Finding The County charges 49.5 percent of salaries for certain full-time employees to the Aging Cluster program. Even though this is less than the actual percentage of time that could be charged to the grant, there is no time and effort reporting to substantiate the amount of time the individuals actually work on grant related activity. Additionally, the County charged salaries for part-time employees to the Aging Cluster program , but did not maintain time and effort reports or other required documentation to substantiate the work performed on grant-related activities. According to OMB Uniform Guidance (2 CFR Part 200) §200.430(i), salary and wage charges to federal grants must be supported by records that accurately reflect the time and effort expended on grant-related activities. This applies to all employees whose salaries are charged in whole or in part to the grant, including part-time employees. Recommendation The County should establish and implement a policy requiring documentation to support all salary charges to grants. This should include time and effort reporting or equivalent justifications of payroll charges to ensure compliance with federal requirements.
Finding The County charges 49.5 percent of salaries for certain full-time employees to the Aging Cluster program. Even though this is less than the actual percentage of time that could be charged to the grant, there is no time and effort reporting to substantiate the amount of time the individuals actually work on grant related activity. Additionally, the County charged salaries for part-time employees to the Aging Cluster program , but did not maintain time and effort reports or other required documentation to substantiate the work performed on grant-related activities. According to OMB Uniform Guidance (2 CFR Part 200) §200.430(i), salary and wage charges to federal grants must be supported by records that accurately reflect the time and effort expended on grant-related activities. This applies to all employees whose salaries are charged in whole or in part to the grant, including part-time employees. Recommendation The County should establish and implement a policy requiring documentation to support all salary charges to grants. This should include time and effort reporting or equivalent justifications of payroll charges to ensure compliance with federal requirements.
Finding The County charges 49.5 percent of salaries for certain full-time employees to the Aging Cluster program. Even though this is less than the actual percentage of time that could be charged to the grant, there is no time and effort reporting to substantiate the amount of time the individuals actually work on grant related activity. Additionally, the County charged salaries for part-time employees to the Aging Cluster program , but did not maintain time and effort reports or other required documentation to substantiate the work performed on grant-related activities. According to OMB Uniform Guidance (2 CFR Part 200) §200.430(i), salary and wage charges to federal grants must be supported by records that accurately reflect the time and effort expended on grant-related activities. This applies to all employees whose salaries are charged in whole or in part to the grant, including part-time employees. Recommendation The County should establish and implement a policy requiring documentation to support all salary charges to grants. This should include time and effort reporting or equivalent justifications of payroll charges to ensure compliance with federal requirements.
Finding The County charges 49.5 percent of salaries for certain full-time employees to the Aging Cluster program. Even though this is less than the actual percentage of time that could be charged to the grant, there is no time and effort reporting to substantiate the amount of time the individuals actually work on grant related activity. Additionally, the County charged salaries for part-time employees to the Aging Cluster program , but did not maintain time and effort reports or other required documentation to substantiate the work performed on grant-related activities. According to OMB Uniform Guidance (2 CFR Part 200) §200.430(i), salary and wage charges to federal grants must be supported by records that accurately reflect the time and effort expended on grant-related activities. This applies to all employees whose salaries are charged in whole or in part to the grant, including part-time employees. Recommendation The County should establish and implement a policy requiring documentation to support all salary charges to grants. This should include time and effort reporting or equivalent justifications of payroll charges to ensure compliance with federal requirements.
Finding The County charges 49.5 percent of salaries for certain full-time employees to the Aging Cluster program. Even though this is less than the actual percentage of time that could be charged to the grant, there is no time and effort reporting to substantiate the amount of time the individuals actually work on grant related activity. Additionally, the County charged salaries for part-time employees to the Aging Cluster program , but did not maintain time and effort reports or other required documentation to substantiate the work performed on grant-related activities. According to OMB Uniform Guidance (2 CFR Part 200) §200.430(i), salary and wage charges to federal grants must be supported by records that accurately reflect the time and effort expended on grant-related activities. This applies to all employees whose salaries are charged in whole or in part to the grant, including part-time employees. Recommendation The County should establish and implement a policy requiring documentation to support all salary charges to grants. This should include time and effort reporting or equivalent justifications of payroll charges to ensure compliance with federal requirements.
Finding The County charges 49.5 percent of salaries for certain full-time employees to the Aging Cluster program. Even though this is less than the actual percentage of time that could be charged to the grant, there is no time and effort reporting to substantiate the amount of time the individuals actually work on grant related activity. Additionally, the County charged salaries for part-time employees to the Aging Cluster program , but did not maintain time and effort reports or other required documentation to substantiate the work performed on grant-related activities. According to OMB Uniform Guidance (2 CFR Part 200) §200.430(i), salary and wage charges to federal grants must be supported by records that accurately reflect the time and effort expended on grant-related activities. This applies to all employees whose salaries are charged in whole or in part to the grant, including part-time employees. Recommendation The County should establish and implement a policy requiring documentation to support all salary charges to grants. This should include time and effort reporting or equivalent justifications of payroll charges to ensure compliance with federal requirements.
Finding The County charges 49.5 percent of salaries for certain full-time employees to the Aging Cluster program. Even though this is less than the actual percentage of time that could be charged to the grant, there is no time and effort reporting to substantiate the amount of time the individuals actually work on grant related activity. Additionally, the County charged salaries for part-time employees to the Aging Cluster program , but did not maintain time and effort reports or other required documentation to substantiate the work performed on grant-related activities. According to OMB Uniform Guidance (2 CFR Part 200) §200.430(i), salary and wage charges to federal grants must be supported by records that accurately reflect the time and effort expended on grant-related activities. This applies to all employees whose salaries are charged in whole or in part to the grant, including part-time employees. Recommendation The County should establish and implement a policy requiring documentation to support all salary charges to grants. This should include time and effort reporting or equivalent justifications of payroll charges to ensure compliance with federal requirements.
Finding The County charges 49.5 percent of salaries for certain full-time employees to the Aging Cluster program. Even though this is less than the actual percentage of time that could be charged to the grant, there is no time and effort reporting to substantiate the amount of time the individuals actually work on grant related activity. Additionally, the County charged salaries for part-time employees to the Aging Cluster program , but did not maintain time and effort reports or other required documentation to substantiate the work performed on grant-related activities. According to OMB Uniform Guidance (2 CFR Part 200) §200.430(i), salary and wage charges to federal grants must be supported by records that accurately reflect the time and effort expended on grant-related activities. This applies to all employees whose salaries are charged in whole or in part to the grant, including part-time employees. Recommendation The County should establish and implement a policy requiring documentation to support all salary charges to grants. This should include time and effort reporting or equivalent justifications of payroll charges to ensure compliance with federal requirements.
Finding The County charges 49.5 percent of salaries for certain full-time employees to the Aging Cluster program. Even though this is less than the actual percentage of time that could be charged to the grant, there is no time and effort reporting to substantiate the amount of time the individuals actually work on grant related activity. Additionally, the County charged salaries for part-time employees to the Aging Cluster program , but did not maintain time and effort reports or other required documentation to substantiate the work performed on grant-related activities. According to OMB Uniform Guidance (2 CFR Part 200) §200.430(i), salary and wage charges to federal grants must be supported by records that accurately reflect the time and effort expended on grant-related activities. This applies to all employees whose salaries are charged in whole or in part to the grant, including part-time employees. Recommendation The County should establish and implement a policy requiring documentation to support all salary charges to grants. This should include time and effort reporting or equivalent justifications of payroll charges to ensure compliance with federal requirements.
