Emotional Health: National Suicide Prevention Lifeline: 988 National Chat and Text Backup 93.243 S23-SM84816-048 988 National Backup Chat and Text Subnetwork 93.243 S24-SM84816-048-CTP 988 National Phone Backup 93.243 S23-SM84816-048 988 National Backup Phone Subnetwork 93.243 S24-SM84816-048-PB Disaster Distress Helpline: Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-048 Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-049 Disaster Distress Helpline Online Peer Support Center 93.243 S24-SM84816-048-DDH OPS Criteria: Uniform Guidance 2 CFR 200.430, covers standards for documentation of compensation-personal services. Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed and time spent. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, these records should support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and non-federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: Time records prepared by employees reflect the total hours worked for the day, but do not reflect the actual time spent on programs funded by a federal award, rather they are based on budgeted hours, and scheduled for true-up at a later date. Cause: The Organization allocates payroll to programs funded by awards based on the contract supported budget, which is based on an estimate of the time that work will be performed by individuals. At the time of the audit, the true-up of budgeted hours to actual hours worked had not been completed. Effect: Without time records, which are based on time worked to support the proper allocation of payroll, errors could occur and result in the Organization reporting and receiving reimbursement for the incorrect amount of payroll expenses. Identification of a Repeat Finding: This is not a repeat finding from a prior year audit. Questioned Costs: None reported. Recommendation: The Organization’s use of Personnel Activity Report (PAR) equivalent documentation, should allow each employee to accurately reflect the time work is performed, and serve as support for personnel expenses, funded by a federal award. Views of Responsible Officials and Planned Corrective Action Plan: The Organization agrees with the finding as indicated in the Organization’s corrective action plan, and has modified procedures to reflect actual time worked by employees on PAR equivalent documentation. This will serve as support for personnel expenses funded by a federal award.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Finding Number 2023-001 Internal Controls over Allowable Activities and Costs Criteria: 2 CFR Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Subpart D – Post-Federal Award Requirements Standards for Financial and Program Management Section 200.303, Internal controls states “The nonFederal” entity must: (1) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and terms and conditions of the Federal award. Section 200.430 (i) Standards for Documentation of Personnel Expenses states (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities…; (v) Comply with the established accounting policies and practices of the non-Federal entity…; (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity's written policies) are identified and entered into the records in a timely manner. Short term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity's system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: As per the grant agreement and the approved budget, there are no approved costs for occupancy and indirect costs. However, we noted during our testing there were a few expenditures related to the allocation of occupancy and national support (indirect costs) which are not allowed per the grant agreement. Additionally, management is charging salary expenses to the grant based on the estimated percentage on a monthly basis. The allocation methodology currently utilized is not supported with proper time and effort records. Cause: Certain controls related to the oversight of compliance are designed and implemented but are not effectively working. Also, evidence of time and effort is not properly documented. Effect: The lack of effective control over compliance resulted in an instance of noncompliance identified. In addition, not maintaining adequate supporting documentation for personnel cost is a violation of federal regulations which could result in unallowed payroll costs being charged to the federally funded program. Questioned Cost: Total expenditure of $13,960.20 did not comply with the compliance requirements. Context: During our review of 12 expenditures, 4 instances were identified where the costs did not meet the eligibility and allowability compliance requirements. During our review of 29 payroll expense items, we noted that payroll expenses charged to the program were based on estimates instead of actual time and effort.
Finding Number 2023-001 Internal Controls over Allowable Activities and Costs Criteria: 2 CFR Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Subpart D – Post-Federal Award Requirements Standards for Financial and Program Management Section 200.303, Internal controls states “The nonFederal” entity must: (1) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and terms and conditions of the Federal award. Section 200.430 (i) Standards for Documentation of Personnel Expenses states (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities…; (v) Comply with the established accounting policies and practices of the non-Federal entity…; (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity's written policies) are identified and entered into the records in a timely manner. Short term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity's system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: As per the grant agreement and the approved budget, there are no approved costs for occupancy and indirect costs. However, we noted during our testing there were a few expenditures related to the allocation of occupancy and national support (indirect costs) which are not allowed per the grant agreement. Additionally, management is charging salary expenses to the grant based on the estimated percentage on a monthly basis. The allocation methodology currently utilized is not supported with proper time and effort records. Cause: Certain controls related to the oversight of compliance are designed and implemented but are not effectively working. Also, evidence of time and effort is not properly documented. Effect: The lack of effective control over compliance resulted in an instance of noncompliance identified. In addition, not maintaining adequate supporting documentation for personnel cost is a violation of federal regulations which could result in unallowed payroll costs being charged to the federally funded program. Questioned Cost: Total expenditure of $13,960.20 did not comply with the compliance requirements. Context: During our review of 12 expenditures, 4 instances were identified where the costs did not meet the eligibility and allowability compliance requirements. During our review of 29 payroll expense items, we noted that payroll expenses charged to the program were based on estimates instead of actual time and effort.