Finding The County charges 49.5 percent of salaries for certain full-time employees to the Aging Cluster program. Even though this is less than the actual percentage of time that could be charged to the grant, there is no time and effort reporting to substantiate the amount of time the individuals actually work on grant related activity. Additionally, the County charged salaries for part-time employees to the Aging Cluster program , but did not maintain time and effort reports or other required documentation to substantiate the work performed on grant-related activities. According to OMB Uniform Guidance (2 CFR Part 200) §200.430(i), salary and wage charges to federal grants must be supported by records that accurately reflect the time and effort expended on grant-related activities. This applies to all employees whose salaries are charged in whole or in part to the grant, including part-time employees. Recommendation The County should establish and implement a policy requiring documentation to support all salary charges to grants. This should include time and effort reporting or equivalent justifications of payroll charges to ensure compliance with federal requirements.
Finding The County charges 49.5 percent of salaries for certain full-time employees to the Aging Cluster program. Even though this is less than the actual percentage of time that could be charged to the grant, there is no time and effort reporting to substantiate the amount of time the individuals actually work on grant related activity. Additionally, the County charged salaries for part-time employees to the Aging Cluster program , but did not maintain time and effort reports or other required documentation to substantiate the work performed on grant-related activities. According to OMB Uniform Guidance (2 CFR Part 200) §200.430(i), salary and wage charges to federal grants must be supported by records that accurately reflect the time and effort expended on grant-related activities. This applies to all employees whose salaries are charged in whole or in part to the grant, including part-time employees. Recommendation The County should establish and implement a policy requiring documentation to support all salary charges to grants. This should include time and effort reporting or equivalent justifications of payroll charges to ensure compliance with federal requirements.
ALN Title and Number COVID-19 Coronavirus State and Local Fiscal Recovery Funds, AL #21.027 Federal Award Number and Year 2023 Federal Agency United States Department of the Treasury Pass-Through Entity Ohio Department of Public Safety Repeat Finding from Prior Audit? No Finding Number (if repeat) N/A Finding 2023-004 – Material Weakness/Noncompliance – Allowable Costs/Cost Principals and Suspension and Debarment 2 CFR 200 outlines the following policies required for a County spending Coronavirus State and Local Fiscal Recovery Funds: • 2 CFR 200.302(b)(7) for determining the allowability of costs in accordance with Subpart E-Cost Principles; • 2 CFR 200.430 for allowability of compensation costs; 2 CFR 200.464(a)(2) for reimbursement of relocation costs; • 2 CFR 200.318(c)(1) for employee conflicts of interest; • 2 CFR 200.318(c)(2) for organizational conflicts of interest; • 2 CFR 200.320(b)(2) for selection and awarding of contracts for competitive proposals; • 2 CFR 200.319(d) for minimum evaluation criteria for bids and proposals. During testing we noted that the County did not have sufficient written policies addressing the above requirements. Failure to adopt and implement policies could lead to noncompliance with federal requirements. We recommend the County approve and implement the above policies to ensure compliance with federal requirements.
ALN Title and Number COVID-19 Coronavirus State and Local Fiscal Recovery Funds, AL #21.027 Federal Award Number and Year 2023 Federal Agency United States Department of the Treasury Pass-Through Entity Ohio Department of Public Safety Repeat Finding from Prior Audit? No Finding Number (if repeat) N/A Finding 2023-004 – Material Weakness/Noncompliance – Allowable Costs/Cost Principals and Suspension and Debarment 2 CFR 200 outlines the following policies required for a County spending Coronavirus State and Local Fiscal Recovery Funds: • 2 CFR 200.302(b)(7) for determining the allowability of costs in accordance with Subpart E-Cost Principles; • 2 CFR 200.430 for allowability of compensation costs; 2 CFR 200.464(a)(2) for reimbursement of relocation costs; • 2 CFR 200.318(c)(1) for employee conflicts of interest; • 2 CFR 200.318(c)(2) for organizational conflicts of interest; • 2 CFR 200.320(b)(2) for selection and awarding of contracts for competitive proposals; • 2 CFR 200.319(d) for minimum evaluation criteria for bids and proposals. During testing we noted that the County did not have sufficient written policies addressing the above requirements. Failure to adopt and implement policies could lead to noncompliance with federal requirements. We recommend the County approve and implement the above policies to ensure compliance with federal requirements.
ALN Title and Number COVID-19 Coronavirus State and Local Fiscal Recovery Funds, AL #21.027 Federal Award Number and Year 2023 Federal Agency United States Department of the Treasury Pass-Through Entity Ohio Department of Public Safety Repeat Finding from Prior Audit? No Finding Number (if repeat) N/A Finding 2023-004 – Material Weakness/Noncompliance – Allowable Costs/Cost Principals and Suspension and Debarment 2 CFR 200 outlines the following policies required for a County spending Coronavirus State and Local Fiscal Recovery Funds: • 2 CFR 200.302(b)(7) for determining the allowability of costs in accordance with Subpart E-Cost Principles; • 2 CFR 200.430 for allowability of compensation costs; 2 CFR 200.464(a)(2) for reimbursement of relocation costs; • 2 CFR 200.318(c)(1) for employee conflicts of interest; • 2 CFR 200.318(c)(2) for organizational conflicts of interest; • 2 CFR 200.320(b)(2) for selection and awarding of contracts for competitive proposals; • 2 CFR 200.319(d) for minimum evaluation criteria for bids and proposals. During testing we noted that the County did not have sufficient written policies addressing the above requirements. Failure to adopt and implement policies could lead to noncompliance with federal requirements. We recommend the County approve and implement the above policies to ensure compliance with federal requirements.
ALN Title and Number COVID-19 Coronavirus State and Local Fiscal Recovery Funds, AL #21.027 Federal Award Number and Year 2023 Federal Agency United States Department of the Treasury Pass-Through Entity Ohio Department of Public Safety Repeat Finding from Prior Audit? No Finding Number (if repeat) N/A Finding 2023-004 – Material Weakness/Noncompliance – Allowable Costs/Cost Principals and Suspension and Debarment 2 CFR 200 outlines the following policies required for a County spending Coronavirus State and Local Fiscal Recovery Funds: • 2 CFR 200.302(b)(7) for determining the allowability of costs in accordance with Subpart E-Cost Principles; • 2 CFR 200.430 for allowability of compensation costs; 2 CFR 200.464(a)(2) for reimbursement of relocation costs; • 2 CFR 200.318(c)(1) for employee conflicts of interest; • 2 CFR 200.318(c)(2) for organizational conflicts of interest; • 2 CFR 200.320(b)(2) for selection and awarding of contracts for competitive proposals; • 2 CFR 200.319(d) for minimum evaluation criteria for bids and proposals. During testing we noted that the County did not have sufficient written policies addressing the above requirements. Failure to adopt and implement policies could lead to noncompliance with federal requirements. We recommend the County approve and implement the above policies to ensure compliance with federal requirements.
U.S. Department of Health and Human Services, passed through Kansas Department of Aging Aging Cluster - ALN 93.045 - Special Programs for the Aging _Title III, Part C_Nutrition Services - 2301KSOAHD Criteria or Specific Requirement – Allowable Costs/Cost Principles and Material Weakness Federal regulations state that “charges to federal awards for salaries and wages, must be based on records that accurately reflect the work performed.” The regulations also state that “the records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and property allocated” and “budget estimates alone do not qualify as support for charges to federal awards” (2 CFR 200.430(i)). Per 2 CFR 200.303, the non-Federal entities receiving federal awards (i.e., auditee management) establish and maintain internal control design to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: During our test work over the ALN 93.045 grant, we noted the Unified Government did not have time and activity records with sufficient detail per federal regulations document to support its compensation and fringe benefit expenses. Questioned Costs: Total questioned costs of $200,949 were identified as a result of lack of proper documentation to support the charge and allocation to the grant. Context: We selected a sample of 60 charges totaling $16,075 to the Aging Cluster grants related to salaries and benefits expenditures. Within our sample, none of the 60 selections had proper documentation to support allocation to the grant. Per discussions with management and further review, the amounts charged to the grant were based on the approved budget for the position and the internal allocation performed each payroll period. Salaries and benefits charged to the entire cluster in the audit period totaled $200,949 and represented 14% of the total grant expenditures for the period. The sample was not intended to be, and was not, a statistically valid sample. Identification of Prior Year Finding: 2022-019 Effect: Based on testing completed, the Unified Government did not have sufficient procedures to allocate salaries and fringe benefits activity related to Aging Cluster throughout fiscal year 2023. Cause: Management indicated that this was attributed to a misunderstanding of the requirements and the inability to rely on budgeted estimates alone. Recommendation: We recommend that management utilize a time and activity method which meets the requirements of federal regulations. We also recommend employees and their supervisors are provided training on the requirements. Views of Responsible Official and Planned Corrective Actions: The reason for recurrence is the finding was communicated late in the prior year and due to transition and turnover within the department's staff. Management agrees with the stated finding and has implemented a corrective action plan.
Finding 2023-006 Unallowable and Improperly Documented Payroll Expenditures Type of Finding: Noncompliance and Material Weakness in Internal Control over Compliance Condition and Context: The Organization failed to establish critical processes and internal controls over payroll expenditures to ensure compliance with Uniform Guidance requirements and several compliance issues were identified. As part of audit procedures, 44 transactions were selected in a testing sample from a population of 243 direct payroll transactions. Of the transactions tested, the auditors noted 8 instances of payroll costs overclaimed by way of claiming the same work effort for the same period on multiple grants. The auditors noted 18 instances of failure to properly calculate and allocate the work effort completed by employees that worked on multiple grants and programs. The auditors noted 9 instances of the Organization failing to have approved pay rates on file that matched the amounts paid to the employees. The auditors also noted a significant lack of supervisory approval on timesheets or other time allocation support. Criteria: According to Uniform Guidance 2 CFR §200.430, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records should be adequately documented, authorized, and supported by timesheets or other documentation approved by appropriate officials. These records should also reasonably reflect the total activity for which the employee is compensated, not exceeding 100 percent of compensated activities. The records should also 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. Further, proper internal controls should be in place to ensure compliance with federal requirements. Cause: The Organization failed to implement appropriate policies, procedures, and internal controls that would allow management to properly record, track, and claim payroll expenditures compliant with Uniform Guidance requirements. The root cause of these matters appears to be due to a lack of sufficient skills, knowledge, and experience in the grant administrators and leadership roles. Effect: The impact of failing to establish a robust system of processes and internal controls to specifically allocate the work performed for employees among specific grants, there is a significant risk that the Organization would charge work efforts against the wrong grants. Failure to have an appropriate system in place also increases the risk that the Organization would make duplicate claims for the same work effort. Failure to have supervisory approval over work effort could lead to claims of employee work that cannot be substantiated. Failure to have approved pay rates could lead to employees being paid more or less than owed, and federal programs being under or over claimed. Overall, the failure to establish sufficient internal controls in these areas greatly increases the risks that federal funds would be spent outside of the Uniform Guidance requirements. Questioned Costs: Known questioned costs of $32,393 were identified. Repeat Finding: This is not a repeat finding. Recommendation: It is recommended that the Organization implement more robust processes and internal controls over their accounting for payroll. All employees should complete timesheets or have up to date work effort allocations that clearly document their work efforts. These forms should be updated regularly and approved by appropriate supervisors. Employee pay rates should be documented and approved through offer letters and pay rate change forms. The Organization should evaluate the personnel involved with the payroll cycle and ensure that appropriate segregation of duties are in place, or other internal controls are implemented to ensure Organizational funds are properly safeguarded. The Organization should also better utilize its accounting database to ensure payroll costs are properly tracked and categorized against its grant activities to prevent duplicate claims. Views of Responsible Officials: The Organization retained a licensed CPA firm with significant expertise in financial reporting and single audit compliance. The Organization will conduct mandatory training for all supervisors to reinforce the importance of accurate timesheet approval processes, proper time allocation for employees working on multiple grants or programs, and ensuring timely and consistent documentation of payroll expenditures. The Organization will ensure all approved pay rates are documented, signed, and filed for each employee. The Organization will configure QuickBooks to ensure payroll costs and grant allocations are clearly identifiable and traceable and linked to corresponding grants and federal claims.
Finding 2023-006 Unallowable and Improperly Documented Payroll Expenditures Type of Finding: Noncompliance and Material Weakness in Internal Control over Compliance Condition and Context: The Organization failed to establish critical processes and internal controls over payroll expenditures to ensure compliance with Uniform Guidance requirements and several compliance issues were identified. As part of audit procedures, 44 transactions were selected in a testing sample from a population of 243 direct payroll transactions. Of the transactions tested, the auditors noted 8 instances of payroll costs overclaimed by way of claiming the same work effort for the same period on multiple grants. The auditors noted 18 instances of failure to properly calculate and allocate the work effort completed by employees that worked on multiple grants and programs. The auditors noted 9 instances of the Organization failing to have approved pay rates on file that matched the amounts paid to the employees. The auditors also noted a significant lack of supervisory approval on timesheets or other time allocation support. Criteria: According to Uniform Guidance 2 CFR §200.430, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records should be adequately documented, authorized, and supported by timesheets or other documentation approved by appropriate officials. These records should also reasonably reflect the total activity for which the employee is compensated, not exceeding 100 percent of compensated activities. The records should also 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. Further, proper internal controls should be in place to ensure compliance with federal requirements. Cause: The Organization failed to implement appropriate policies, procedures, and internal controls that would allow management to properly record, track, and claim payroll expenditures compliant with Uniform Guidance requirements. The root cause of these matters appears to be due to a lack of sufficient skills, knowledge, and experience in the grant administrators and leadership roles. Effect: The impact of failing to establish a robust system of processes and internal controls to specifically allocate the work performed for employees among specific grants, there is a significant risk that the Organization would charge work efforts against the wrong grants. Failure to have an appropriate system in place also increases the risk that the Organization would make duplicate claims for the same work effort. Failure to have supervisory approval over work effort could lead to claims of employee work that cannot be substantiated. Failure to have approved pay rates could lead to employees being paid more or less than owed, and federal programs being under or over claimed. Overall, the failure to establish sufficient internal controls in these areas greatly increases the risks that federal funds would be spent outside of the Uniform Guidance requirements. Questioned Costs: Known questioned costs of $32,393 were identified. Repeat Finding: This is not a repeat finding. Recommendation: It is recommended that the Organization implement more robust processes and internal controls over their accounting for payroll. All employees should complete timesheets or have up to date work effort allocations that clearly document their work efforts. These forms should be updated regularly and approved by appropriate supervisors. Employee pay rates should be documented and approved through offer letters and pay rate change forms. The Organization should evaluate the personnel involved with the payroll cycle and ensure that appropriate segregation of duties are in place, or other internal controls are implemented to ensure Organizational funds are properly safeguarded. The Organization should also better utilize its accounting database to ensure payroll costs are properly tracked and categorized against its grant activities to prevent duplicate claims. Views of Responsible Officials: The Organization retained a licensed CPA firm with significant expertise in financial reporting and single audit compliance. The Organization will conduct mandatory training for all supervisors to reinforce the importance of accurate timesheet approval processes, proper time allocation for employees working on multiple grants or programs, and ensuring timely and consistent documentation of payroll expenditures. The Organization will ensure all approved pay rates are documented, signed, and filed for each employee. The Organization will configure QuickBooks to ensure payroll costs and grant allocations are clearly identifiable and traceable and linked to corresponding grants and federal claims.