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.241, 14.267 Program: Housing Opportunities for Persons with AIDS, COVID-19 Housing Opportunities for Persons with AIDS, Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 558951, 570094, CA0802L9D012113, CA0802L9D012214, CA1348L9D012107, CA1348L9D012208, CA1510L9D012106, CA1510LD012207, CA1883L9D012102, CA1883L9D012203, HHI-23-03, HHI-24-09, HHI-23-13, HHI-24-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after the fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that the Village allocated payroll expenditures to Housing Opportunities for Persons with AIDS and the Continuum of Care Program during 2023 using allocations that lacked adequate support. During our testing we noted instances where employees did not track their actual time and effort for allocation to the grant, instances where the incorrect allocation rate was utilized, and/or allocations were not fully reviewed and approved. • For Housing Opportunities for Persons with AIDS: o 3 out of 60 selections had approved timesheet allocations that supported a lower rate than those utilized. o 1 out of 60 selections did not maintain a timesheet allocation. o 3 out of 60 selections did not maintain documentation of employee and/or supervisor approval of timesheet allocations. o 4 out of 60 selections had approved timesheet allocations that supported a higher rate than those utilized. • For the Continuum of Care Program: o 4 out of 83 selections did not maintain a timesheet allocation. o 2 out of 83 selections had approved timesheet allocations that supported a lower rate than those utilized. o 3 out of 83 selections did not match allocated timesheet hours to actual hours worked. Cause: The Village did not have adequate policies/procedures in place to ensure timesheet allocations are obtained for all employees charging time to federal grants and that they are appropriately reviewed and incorporated into calculations for amounts charged to federal grants. The Village relied heavily on manual processes which are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls to detect calculation errors and ensure that costs allocated to federal programs are supported, the Village could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Housing Opportunities for Persons with AIDS Known Questioned Costs: $881 Housing Opportunities for Persons with AIDS Likely Questioned Costs: $37,747 Continuum of Care Program Known Questioned Costs: $869 Continuum of Care Program Likely Questioned Costs: $144,388 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Housing Opportunities for Persons with AIDS in 2023 were $807,050. Total costs for the Continuum of Care Program in 2023 were $5,296,450. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Identification as a Repeat Finding: 2022-010, 2022-017 Recommendation: We recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. The Village should consistently obtain and retain timesheet allocation approvals from both employees and supervisors for each pay period requested for reimbursement. These records should be maintained until the grant is closed and required audits are completed. Views of Responsible Officials: Management agrees with the finding. Management is updating their written procedures to ensure that allowable costs and cost principles comply with §200.430 as well as enhancements to the time entry system and allocation procedures.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.241, 14.267 Program: Housing Opportunities for Persons with AIDS, COVID-19 Housing Opportunities for Persons with AIDS, Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 558951, 570094, CA0802L9D012113, CA0802L9D012214, CA1348L9D012107, CA1348L9D012208, CA1510L9D012106, CA1510LD012207, CA1883L9D012102, CA1883L9D012203, HHI-23-03, HHI-24-09, HHI-23-13, HHI-24-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after the fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that the Village allocated payroll expenditures to Housing Opportunities for Persons with AIDS and the Continuum of Care Program during 2023 using allocations that lacked adequate support. During our testing we noted instances where employees did not track their actual time and effort for allocation to the grant, instances where the incorrect allocation rate was utilized, and/or allocations were not fully reviewed and approved. • For Housing Opportunities for Persons with AIDS: o 3 out of 60 selections had approved timesheet allocations that supported a lower rate than those utilized. o 1 out of 60 selections did not maintain a timesheet allocation. o 3 out of 60 selections did not maintain documentation of employee and/or supervisor approval of timesheet allocations. o 4 out of 60 selections had approved timesheet allocations that supported a higher rate than those utilized. • For the Continuum of Care Program: o 4 out of 83 selections did not maintain a timesheet allocation. o 2 out of 83 selections had approved timesheet allocations that supported a lower rate than those utilized. o 3 out of 83 selections did not match allocated timesheet hours to actual hours worked. Cause: The Village did not have adequate policies/procedures in place to ensure timesheet allocations are obtained for all employees charging time to federal grants and that they are appropriately reviewed and incorporated into calculations for amounts charged to federal grants. The Village relied heavily on manual processes which are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls to detect calculation errors and ensure that costs allocated to federal programs are supported, the Village could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Housing Opportunities for Persons with AIDS Known Questioned Costs: $881 Housing Opportunities for Persons with AIDS Likely Questioned Costs: $37,747 Continuum of Care Program Known Questioned Costs: $869 Continuum of Care Program Likely Questioned Costs: $144,388 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Housing Opportunities for Persons with AIDS in 2023 were $807,050. Total costs for the Continuum of Care Program in 2023 were $5,296,450. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Identification as a Repeat Finding: 2022-010, 2022-017 Recommendation: We recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. The Village should consistently obtain and retain timesheet allocation approvals from both employees and supervisors for each pay period requested for reimbursement. These records should be maintained until the grant is closed and required audits are completed. Views of Responsible Officials: Management agrees with the finding. Management is updating their written procedures to ensure that allowable costs and cost principles comply with §200.430 as well as enhancements to the time entry system and allocation procedures.