Finding 2023-006 Unallowable and Improperly Documented Payroll Expenditures Type of Finding: Noncompliance and Material Weakness in Internal Control over Compliance Condition and Context: The Organization failed to establish critical processes and internal controls over payroll expenditures to ensure compliance with Uniform Guidance requirements and several compliance issues were identified. As part of audit procedures, 44 transactions were selected in a testing sample from a population of 243 direct payroll transactions. Of the transactions tested, the auditors noted 8 instances of payroll costs overclaimed by way of claiming the same work effort for the same period on multiple grants. The auditors noted 18 instances of failure to properly calculate and allocate the work effort completed by employees that worked on multiple grants and programs. The auditors noted 9 instances of the Organization failing to have approved pay rates on file that matched the amounts paid to the employees. The auditors also noted a significant lack of supervisory approval on timesheets or other time allocation support. Criteria: According to Uniform Guidance 2 CFR §200.430, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records should be adequately documented, authorized, and supported by timesheets or other documentation approved by appropriate officials. These records should also reasonably reflect the total activity for which the employee is compensated, not exceeding 100 percent of compensated activities. The records should also 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. Further, proper internal controls should be in place to ensure compliance with federal requirements. Cause: The Organization failed to implement appropriate policies, procedures, and internal controls that would allow management to properly record, track, and claim payroll expenditures compliant with Uniform Guidance requirements. The root cause of these matters appears to be due to a lack of sufficient skills, knowledge, and experience in the grant administrators and leadership roles. Effect: The impact of failing to establish a robust system of processes and internal controls to specifically allocate the work performed for employees among specific grants, there is a significant risk that the Organization would charge work efforts against the wrong grants. Failure to have an appropriate system in place also increases the risk that the Organization would make duplicate claims for the same work effort. Failure to have supervisory approval over work effort could lead to claims of employee work that cannot be substantiated. Failure to have approved pay rates could lead to employees being paid more or less than owed, and federal programs being under or over claimed. Overall, the failure to establish sufficient internal controls in these areas greatly increases the risks that federal funds would be spent outside of the Uniform Guidance requirements. Questioned Costs: Known questioned costs of $32,393 were identified. Repeat Finding: This is not a repeat finding. Recommendation: It is recommended that the Organization implement more robust processes and internal controls over their accounting for payroll. All employees should complete timesheets or have up to date work effort allocations that clearly document their work efforts. These forms should be updated regularly and approved by appropriate supervisors. Employee pay rates should be documented and approved through offer letters and pay rate change forms. The Organization should evaluate the personnel involved with the payroll cycle and ensure that appropriate segregation of duties are in place, or other internal controls are implemented to ensure Organizational funds are properly safeguarded. The Organization should also better utilize its accounting database to ensure payroll costs are properly tracked and categorized against its grant activities to prevent duplicate claims. Views of Responsible Officials: The Organization retained a licensed CPA firm with significant expertise in financial reporting and single audit compliance. The Organization will conduct mandatory training for all supervisors to reinforce the importance of accurate timesheet approval processes, proper time allocation for employees working on multiple grants or programs, and ensuring timely and consistent documentation of payroll expenditures. The Organization will ensure all approved pay rates are documented, signed, and filed for each employee. The Organization will configure QuickBooks to ensure payroll costs and grant allocations are clearly identifiable and traceable and linked to corresponding grants and federal claims.
Finding 2023-006 Unallowable and Improperly Documented Payroll Expenditures Type of Finding: Noncompliance and Material Weakness in Internal Control over Compliance Condition and Context: The Organization failed to establish critical processes and internal controls over payroll expenditures to ensure compliance with Uniform Guidance requirements and several compliance issues were identified. As part of audit procedures, 44 transactions were selected in a testing sample from a population of 243 direct payroll transactions. Of the transactions tested, the auditors noted 8 instances of payroll costs overclaimed by way of claiming the same work effort for the same period on multiple grants. The auditors noted 18 instances of failure to properly calculate and allocate the work effort completed by employees that worked on multiple grants and programs. The auditors noted 9 instances of the Organization failing to have approved pay rates on file that matched the amounts paid to the employees. The auditors also noted a significant lack of supervisory approval on timesheets or other time allocation support. Criteria: According to Uniform Guidance 2 CFR §200.430, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records should be adequately documented, authorized, and supported by timesheets or other documentation approved by appropriate officials. These records should also reasonably reflect the total activity for which the employee is compensated, not exceeding 100 percent of compensated activities. The records should also 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. Further, proper internal controls should be in place to ensure compliance with federal requirements. Cause: The Organization failed to implement appropriate policies, procedures, and internal controls that would allow management to properly record, track, and claim payroll expenditures compliant with Uniform Guidance requirements. The root cause of these matters appears to be due to a lack of sufficient skills, knowledge, and experience in the grant administrators and leadership roles. Effect: The impact of failing to establish a robust system of processes and internal controls to specifically allocate the work performed for employees among specific grants, there is a significant risk that the Organization would charge work efforts against the wrong grants. Failure to have an appropriate system in place also increases the risk that the Organization would make duplicate claims for the same work effort. Failure to have supervisory approval over work effort could lead to claims of employee work that cannot be substantiated. Failure to have approved pay rates could lead to employees being paid more or less than owed, and federal programs being under or over claimed. Overall, the failure to establish sufficient internal controls in these areas greatly increases the risks that federal funds would be spent outside of the Uniform Guidance requirements. Questioned Costs: Known questioned costs of $32,393 were identified. Repeat Finding: This is not a repeat finding. Recommendation: It is recommended that the Organization implement more robust processes and internal controls over their accounting for payroll. All employees should complete timesheets or have up to date work effort allocations that clearly document their work efforts. These forms should be updated regularly and approved by appropriate supervisors. Employee pay rates should be documented and approved through offer letters and pay rate change forms. The Organization should evaluate the personnel involved with the payroll cycle and ensure that appropriate segregation of duties are in place, or other internal controls are implemented to ensure Organizational funds are properly safeguarded. The Organization should also better utilize its accounting database to ensure payroll costs are properly tracked and categorized against its grant activities to prevent duplicate claims. Views of Responsible Officials: The Organization retained a licensed CPA firm with significant expertise in financial reporting and single audit compliance. The Organization will conduct mandatory training for all supervisors to reinforce the importance of accurate timesheet approval processes, proper time allocation for employees working on multiple grants or programs, and ensuring timely and consistent documentation of payroll expenditures. The Organization will ensure all approved pay rates are documented, signed, and filed for each employee. The Organization will configure QuickBooks to ensure payroll costs and grant allocations are clearly identifiable and traceable and linked to corresponding grants and federal claims.
Finding 2023-006 Unallowable and Improperly Documented Payroll Expenditures Type of Finding: Noncompliance and Material Weakness in Internal Control over Compliance Condition and Context: The Organization failed to establish critical processes and internal controls over payroll expenditures to ensure compliance with Uniform Guidance requirements and several compliance issues were identified. As part of audit procedures, 44 transactions were selected in a testing sample from a population of 243 direct payroll transactions. Of the transactions tested, the auditors noted 8 instances of payroll costs overclaimed by way of claiming the same work effort for the same period on multiple grants. The auditors noted 18 instances of failure to properly calculate and allocate the work effort completed by employees that worked on multiple grants and programs. The auditors noted 9 instances of the Organization failing to have approved pay rates on file that matched the amounts paid to the employees. The auditors also noted a significant lack of supervisory approval on timesheets or other time allocation support. Criteria: According to Uniform Guidance 2 CFR §200.430, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records should be adequately documented, authorized, and supported by timesheets or other documentation approved by appropriate officials. These records should also reasonably reflect the total activity for which the employee is compensated, not exceeding 100 percent of compensated activities. The records should also 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. Further, proper internal controls should be in place to ensure compliance with federal requirements. Cause: The Organization failed to implement appropriate policies, procedures, and internal controls that would allow management to properly record, track, and claim payroll expenditures compliant with Uniform Guidance requirements. The root cause of these matters appears to be due to a lack of sufficient skills, knowledge, and experience in the grant administrators and leadership roles. Effect: The impact of failing to establish a robust system of processes and internal controls to specifically allocate the work performed for employees among specific grants, there is a significant risk that the Organization would charge work efforts against the wrong grants. Failure to have an appropriate system in place also increases the risk that the Organization would make duplicate claims for the same work effort. Failure to have supervisory approval over work effort could lead to claims of employee work that cannot be substantiated. Failure to have approved pay rates could lead to employees being paid more or less than owed, and federal programs being under or over claimed. Overall, the failure to establish sufficient internal controls in these areas greatly increases the risks that federal funds would be spent outside of the Uniform Guidance requirements. Questioned Costs: Known questioned costs of $32,393 were identified. Repeat Finding: This is not a repeat finding. Recommendation: It is recommended that the Organization implement more robust processes and internal controls over their accounting for payroll. All employees should complete timesheets or have up to date work effort allocations that clearly document their work efforts. These forms should be updated regularly and approved by appropriate supervisors. Employee pay rates should be documented and approved through offer letters and pay rate change forms. The Organization should evaluate the personnel involved with the payroll cycle and ensure that appropriate segregation of duties are in place, or other internal controls are implemented to ensure Organizational funds are properly safeguarded. The Organization should also better utilize its accounting database to ensure payroll costs are properly tracked and categorized against its grant activities to prevent duplicate claims. Views of Responsible Officials: The Organization retained a licensed CPA firm with significant expertise in financial reporting and single audit compliance. The Organization will conduct mandatory training for all supervisors to reinforce the importance of accurate timesheet approval processes, proper time allocation for employees working on multiple grants or programs, and ensuring timely and consistent documentation of payroll expenditures. The Organization will ensure all approved pay rates are documented, signed, and filed for each employee. The Organization will configure QuickBooks to ensure payroll costs and grant allocations are clearly identifiable and traceable and linked to corresponding grants and federal claims.
Item: 2023-004 Assistance Listing Number: 93.940 Programs: HIV Prevention Activities Health Department Based Federal Agency: U.S. Department of Health and Human Services Pass-Through Agencies: Arizona Department of Health Services Pass-Through Grantor Identifying Number: CTR069364, CTR067201, CTR045489, ADHS19-207305 Award Year: April 1, 2022 to March 31, 2023; August 1, 2022 to July 31, 2023; January 1, 2023 to December 31, 2023; April 1, 2023 to March 31, 2024; August 1, 2023 to July 31, 2024 Compliance Requirement: Allowable Activities and Costs Criteria: In accordance with 2 CFR § 200.430 – Compensation – charges to federal programs for salaries and wages should be supported by a system of internal controls which provides reasonable assurance the amounts charged are accurate, allowable and properly allocated. Condition: Incorrect allocation of employee hours were charged to the federal program. Questioned Costs: n/a Context: In a population of over 250 payroll costs charged to the program, we conducted a non-statistical sample of 40 payroll costs charged to the program. In our sample of 40, we noted that 1 selection in which the employee was paid at an outdated pay rate and paid overtime that was not supported by the employee timesheet. The variances between the amount charged and the amount supported, as well as the projected impact to the entire population, was trivial in nature. This is deemed to be a significant deficiency in internal control over compliance. Effect: The system of internal controls was not properly implemented. Cause: The entity’s system of internal controls did detect, or document the rationale for, instances in which the amounts charged to a federal program did not agree to the underlying supporting documentation maintained by the Organization. Identification as a Repeat Finding: Repeat finding – prior year 2022-004 Recommendation: The Organization should enhance its processes and controls to ensure that expenses are appropriately reviewed before submission of billing. Views of Responsible Officials: Management of the Organization concurs with the finding. See Corrective Action Plan.
2023-007 Lack of Documentation for Employee Rate of Pay (Material Weakness) Federal Agency: Department of Homeland Security Pass-through Agency: New Hampshire Department of Safety Cluster/Program: COVID-19 – Disaster Grants – Public Assistance (Presidentially Declared Disasters) Assistance Listing Number: 97.036 Passed-through Identification: 23DR4516PA Compliance Requirement: Activities Allowed or Unallowed and Allowable Costs/Cost Principles Type of Finding: Internal Control over Compliance – Material Weakness Material Noncompliance Criteria or Specific Requirement: Federal regulations 2 CFR 200.303 states, the Town, as a recipient of Federal funds, must establish and maintain effective internal controls 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. In addition, under 2 CFR 200.430, it states that charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must (1) be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, (2) be incorporated into the official records of the non-Federal entity, (3) reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities, and (4) 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 or a federal award and non-Federal award. Entities must maintain adequate documentation to support payroll charges, including specific details on employee pay rates used for calculating reimbursements. This documentation is necessary to ensure that payroll costs charged to federal programs are reasonable, accurate, and in compliance with applicable laws and regulations. Condition: During our audit we noted that the Town was reimbursed for overtime hours performed by police and fire personnel who responded to the COVID-19 pandemic during 2020 and 2021. The rate of pay used was reflective of the employee’s overtime rate inclusive of fringe benefits. The Town was unable to provide documentation verifying the employee’s rate of pay used to calculate reimbursement for payroll charges. Specifically, records reflecting the employee’s overtime rate inclusive of fringe benefits, were not available for review. In addition, the Town acknowledged that they attempted to recalculate the rate of pay for each employee selected for testing, but it yielded figures that could not be matched to the original source worksheet submitted to the federal agency. Cause: The Town lacks a standardized process for recording and maintaining documentation for payroll rates, including the breakdown of overtime and fringe benefit components used for federal reimbursement. This is due to inadequate internal controls and oversight in the payroll and accounting processes, as well as limited staff training on federal documentation requirements. Effect: The inability to verify the overtime rate with fringe benefits used in reimbursement calculations creates a risk of non-compliance with federal requirements, which could lead to questioned costs and potential disallowance of the submitted payroll charges as it may not reflect actual, allowable costs. Additionally, the lack of supporting documentation undermines the Town’s ability to substantiate its payroll expenditures and comply with federal grant accounting requirements. Failure to provide adequate documentation could affect future funding eligibility. Consequently, essential payroll records were not retained, resulting in noncompliance with federal grant documentation standards and a disclaimer of opinion on the major program. Questioned Costs: $1,947,729 Identification as Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the Town implement enhanced record-keeping procedures to ensure that all payroll charges, especially complex rates involving overtime and fringe benefits, are documented and verifiable. Specifically, the Town should establish a process to document and track each component of the rate of pay used in reimbursement calculations. This process should involve establishing a systematic approach to linking payroll records with source documents and include clear guidelines for calculating and recording overtime rates inclusive of fringe benefits. Additionally, we advise the Town to establish periodic internal reviews and staff training to ensure payroll charges are fully supported, align with federal requirements, and comply with documentation requirements. Views of Responsible Officials: Management’s views and corrective action plan is included at the end of this report.