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.241, 14.267 Program: Housing Opportunities for Persons with AIDS, COVID-19 Housing Opportunities for Persons with AIDS, Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 558951, 570094, CA0802L9D012113, CA0802L9D012214, CA1348L9D012107, CA1348L9D012208, CA1510L9D012106, CA1510LD012207, CA1883L9D012102, CA1883L9D012203, HHI-23-03, HHI-24-09, HHI-23-13, HHI-24-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after the fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that the Village allocated payroll expenditures to Housing Opportunities for Persons with AIDS and the Continuum of Care Program during 2023 using allocations that lacked adequate support. During our testing we noted instances where employees did not track their actual time and effort for allocation to the grant, instances where the incorrect allocation rate was utilized, and/or allocations were not fully reviewed and approved. • For Housing Opportunities for Persons with AIDS: o 3 out of 60 selections had approved timesheet allocations that supported a lower rate than those utilized. o 1 out of 60 selections did not maintain a timesheet allocation. o 3 out of 60 selections did not maintain documentation of employee and/or supervisor approval of timesheet allocations. o 4 out of 60 selections had approved timesheet allocations that supported a higher rate than those utilized. • For the Continuum of Care Program: o 4 out of 83 selections did not maintain a timesheet allocation. o 2 out of 83 selections had approved timesheet allocations that supported a lower rate than those utilized. o 3 out of 83 selections did not match allocated timesheet hours to actual hours worked. Cause: The Village did not have adequate policies/procedures in place to ensure timesheet allocations are obtained for all employees charging time to federal grants and that they are appropriately reviewed and incorporated into calculations for amounts charged to federal grants. The Village relied heavily on manual processes which are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls to detect calculation errors and ensure that costs allocated to federal programs are supported, the Village could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Housing Opportunities for Persons with AIDS Known Questioned Costs: $881 Housing Opportunities for Persons with AIDS Likely Questioned Costs: $37,747 Continuum of Care Program Known Questioned Costs: $869 Continuum of Care Program Likely Questioned Costs: $144,388 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Housing Opportunities for Persons with AIDS in 2023 were $807,050. Total costs for the Continuum of Care Program in 2023 were $5,296,450. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Identification as a Repeat Finding: 2022-010, 2022-017 Recommendation: We recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. The Village should consistently obtain and retain timesheet allocation approvals from both employees and supervisors for each pay period requested for reimbursement. These records should be maintained until the grant is closed and required audits are completed. Views of Responsible Officials: Management agrees with the finding. Management is updating their written procedures to ensure that allowable costs and cost principles comply with §200.430 as well as enhancements to the time entry system and allocation procedures.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.241, 14.267 Program: Housing Opportunities for Persons with AIDS, COVID-19 Housing Opportunities for Persons with AIDS, Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 558951, 570094, CA0802L9D012113, CA0802L9D012214, CA1348L9D012107, CA1348L9D012208, CA1510L9D012106, CA1510LD012207, CA1883L9D012102, CA1883L9D012203, HHI-23-03, HHI-24-09, HHI-23-13, HHI-24-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after the fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that the Village allocated payroll expenditures to Housing Opportunities for Persons with AIDS and the Continuum of Care Program during 2023 using allocations that lacked adequate support. During our testing we noted instances where employees did not track their actual time and effort for allocation to the grant, instances where the incorrect allocation rate was utilized, and/or allocations were not fully reviewed and approved. • For Housing Opportunities for Persons with AIDS: o 3 out of 60 selections had approved timesheet allocations that supported a lower rate than those utilized. o 1 out of 60 selections did not maintain a timesheet allocation. o 3 out of 60 selections did not maintain documentation of employee and/or supervisor approval of timesheet allocations. o 4 out of 60 selections had approved timesheet allocations that supported a higher rate than those utilized. • For the Continuum of Care Program: o 4 out of 83 selections did not maintain a timesheet allocation. o 2 out of 83 selections had approved timesheet allocations that supported a lower rate than those utilized. o 3 out of 83 selections did not match allocated timesheet hours to actual hours worked. Cause: The Village did not have adequate policies/procedures in place to ensure timesheet allocations are obtained for all employees charging time to federal grants and that they are appropriately reviewed and incorporated into calculations for amounts charged to federal grants. The Village relied heavily on manual processes which are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls to detect calculation errors and ensure that costs allocated to federal programs are supported, the Village could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Housing Opportunities for Persons with AIDS Known Questioned Costs: $881 Housing Opportunities for Persons with AIDS Likely Questioned Costs: $37,747 Continuum of Care Program Known Questioned Costs: $869 Continuum of Care Program Likely Questioned Costs: $144,388 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Housing Opportunities for Persons with AIDS in 2023 were $807,050. Total costs for the Continuum of Care Program in 2023 were $5,296,450. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Identification as a Repeat Finding: 2022-010, 2022-017 Recommendation: We recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. The Village should consistently obtain and retain timesheet allocation approvals from both employees and supervisors for each pay period requested for reimbursement. These records should be maintained until the grant is closed and required audits are completed. Views of Responsible Officials: Management agrees with the finding. Management is updating their written procedures to ensure that allowable costs and cost principles comply with §200.430 as well as enhancements to the time entry system and allocation procedures.