Federal Agency: U.S. Department of the Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Award Identification Number and Year: SLFRP0002 – 2021, SLFRP1045 – 2021, SLFRP0194 - 2021 Pass-Through Agency: Washington State Department of Commerce, City of Seattle, Snohomish County Pass-Through Number(s): (DOC) 23-F21400119-017, DC222308, CLFR-042 Award Period: Various Type of Finding: • Significant Deficiency in Internal Control Over Compliance Criteria or specific requirement: 2 CFR 200.430 states: Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. In addition, records 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 or a Federal award and non-Federal award. Further, budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards. Condition: For some paychecks tested, it was noted the percentage of hours worked on the Federal program as indicated on the timesheet did not always tie to the allocation spreadsheet which determined the payroll costs that was ultimately charged to the major program. In addition, for one employee paycheck tested that was partially allocated to the major program, it was found that there was an error in the calculation of a salary increase, which resulted in an incorrect amount being charged to the program. Questioned costs: $2,339 Context: Of the 40 paychecks tested, 10 paychecks showed a potential over allocation of payroll costs to the Federal program. These over allocations varied from paycheck to paycheck and ranged from $5 to $1,648. One of the paychecks tested also included the miscalculation of salary amount. Cause: The person responsible for allocating payroll is no longer employed with Ventures. Therefore, specific cause cannot be identified. It was noted, however, there were two allocation spreadsheet templates being used during this fiscal year causing both a redundancy of information and a lack of synchronized information in some areas. This was likely the main reason for the allocation related issues encountered during the audit. In addition, the miscalculation of the payrate that occurred was not detected by the organization’s internal controls. Effect: Potential outcome is an overallocation to the Federal program leading to requests for reimbursement of funds (in the payroll expense category). Repeat finding: No Recommendation: We recommend the Organization utilize one spreadsheet for allocating payroll costs and implement additional controls to ensure the allocations to Federal grants accurately reflect the actual hours worked. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of the Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Award Identification Number and Year: SLFRP0002 – 2021, SLFRP1045 – 2021, SLFRP0194 - 2021 Pass-Through Agency: Washington State Department of Commerce, City of Seattle, Snohomish County Pass-Through Number(s): (DOC) 23-F21400119-017, DC222308, CLFR-042 Award Period: Various Type of Finding: • Significant Deficiency in Internal Control Over Compliance Criteria or specific requirement: 2 CFR 200.430 states: Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. In addition, records 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 or a Federal award and non-Federal award. Further, budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards. Condition: For some paychecks tested, it was noted the percentage of hours worked on the Federal program as indicated on the timesheet did not always tie to the allocation spreadsheet which determined the payroll costs that was ultimately charged to the major program. In addition, for one employee paycheck tested that was partially allocated to the major program, it was found that there was an error in the calculation of a salary increase, which resulted in an incorrect amount being charged to the program. Questioned costs: $2,339 Context: Of the 40 paychecks tested, 10 paychecks showed a potential over allocation of payroll costs to the Federal program. These over allocations varied from paycheck to paycheck and ranged from $5 to $1,648. One of the paychecks tested also included the miscalculation of salary amount. Cause: The person responsible for allocating payroll is no longer employed with Ventures. Therefore, specific cause cannot be identified. It was noted, however, there were two allocation spreadsheet templates being used during this fiscal year causing both a redundancy of information and a lack of synchronized information in some areas. This was likely the main reason for the allocation related issues encountered during the audit. In addition, the miscalculation of the payrate that occurred was not detected by the organization’s internal controls. Effect: Potential outcome is an overallocation to the Federal program leading to requests for reimbursement of funds (in the payroll expense category). Repeat finding: No Recommendation: We recommend the Organization utilize one spreadsheet for allocating payroll costs and implement additional controls to ensure the allocations to Federal grants accurately reflect the actual hours worked. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of the Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Award Identification Number and Year: SLFRP0002 – 2021, SLFRP1045 – 2021, SLFRP0194 - 2021 Pass-Through Agency: Washington State Department of Commerce, City of Seattle, Snohomish County Pass-Through Number(s): (DOC) 23-F21400119-017, DC222308, CLFR-042 Award Period: Various Type of Finding: • Significant Deficiency in Internal Control Over Compliance Criteria or specific requirement: 2 CFR 200.430 states: Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. In addition, records 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 or a Federal award and non-Federal award. Further, budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards. Condition: For some paychecks tested, it was noted the percentage of hours worked on the Federal program as indicated on the timesheet did not always tie to the allocation spreadsheet which determined the payroll costs that was ultimately charged to the major program. In addition, for one employee paycheck tested that was partially allocated to the major program, it was found that there was an error in the calculation of a salary increase, which resulted in an incorrect amount being charged to the program. Questioned costs: $2,339 Context: Of the 40 paychecks tested, 10 paychecks showed a potential over allocation of payroll costs to the Federal program. These over allocations varied from paycheck to paycheck and ranged from $5 to $1,648. One of the paychecks tested also included the miscalculation of salary amount. Cause: The person responsible for allocating payroll is no longer employed with Ventures. Therefore, specific cause cannot be identified. It was noted, however, there were two allocation spreadsheet templates being used during this fiscal year causing both a redundancy of information and a lack of synchronized information in some areas. This was likely the main reason for the allocation related issues encountered during the audit. In addition, the miscalculation of the payrate that occurred was not detected by the organization’s internal controls. Effect: Potential outcome is an overallocation to the Federal program leading to requests for reimbursement of funds (in the payroll expense category). Repeat finding: No Recommendation: We recommend the Organization utilize one spreadsheet for allocating payroll costs and implement additional controls to ensure the allocations to Federal grants accurately reflect the actual hours worked. Views of responsible officials: There is no disagreement with the audit finding.
In accordance with 2 CFR 200.430, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. Budget estimates alone do not qualify as support for charges to Federal awards. For the year ended December 31, 2023, AEA did not maintain support for salary based on work performed. Salary and wages were charged based on a flat rate for all employees. The salaries and wages are not charged based on actual work performed. AEA is not in compliance with 2 CFR 200.430. There are no questioned costs reported. A random sampling of the federal expenditures. This is not a repeat finding from the prior year. We recommend that AEA establish a system to determine and document the time spent and amount charged to their programs.
In accordance with 2 CFR 200.430, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. Budget estimates alone do not qualify as support for charges to Federal awards. For the year ended December 31, 2023, AEA did not maintain support for salary based on work performed. Salary and wages were charged based on a flat rate for all employees. The salaries and wages are not charged based on actual work performed. AEA is not in compliance with 2 CFR 200.430. There are no questioned costs reported. A random sampling of the federal expenditures. This is not a repeat finding from the prior year. We recommend that AEA establish a system to determine and document the time spent and amount charged to their programs.
In accordance with 2 CFR 200.430, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. Budget estimates alone do not qualify as support for charges to Federal awards. For the year ended December 31, 2023, AEA did not maintain support for salary based on work performed. Salary and wages were charged based on a flat rate for all employees. The salaries and wages are not charged based on actual work performed. AEA is not in compliance with 2 CFR 200.430. There are no questioned costs reported. A random sampling of the federal expenditures. This is not a repeat finding from the prior year. We recommend that AEA establish a system to determine and document the time spent and amount charged to their programs.
In accordance with 2 CFR 200.430, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. Budget estimates alone do not qualify as support for charges to Federal awards. For the year ended December 31, 2023, AEA did not maintain support for salary based on work performed. Salary and wages were charged based on a flat rate for all employees. The salaries and wages are not charged based on actual work performed. AEA is not in compliance with 2 CFR 200.430. There are no questioned costs reported. A random sampling of the federal expenditures. This is not a repeat finding from the prior year. We recommend that AEA establish a system to determine and document the time spent and amount charged to their programs.
In accordance with 2 CFR 200.430, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. Budget estimates alone do not qualify as support for charges to Federal awards. For the year ended December 31, 2023, AEA did not maintain support for salary based on work performed. Salary and wages were charged based on a flat rate for all employees. The salaries and wages are not charged based on actual work performed. AEA is not in compliance with 2 CFR 200.430. There are no questioned costs reported. A random sampling of the federal expenditures. This is not a repeat finding from the prior year. We recommend that AEA establish a system to determine and document the time spent and amount charged to their programs.
In accordance with 2 CFR 200.430, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. Budget estimates alone do not qualify as support for charges to Federal awards. For the year ended December 31, 2023, AEA did not maintain support for salary based on work performed. Salary and wages were charged based on a flat rate for all employees. The salaries and wages are not charged based on actual work performed. AEA is not in compliance with 2 CFR 200.430. There are no questioned costs reported. A random sampling of the federal expenditures. This is not a repeat finding from the prior year. We recommend that AEA establish a system to determine and document the time spent and amount charged to their programs.
Assistance Listing Number(s): 10.912 Name of Federal Program or Cluster: Environmental Quality Incentives Program Name of Federal Agency: Department of Agriculture Award Periods: September 3, 2019 through July 31, 2024 and September 30, 2020 through September 30, 2025 Assistance Listing Number(s): 10.924 Name of Federal Program or Cluster: Conservation Stewardship Program Name of Federal Agency: Department of Agriculture Award Periods: September 3, 2019 through July 31, 2024 and September 30, 2020 through September 30, 2025 Criteria or Specific Requirement: Subparts D and E of 2 CFR Part 200 require a nonfederal entity to establish written policies, procedures, and standards of conduct, including procedures to implement the cash management requirements of 2 CFR section 200.305, procedures that comply with the procurement standards of 2 CFR sections 200.318 through 200.326, and procedures for determining the allowability of costs in accordance with Subpart E of 2 CFR Part 200. Specifically, 2 CFR sections 200.430, 200.431, and 200.475 require written policies. Condition: There are no written policies and procedures for allowable costs/cost principles, cash management, procurement and suspension and debarment requirements. Cause: The Organization does not have a process for reviewing their accounting policies and procedures manual on a regular basis to ensure written procedures conform to Uniform Guidance requirements. Effect or Potential Effect: A lack of written policies, procedures, and standards of conduct may result in noncompliance with the requirements of federal programs and/or disallowed costs. Repeat Finding: No Recommendation: We recommend the Organization’s written policies and procedures be reviewed and updated for compliance with Uniform Guidance. The organization should become familiar with the requirements of Subparts D and E of 2 CFR Part 200 and establish appropriate written policies, procedures, and standards of conduct. Views of Responsible Officials: Management agrees with the finding and they will evaluate our findings to determine an appropriate corrective action.
Assistance Listing Number(s): 10.912 Name of Federal Program or Cluster: Environmental Quality Incentives Program Name of Federal Agency: Department of Agriculture Award Periods: September 3, 2019 through July 31, 2024 and September 30, 2020 through September 30, 2025 Assistance Listing Number(s): 10.924 Name of Federal Program or Cluster: Conservation Stewardship Program Name of Federal Agency: Department of Agriculture Award Periods: September 3, 2019 through July 31, 2024 and September 30, 2020 through September 30, 2025 Criteria or Specific Requirement: Subparts D and E of 2 CFR Part 200 require a nonfederal entity to establish written policies, procedures, and standards of conduct, including procedures to implement the cash management requirements of 2 CFR section 200.305, procedures that comply with the procurement standards of 2 CFR sections 200.318 through 200.326, and procedures for determining the allowability of costs in accordance with Subpart E of 2 CFR Part 200. Specifically, 2 CFR sections 200.430, 200.431, and 200.475 require written policies. Condition: There are no written policies and procedures for allowable costs/cost principles, cash management, procurement and suspension and debarment requirements. Cause: The Organization does not have a process for reviewing their accounting policies and procedures manual on a regular basis to ensure written procedures conform to Uniform Guidance requirements. Effect or Potential Effect: A lack of written policies, procedures, and standards of conduct may result in noncompliance with the requirements of federal programs and/or disallowed costs. Repeat Finding: No Recommendation: We recommend the Organization’s written policies and procedures be reviewed and updated for compliance with Uniform Guidance. The organization should become familiar with the requirements of Subparts D and E of 2 CFR Part 200 and establish appropriate written policies, procedures, and standards of conduct. Views of Responsible Officials: Management agrees with the finding and they will evaluate our findings to determine an appropriate corrective action.
(2023-002) Allowable Costs Federal Agency: U.S. Department of Treasury CFDA No.: 21.027 Federal Program: Coronavirus State and Local Fiscal Recovery Funds Federal Award Year: 2023 Control Category: Allowable Costs Questioned Costs: $371,621 Condition The Center billed $852,359 to the State Bar of California for the above mentioned grant during the year ended December 31, 2023. Of the total costs charged, $694,940 was for payroll and benefit costs. The Center provided a detail of quarterly expenses by employee that totaled $603,238, leaving $91,702 of questioned costs. From the $603,238 of employee costs, we selected a sample of 20 individual payroll expenses covering both grants and two quarters. We then obtained the employee’s personnel action form and timesheet to determine if the time billed to the grant was supported by the timesheet. In situations where the employee completed a timesheet, we identified differences between what was allocated to the grant and what was reported on the timesheet. For other employees, we noted that no timesheet was retained to support the allocation. Criteria 2 CFR 200.430(i), Standards for Documentation of Personnel Expenses, states, in part: “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed…” Charges 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;…” And “budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards.” Cause The Center's calculation of payroll allocated to the grant is not reconciled to the actual hours reported by the employee on their individual timesheet, and in many cases no timesheet is maintained by the employee. Effect Payroll costs allocated to the program are not supported by the Center’s accounting records. Questioned Costs We identified $52,780 of unsupported allocations to the grant from the sample selected, which extrapolates to a possible error of $279,919. Additionally, as previously reported, $91,702 of costs allocated to the grant were not supported by the accounting records. The total questioned costs are $371,621. Per discussion with Center staff, the State Bar of California does not require the payroll allocation to be supported by evidence of actual time spent on the grant. Recommendation We recommend that the Center allocate time to the grants based on actual hours worked per the employees' timesheets to comply with the federal guidelines. Management Response Beginning in March of 2024, when the Center received the 2022 Single Audit findings, the Center has been charging personnel costs to the federal program based on actual time recorded in the organization’s case management software. On a quarterly basis, the Unit Heads, CFO, CEO/ED, and Chief Legal Program Officer review the hours to ensure accuracy and completeness. Management notes that this finding involved the period of time before the Center had submitted its Corrective Action Plan (which was on March 28, 2024).