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.241, 14.267 Program: Housing Opportunities for Persons with AIDS, COVID-19 Housing Opportunities for Persons with AIDS, Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 558951, 570094, CA0802L9D012113, CA0802L9D012214, CA1348L9D012107, CA1348L9D012208, CA1510L9D012106, CA1510LD012207, CA1883L9D012102, CA1883L9D012203, HHI-23-03, HHI-24-09, HHI-23-13, HHI-24-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after the fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that the Village allocated payroll expenditures to Housing Opportunities for Persons with AIDS and the Continuum of Care Program during 2023 using allocations that lacked adequate support. During our testing we noted instances where employees did not track their actual time and effort for allocation to the grant, instances where the incorrect allocation rate was utilized, and/or allocations were not fully reviewed and approved. • For Housing Opportunities for Persons with AIDS: o 3 out of 60 selections had approved timesheet allocations that supported a lower rate than those utilized. o 1 out of 60 selections did not maintain a timesheet allocation. o 3 out of 60 selections did not maintain documentation of employee and/or supervisor approval of timesheet allocations. o 4 out of 60 selections had approved timesheet allocations that supported a higher rate than those utilized. • For the Continuum of Care Program: o 4 out of 83 selections did not maintain a timesheet allocation. o 2 out of 83 selections had approved timesheet allocations that supported a lower rate than those utilized. o 3 out of 83 selections did not match allocated timesheet hours to actual hours worked. Cause: The Village did not have adequate policies/procedures in place to ensure timesheet allocations are obtained for all employees charging time to federal grants and that they are appropriately reviewed and incorporated into calculations for amounts charged to federal grants. The Village relied heavily on manual processes which are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls to detect calculation errors and ensure that costs allocated to federal programs are supported, the Village could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Housing Opportunities for Persons with AIDS Known Questioned Costs: $881 Housing Opportunities for Persons with AIDS Likely Questioned Costs: $37,747 Continuum of Care Program Known Questioned Costs: $869 Continuum of Care Program Likely Questioned Costs: $144,388 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Housing Opportunities for Persons with AIDS in 2023 were $807,050. Total costs for the Continuum of Care Program in 2023 were $5,296,450. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Identification as a Repeat Finding: 2022-010, 2022-017 Recommendation: We recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. The Village should consistently obtain and retain timesheet allocation approvals from both employees and supervisors for each pay period requested for reimbursement. These records should be maintained until the grant is closed and required audits are completed. Views of Responsible Officials: Management agrees with the finding. Management is updating their written procedures to ensure that allowable costs and cost principles comply with §200.430 as well as enhancements to the time entry system and allocation procedures.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.241, 14.267 Program: Housing Opportunities for Persons with AIDS, COVID-19 Housing Opportunities for Persons with AIDS, Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 558951, 570094, CA0802L9D012113, CA0802L9D012214, CA1348L9D012107, CA1348L9D012208, CA1510L9D012106, CA1510LD012207, CA1883L9D012102, CA1883L9D012203, HHI-23-03, HHI-24-09, HHI-23-13, HHI-24-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after the fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that the Village allocated payroll expenditures to Housing Opportunities for Persons with AIDS and the Continuum of Care Program during 2023 using allocations that lacked adequate support. During our testing we noted instances where employees did not track their actual time and effort for allocation to the grant, instances where the incorrect allocation rate was utilized, and/or allocations were not fully reviewed and approved. • For Housing Opportunities for Persons with AIDS: o 3 out of 60 selections had approved timesheet allocations that supported a lower rate than those utilized. o 1 out of 60 selections did not maintain a timesheet allocation. o 3 out of 60 selections did not maintain documentation of employee and/or supervisor approval of timesheet allocations. o 4 out of 60 selections had approved timesheet allocations that supported a higher rate than those utilized. • For the Continuum of Care Program: o 4 out of 83 selections did not maintain a timesheet allocation. o 2 out of 83 selections had approved timesheet allocations that supported a lower rate than those utilized. o 3 out of 83 selections did not match allocated timesheet hours to actual hours worked. Cause: The Village did not have adequate policies/procedures in place to ensure timesheet allocations are obtained for all employees charging time to federal grants and that they are appropriately reviewed and incorporated into calculations for amounts charged to federal grants. The Village relied heavily on manual processes which are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls to detect calculation errors and ensure that costs allocated to federal programs are supported, the Village could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Housing Opportunities for Persons with AIDS Known Questioned Costs: $881 Housing Opportunities for Persons with AIDS Likely Questioned Costs: $37,747 Continuum of Care Program Known Questioned Costs: $869 Continuum of Care Program Likely Questioned Costs: $144,388 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Housing Opportunities for Persons with AIDS in 2023 were $807,050. Total costs for the Continuum of Care Program in 2023 were $5,296,450. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Identification as a Repeat Finding: 2022-010, 2022-017 Recommendation: We recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. The Village should consistently obtain and retain timesheet allocation approvals from both employees and supervisors for each pay period requested for reimbursement. These records should be maintained until the grant is closed and required audits are completed. Views of Responsible Officials: Management agrees with the finding. Management is updating their written procedures to ensure that allowable costs and cost principles comply with §200.430 as well as enhancements to the time entry system and allocation procedures.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.241, 14.267 Program: Housing Opportunities for Persons with AIDS, COVID-19 Housing Opportunities for Persons with AIDS, Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 558951, 570094, CA0802L9D012113, CA0802L9D012214, CA1348L9D012107, CA1348L9D012208, CA1510L9D012106, CA1510LD012207, CA1883L9D012102, CA1883L9D012203, HHI-23-03, HHI-24-09, HHI-23-13, HHI-24-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after the fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that the Village allocated payroll expenditures to Housing Opportunities for Persons with AIDS and the Continuum of Care Program during 2023 using allocations that lacked adequate support. During our testing we noted instances where employees did not track their actual time and effort for allocation to the grant, instances where the incorrect allocation rate was utilized, and/or allocations were not fully reviewed and approved. • For Housing Opportunities for Persons with AIDS: o 3 out of 60 selections had approved timesheet allocations that supported a lower rate than those utilized. o 1 out of 60 selections did not maintain a timesheet allocation. o 3 out of 60 selections did not maintain documentation of employee and/or supervisor approval of timesheet allocations. o 4 out of 60 selections had approved timesheet allocations that supported a higher rate than those utilized. • For the Continuum of Care Program: o 4 out of 83 selections did not maintain a timesheet allocation. o 2 out of 83 selections had approved timesheet allocations that supported a lower rate than those utilized. o 3 out of 83 selections did not match allocated timesheet hours to actual hours worked. Cause: The Village did not have adequate policies/procedures in place to ensure timesheet allocations are obtained for all employees charging time to federal grants and that they are appropriately reviewed and incorporated into calculations for amounts charged to federal grants. The Village relied heavily on manual processes which are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls to detect calculation errors and ensure that costs allocated to federal programs are supported, the Village could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Housing Opportunities for Persons with AIDS Known Questioned Costs: $881 Housing Opportunities for Persons with AIDS Likely Questioned Costs: $37,747 Continuum of Care Program Known Questioned Costs: $869 Continuum of Care Program Likely Questioned Costs: $144,388 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Housing Opportunities for Persons with AIDS in 2023 were $807,050. Total costs for the Continuum of Care Program in 2023 were $5,296,450. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Identification as a Repeat Finding: 2022-010, 2022-017 Recommendation: We recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. The Village should consistently obtain and retain timesheet allocation approvals from both employees and supervisors for each pay period requested for reimbursement. These records should be maintained until the grant is closed and required audits are completed. Views of Responsible Officials: Management agrees with the finding. Management is updating their written procedures to ensure that allowable costs and cost principles comply with §200.430 as well as enhancements to the time entry system and allocation procedures.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.241, 14.267 Program: Housing Opportunities for Persons with AIDS, COVID-19 Housing Opportunities for Persons with AIDS, Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 558951, 570094, CA0802L9D012113, CA0802L9D012214, CA1348L9D012107, CA1348L9D012208, CA1510L9D012106, CA1510LD012207, CA1883L9D012102, CA1883L9D012203, HHI-23-03, HHI-24-09, HHI-23-13, HHI-24-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after the fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that the Village allocated payroll expenditures to Housing Opportunities for Persons with AIDS and the Continuum of Care Program during 2023 using allocations that lacked adequate support. During our testing we noted instances where employees did not track their actual time and effort for allocation to the grant, instances where the incorrect allocation rate was utilized, and/or allocations were not fully reviewed and approved. • For Housing Opportunities for Persons with AIDS: o 3 out of 60 selections had approved timesheet allocations that supported a lower rate than those utilized. o 1 out of 60 selections did not maintain a timesheet allocation. o 3 out of 60 selections did not maintain documentation of employee and/or supervisor approval of timesheet allocations. o 4 out of 60 selections had approved timesheet allocations that supported a higher rate than those utilized. • For the Continuum of Care Program: o 4 out of 83 selections did not maintain a timesheet allocation. o 2 out of 83 selections had approved timesheet allocations that supported a lower rate than those utilized. o 3 out of 83 selections did not match allocated timesheet hours to actual hours worked. Cause: The Village did not have adequate policies/procedures in place to ensure timesheet allocations are obtained for all employees charging time to federal grants and that they are appropriately reviewed and incorporated into calculations for amounts charged to federal grants. The Village relied heavily on manual processes which are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls to detect calculation errors and ensure that costs allocated to federal programs are supported, the Village could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Housing Opportunities for Persons with AIDS Known Questioned Costs: $881 Housing Opportunities for Persons with AIDS Likely Questioned Costs: $37,747 Continuum of Care Program Known Questioned Costs: $869 Continuum of Care Program Likely Questioned Costs: $144,388 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Housing Opportunities for Persons with AIDS in 2023 were $807,050. Total costs for the Continuum of Care Program in 2023 were $5,296,450. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Identification as a Repeat Finding: 2022-010, 2022-017 Recommendation: We recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. The Village should consistently obtain and retain timesheet allocation approvals from both employees and supervisors for each pay period requested for reimbursement. These records should be maintained until the grant is closed and required audits are completed. Views of Responsible Officials: Management agrees with the finding. Management is updating their written procedures to ensure that allowable costs and cost principles comply with §200.430 as well as enhancements to the time entry system and allocation procedures.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.241, 14.267 Program: Housing Opportunities for Persons with AIDS, COVID-19 Housing Opportunities for Persons with AIDS, Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 558951, 570094, CA0802L9D012113, CA0802L9D012214, CA1348L9D012107, CA1348L9D012208, CA1510L9D012106, CA1510LD012207, CA1883L9D012102, CA1883L9D012203, HHI-23-03, HHI-24-09, HHI-23-13, HHI-24-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after the fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that the Village allocated payroll expenditures to Housing Opportunities for Persons with AIDS and the Continuum of Care Program during 2023 using allocations that lacked adequate support. During our testing we noted instances where employees did not track their actual time and effort for allocation to the grant, instances where the incorrect allocation rate was utilized, and/or allocations were not fully reviewed and approved. • For Housing Opportunities for Persons with AIDS: o 3 out of 60 selections had approved timesheet allocations that supported a lower rate than those utilized. o 1 out of 60 selections did not maintain a timesheet allocation. o 3 out of 60 selections did not maintain documentation of employee and/or supervisor approval of timesheet allocations. o 4 out of 60 selections had approved timesheet allocations that supported a higher rate than those utilized. • For the Continuum of Care Program: o 4 out of 83 selections did not maintain a timesheet allocation. o 2 out of 83 selections had approved timesheet allocations that supported a lower rate than those utilized. o 3 out of 83 selections did not match allocated timesheet hours to actual hours worked. Cause: The Village did not have adequate policies/procedures in place to ensure timesheet allocations are obtained for all employees charging time to federal grants and that they are appropriately reviewed and incorporated into calculations for amounts charged to federal grants. The Village relied heavily on manual processes which are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls to detect calculation errors and ensure that costs allocated to federal programs are supported, the Village could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Housing Opportunities for Persons with AIDS Known Questioned Costs: $881 Housing Opportunities for Persons with AIDS Likely Questioned Costs: $37,747 Continuum of Care Program Known Questioned Costs: $869 Continuum of Care Program Likely Questioned Costs: $144,388 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Housing Opportunities for Persons with AIDS in 2023 were $807,050. Total costs for the Continuum of Care Program in 2023 were $5,296,450. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Identification as a Repeat Finding: 2022-010, 2022-017 Recommendation: We recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. The Village should consistently obtain and retain timesheet allocation approvals from both employees and supervisors for each pay period requested for reimbursement. These records should be maintained until the grant is closed and required audits are completed. Views of Responsible Officials: Management agrees with the finding. Management is updating their written procedures to ensure that allowable costs and cost principles comply with §200.430 as well as enhancements to the time entry system and allocation procedures.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.241, 14.267 Program: Housing Opportunities for Persons with AIDS, COVID-19 Housing Opportunities for Persons with AIDS, Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 558951, 570094, CA0802L9D012113, CA0802L9D012214, CA1348L9D012107, CA1348L9D012208, CA1510L9D012106, CA1510LD012207, CA1883L9D012102, CA1883L9D012203, HHI-23-03, HHI-24-09, HHI-23-13, HHI-24-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after the fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that the Village allocated payroll expenditures to Housing Opportunities for Persons with AIDS and the Continuum of Care Program during 2023 using allocations that lacked adequate support. During our testing we noted instances where employees did not track their actual time and effort for allocation to the grant, instances where the incorrect allocation rate was utilized, and/or allocations were not fully reviewed and approved. • For Housing Opportunities for Persons with AIDS: o 3 out of 60 selections had approved timesheet allocations that supported a lower rate than those utilized. o 1 out of 60 selections did not maintain a timesheet allocation. o 3 out of 60 selections did not maintain documentation of employee and/or supervisor approval of timesheet allocations. o 4 out of 60 selections had approved timesheet allocations that supported a higher rate than those utilized. • For the Continuum of Care Program: o 4 out of 83 selections did not maintain a timesheet allocation. o 2 out of 83 selections had approved timesheet allocations that supported a lower rate than those utilized. o 3 out of 83 selections did not match allocated timesheet hours to actual hours worked. Cause: The Village did not have adequate policies/procedures in place to ensure timesheet allocations are obtained for all employees charging time to federal grants and that they are appropriately reviewed and incorporated into calculations for amounts charged to federal grants. The Village relied heavily on manual processes which are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls to detect calculation errors and ensure that costs allocated to federal programs are supported, the Village could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Housing Opportunities for Persons with AIDS Known Questioned Costs: $881 Housing Opportunities for Persons with AIDS Likely Questioned Costs: $37,747 Continuum of Care Program Known Questioned Costs: $869 Continuum of Care Program Likely Questioned Costs: $144,388 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Housing Opportunities for Persons with AIDS in 2023 were $807,050. Total costs for the Continuum of Care Program in 2023 were $5,296,450. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Identification as a Repeat Finding: 2022-010, 2022-017 Recommendation: We recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. The Village should consistently obtain and retain timesheet allocation approvals from both employees and supervisors for each pay period requested for reimbursement. These records should be maintained until the grant is closed and required audits are completed. Views of Responsible Officials: Management agrees with the finding. Management is updating their written procedures to ensure that allowable costs and cost principles comply with §200.430 as well as enhancements to the time entry system and allocation procedures.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.241, 14.267 Program: Housing Opportunities for Persons with AIDS, COVID-19 Housing Opportunities for Persons with AIDS, Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 558951, 570094, CA0802L9D012113, CA0802L9D012214, CA1348L9D012107, CA1348L9D012208, CA1510L9D012106, CA1510LD012207, CA1883L9D012102, CA1883L9D012203, HHI-23-03, HHI-24-09, HHI-23-13, HHI-24-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after the fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that the Village allocated payroll expenditures to Housing Opportunities for Persons with AIDS and the Continuum of Care Program during 2023 using allocations that lacked adequate support. During our testing we noted instances where employees did not track their actual time and effort for allocation to the grant, instances where the incorrect allocation rate was utilized, and/or allocations were not fully reviewed and approved. • For Housing Opportunities for Persons with AIDS: o 3 out of 60 selections had approved timesheet allocations that supported a lower rate than those utilized. o 1 out of 60 selections did not maintain a timesheet allocation. o 3 out of 60 selections did not maintain documentation of employee and/or supervisor approval of timesheet allocations. o 4 out of 60 selections had approved timesheet allocations that supported a higher rate than those utilized. • For the Continuum of Care Program: o 4 out of 83 selections did not maintain a timesheet allocation. o 2 out of 83 selections had approved timesheet allocations that supported a lower rate than those utilized. o 3 out of 83 selections did not match allocated timesheet hours to actual hours worked. Cause: The Village did not have adequate policies/procedures in place to ensure timesheet allocations are obtained for all employees charging time to federal grants and that they are appropriately reviewed and incorporated into calculations for amounts charged to federal grants. The Village relied heavily on manual processes which are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls to detect calculation errors and ensure that costs allocated to federal programs are supported, the Village could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Housing Opportunities for Persons with AIDS Known Questioned Costs: $881 Housing Opportunities for Persons with AIDS Likely Questioned Costs: $37,747 Continuum of Care Program Known Questioned Costs: $869 Continuum of Care Program Likely Questioned Costs: $144,388 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Housing Opportunities for Persons with AIDS in 2023 were $807,050. Total costs for the Continuum of Care Program in 2023 were $5,296,450. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Identification as a Repeat Finding: 2022-010, 2022-017 Recommendation: We recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. The Village should consistently obtain and retain timesheet allocation approvals from both employees and supervisors for each pay period requested for reimbursement. These records should be maintained until the grant is closed and required audits are completed. Views of Responsible Officials: Management agrees with the finding. Management is updating their written procedures to ensure that allowable costs and cost principles comply with §200.430 as well as enhancements to the time entry system and allocation procedures.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.241, 14.267 Program: Housing Opportunities for Persons with AIDS, COVID-19 Housing Opportunities for Persons with AIDS, Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 558951, 570094, CA0802L9D012113, CA0802L9D012214, CA1348L9D012107, CA1348L9D012208, CA1510L9D012106, CA1510LD012207, CA1883L9D012102, CA1883L9D012203, HHI-23-03, HHI-24-09, HHI-23-13, HHI-24-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after the fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that the Village allocated payroll expenditures to Housing Opportunities for Persons with AIDS and the Continuum of Care Program during 2023 using allocations that lacked adequate support. During our testing we noted instances where employees did not track their actual time and effort for allocation to the grant, instances where the incorrect allocation rate was utilized, and/or allocations were not fully reviewed and approved. • For Housing Opportunities for Persons with AIDS: o 3 out of 60 selections had approved timesheet allocations that supported a lower rate than those utilized. o 1 out of 60 selections did not maintain a timesheet allocation. o 3 out of 60 selections did not maintain documentation of employee and/or supervisor approval of timesheet allocations. o 4 out of 60 selections had approved timesheet allocations that supported a higher rate than those utilized. • For the Continuum of Care Program: o 4 out of 83 selections did not maintain a timesheet allocation. o 2 out of 83 selections had approved timesheet allocations that supported a lower rate than those utilized. o 3 out of 83 selections did not match allocated timesheet hours to actual hours worked. Cause: The Village did not have adequate policies/procedures in place to ensure timesheet allocations are obtained for all employees charging time to federal grants and that they are appropriately reviewed and incorporated into calculations for amounts charged to federal grants. The Village relied heavily on manual processes which are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls to detect calculation errors and ensure that costs allocated to federal programs are supported, the Village could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Housing Opportunities for Persons with AIDS Known Questioned Costs: $881 Housing Opportunities for Persons with AIDS Likely Questioned Costs: $37,747 Continuum of Care Program Known Questioned Costs: $869 Continuum of Care Program Likely Questioned Costs: $144,388 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Housing Opportunities for Persons with AIDS in 2023 were $807,050. Total costs for the Continuum of Care Program in 2023 were $5,296,450. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Identification as a Repeat Finding: 2022-010, 2022-017 Recommendation: We recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. The Village should consistently obtain and retain timesheet allocation approvals from both employees and supervisors for each pay period requested for reimbursement. These records should be maintained until the grant is closed and required audits are completed. Views of Responsible Officials: Management agrees with the finding. Management is updating their written procedures to ensure that allowable costs and cost principles comply with §200.430 as well as enhancements to the time entry system and allocation procedures.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.241, 14.267 Program: Housing Opportunities for Persons with AIDS, COVID-19 Housing Opportunities for Persons with AIDS, Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 558951, 570094, CA0802L9D012113, CA0802L9D012214, CA1348L9D012107, CA1348L9D012208, CA1510L9D012106, CA1510LD012207, CA1883L9D012102, CA1883L9D012203, HHI-23-03, HHI-24-09, HHI-23-13, HHI-24-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after the fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that the Village allocated payroll expenditures to Housing Opportunities for Persons with AIDS and the Continuum of Care Program during 2023 using allocations that lacked adequate support. During our testing we noted instances where employees did not track their actual time and effort for allocation to the grant, instances where the incorrect allocation rate was utilized, and/or allocations were not fully reviewed and approved. • For Housing Opportunities for Persons with AIDS: o 3 out of 60 selections had approved timesheet allocations that supported a lower rate than those utilized. o 1 out of 60 selections did not maintain a timesheet allocation. o 3 out of 60 selections did not maintain documentation of employee and/or supervisor approval of timesheet allocations. o 4 out of 60 selections had approved timesheet allocations that supported a higher rate than those utilized. • For the Continuum of Care Program: o 4 out of 83 selections did not maintain a timesheet allocation. o 2 out of 83 selections had approved timesheet allocations that supported a lower rate than those utilized. o 3 out of 83 selections did not match allocated timesheet hours to actual hours worked. Cause: The Village did not have adequate policies/procedures in place to ensure timesheet allocations are obtained for all employees charging time to federal grants and that they are appropriately reviewed and incorporated into calculations for amounts charged to federal grants. The Village relied heavily on manual processes which are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls to detect calculation errors and ensure that costs allocated to federal programs are supported, the Village could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Housing Opportunities for Persons with AIDS Known Questioned Costs: $881 Housing Opportunities for Persons with AIDS Likely Questioned Costs: $37,747 Continuum of Care Program Known Questioned Costs: $869 Continuum of Care Program Likely Questioned Costs: $144,388 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Housing Opportunities for Persons with AIDS in 2023 were $807,050. Total costs for the Continuum of Care Program in 2023 were $5,296,450. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Identification as a Repeat Finding: 2022-010, 2022-017 Recommendation: We recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. The Village should consistently obtain and retain timesheet allocation approvals from both employees and supervisors for each pay period requested for reimbursement. These records should be maintained until the grant is closed and required audits are completed. Views of Responsible Officials: Management agrees with the finding. Management is updating their written procedures to ensure that allowable costs and cost principles comply with §200.430 as well as enhancements to the time entry system and allocation procedures.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.241, 14.267 Program: Housing Opportunities for Persons with AIDS, COVID-19 Housing Opportunities for Persons with AIDS, Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 558951, 570094, CA0802L9D012113, CA0802L9D012214, CA1348L9D012107, CA1348L9D012208, CA1510L9D012106, CA1510LD012207, CA1883L9D012102, CA1883L9D012203, HHI-23-03, HHI-24-09, HHI-23-13, HHI-24-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after the fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that the Village allocated payroll expenditures to Housing Opportunities for Persons with AIDS and the Continuum of Care Program during 2023 using allocations that lacked adequate support. During our testing we noted instances where employees did not track their actual time and effort for allocation to the grant, instances where the incorrect allocation rate was utilized, and/or allocations were not fully reviewed and approved. • For Housing Opportunities for Persons with AIDS: o 3 out of 60 selections had approved timesheet allocations that supported a lower rate than those utilized. o 1 out of 60 selections did not maintain a timesheet allocation. o 3 out of 60 selections did not maintain documentation of employee and/or supervisor approval of timesheet allocations. o 4 out of 60 selections had approved timesheet allocations that supported a higher rate than those utilized. • For the Continuum of Care Program: o 4 out of 83 selections did not maintain a timesheet allocation. o 2 out of 83 selections had approved timesheet allocations that supported a lower rate than those utilized. o 3 out of 83 selections did not match allocated timesheet hours to actual hours worked. Cause: The Village did not have adequate policies/procedures in place to ensure timesheet allocations are obtained for all employees charging time to federal grants and that they are appropriately reviewed and incorporated into calculations for amounts charged to federal grants. The Village relied heavily on manual processes which are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls to detect calculation errors and ensure that costs allocated to federal programs are supported, the Village could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Housing Opportunities for Persons with AIDS Known Questioned Costs: $881 Housing Opportunities for Persons with AIDS Likely Questioned Costs: $37,747 Continuum of Care Program Known Questioned Costs: $869 Continuum of Care Program Likely Questioned Costs: $144,388 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Housing Opportunities for Persons with AIDS in 2023 were $807,050. Total costs for the Continuum of Care Program in 2023 were $5,296,450. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Identification as a Repeat Finding: 2022-010, 2022-017 Recommendation: We recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. The Village should consistently obtain and retain timesheet allocation approvals from both employees and supervisors for each pay period requested for reimbursement. These records should be maintained until the grant is closed and required audits are completed. Views of Responsible Officials: Management agrees with the finding. Management is updating their written procedures to ensure that allowable costs and cost principles comply with §200.430 as well as enhancements to the time entry system and allocation procedures.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.241, 14.267 Program: Housing Opportunities for Persons with AIDS, COVID-19 Housing Opportunities for Persons with AIDS, Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 558951, 570094, CA0802L9D012113, CA0802L9D012214, CA1348L9D012107, CA1348L9D012208, CA1510L9D012106, CA1510LD012207, CA1883L9D012102, CA1883L9D012203, HHI-23-03, HHI-24-09, HHI-23-13, HHI-24-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after the fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that the Village allocated payroll expenditures to Housing Opportunities for Persons with AIDS and the Continuum of Care Program during 2023 using allocations that lacked adequate support. During our testing we noted instances where employees did not track their actual time and effort for allocation to the grant, instances where the incorrect allocation rate was utilized, and/or allocations were not fully reviewed and approved. • For Housing Opportunities for Persons with AIDS: o 3 out of 60 selections had approved timesheet allocations that supported a lower rate than those utilized. o 1 out of 60 selections did not maintain a timesheet allocation. o 3 out of 60 selections did not maintain documentation of employee and/or supervisor approval of timesheet allocations. o 4 out of 60 selections had approved timesheet allocations that supported a higher rate than those utilized. • For the Continuum of Care Program: o 4 out of 83 selections did not maintain a timesheet allocation. o 2 out of 83 selections had approved timesheet allocations that supported a lower rate than those utilized. o 3 out of 83 selections did not match allocated timesheet hours to actual hours worked. Cause: The Village did not have adequate policies/procedures in place to ensure timesheet allocations are obtained for all employees charging time to federal grants and that they are appropriately reviewed and incorporated into calculations for amounts charged to federal grants. The Village relied heavily on manual processes which are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls to detect calculation errors and ensure that costs allocated to federal programs are supported, the Village could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Housing Opportunities for Persons with AIDS Known Questioned Costs: $881 Housing Opportunities for Persons with AIDS Likely Questioned Costs: $37,747 Continuum of Care Program Known Questioned Costs: $869 Continuum of Care Program Likely Questioned Costs: $144,388 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Housing Opportunities for Persons with AIDS in 2023 were $807,050. Total costs for the Continuum of Care Program in 2023 were $5,296,450. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Identification as a Repeat Finding: 2022-010, 2022-017 Recommendation: We recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. The Village should consistently obtain and retain timesheet allocation approvals from both employees and supervisors for each pay period requested for reimbursement. These records should be maintained until the grant is closed and required audits are completed. Views of Responsible Officials: Management agrees with the finding. Management is updating their written procedures to ensure that allowable costs and cost principles comply with §200.430 as well as enhancements to the time entry system and allocation procedures.