Agencies: Corporation for National Community Service and U.S. Department of Health and Human Services Federal Program: All federal awards. Criteria: It is PHIMC's policy to have timecards prepared and signed by the employee and their applicable supervisor. In addition, 2 CFR 200.430 (i) Compensation-Personnel Services, Standards for Documentation of Personnel Services requires payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated. Condition: We identified an instance in which a timesheet was not signed off by applicable supervisor and there was no evidence of review. In addition, we noted an instance in which the timesheet did not include all time worked. Context: Out of a sample of 40 timesheets, two timesheets were not complete. Sample was not statistically valid. Cause: The lack of supervisory authorizations and incomplete timesheets appear to be a result of human error and an oversight. Questions Costs: No questioned costs were identified. Effect: Amounts charged to federal awards related to these incomplete timesheets were accurate. However, lack of supervisory review and inaccurate timesheet data can lead to errors in payroll and government grant record keeping. Recommendation: We recommend PHIMC reiterate applicable policy, and ensure all timesheets are prepared, reviewed, and contain appropriate approvals. Views of Responsible Officials: Management plans to reiterate the time and effort reporting policy and ensure timesheets are completed in accordance with PHIMC policy
Agencies: Corporation for National Community Service and U.S. Department of Health and Human Services Federal Program: All federal awards. Criteria: It is PHIMC's policy to have timecards prepared and signed by the employee and their applicable supervisor. In addition, 2 CFR 200.430 (i) Compensation-Personnel Services, Standards for Documentation of Personnel Services requires payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated. Condition: We identified an instance in which a timesheet was not signed off by applicable supervisor and there was no evidence of review. In addition, we noted an instance in which the timesheet did not include all time worked. Context: Out of a sample of 40 timesheets, two timesheets were not complete. Sample was not statistically valid. Cause: The lack of supervisory authorizations and incomplete timesheets appear to be a result of human error and an oversight. Questions Costs: No questioned costs were identified. Effect: Amounts charged to federal awards related to these incomplete timesheets were accurate. However, lack of supervisory review and inaccurate timesheet data can lead to errors in payroll and government grant record keeping. Recommendation: We recommend PHIMC reiterate applicable policy, and ensure all timesheets are prepared, reviewed, and contain appropriate approvals. Views of Responsible Officials: Management plans to reiterate the time and effort reporting policy and ensure timesheets are completed in accordance with PHIMC policy
Agencies: Corporation for National Community Service and U.S. Department of Health and Human Services Federal Program: All federal awards. Criteria: It is PHIMC's policy to have timecards prepared and signed by the employee and their applicable supervisor. In addition, 2 CFR 200.430 (i) Compensation-Personnel Services, Standards for Documentation of Personnel Services requires payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated. Condition: We identified an instance in which a timesheet was not signed off by applicable supervisor and there was no evidence of review. In addition, we noted an instance in which the timesheet did not include all time worked. Context: Out of a sample of 40 timesheets, two timesheets were not complete. Sample was not statistically valid. Cause: The lack of supervisory authorizations and incomplete timesheets appear to be a result of human error and an oversight. Questions Costs: No questioned costs were identified. Effect: Amounts charged to federal awards related to these incomplete timesheets were accurate. However, lack of supervisory review and inaccurate timesheet data can lead to errors in payroll and government grant record keeping. Recommendation: We recommend PHIMC reiterate applicable policy, and ensure all timesheets are prepared, reviewed, and contain appropriate approvals. Views of Responsible Officials: Management plans to reiterate the time and effort reporting policy and ensure timesheets are completed in accordance with PHIMC policy
Agencies: Corporation for National Community Service and U.S. Department of Health and Human Services Federal Program: All federal awards. Criteria: It is PHIMC's policy to have timecards prepared and signed by the employee and their applicable supervisor. In addition, 2 CFR 200.430 (i) Compensation-Personnel Services, Standards for Documentation of Personnel Services requires payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated. Condition: We identified an instance in which a timesheet was not signed off by applicable supervisor and there was no evidence of review. In addition, we noted an instance in which the timesheet did not include all time worked. Context: Out of a sample of 40 timesheets, two timesheets were not complete. Sample was not statistically valid. Cause: The lack of supervisory authorizations and incomplete timesheets appear to be a result of human error and an oversight. Questions Costs: No questioned costs were identified. Effect: Amounts charged to federal awards related to these incomplete timesheets were accurate. However, lack of supervisory review and inaccurate timesheet data can lead to errors in payroll and government grant record keeping. Recommendation: We recommend PHIMC reiterate applicable policy, and ensure all timesheets are prepared, reviewed, and contain appropriate approvals. Views of Responsible Officials: Management plans to reiterate the time and effort reporting policy and ensure timesheets are completed in accordance with PHIMC policy
Agencies: Corporation for National Community Service and U.S. Department of Health and Human Services Federal Program: All federal awards. Criteria: It is PHIMC's policy to have timecards prepared and signed by the employee and their applicable supervisor. In addition, 2 CFR 200.430 (i) Compensation-Personnel Services, Standards for Documentation of Personnel Services requires payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated. Condition: We identified an instance in which a timesheet was not signed off by applicable supervisor and there was no evidence of review. In addition, we noted an instance in which the timesheet did not include all time worked. Context: Out of a sample of 40 timesheets, two timesheets were not complete. Sample was not statistically valid. Cause: The lack of supervisory authorizations and incomplete timesheets appear to be a result of human error and an oversight. Questions Costs: No questioned costs were identified. Effect: Amounts charged to federal awards related to these incomplete timesheets were accurate. However, lack of supervisory review and inaccurate timesheet data can lead to errors in payroll and government grant record keeping. Recommendation: We recommend PHIMC reiterate applicable policy, and ensure all timesheets are prepared, reviewed, and contain appropriate approvals. Views of Responsible Officials: Management plans to reiterate the time and effort reporting policy and ensure timesheets are completed in accordance with PHIMC policy
Agencies: Corporation for National Community Service and U.S. Department of Health and Human Services Federal Program: All federal awards. Criteria: It is PHIMC's policy to have timecards prepared and signed by the employee and their applicable supervisor. In addition, 2 CFR 200.430 (i) Compensation-Personnel Services, Standards for Documentation of Personnel Services requires payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated. Condition: We identified an instance in which a timesheet was not signed off by applicable supervisor and there was no evidence of review. In addition, we noted an instance in which the timesheet did not include all time worked. Context: Out of a sample of 40 timesheets, two timesheets were not complete. Sample was not statistically valid. Cause: The lack of supervisory authorizations and incomplete timesheets appear to be a result of human error and an oversight. Questions Costs: No questioned costs were identified. Effect: Amounts charged to federal awards related to these incomplete timesheets were accurate. However, lack of supervisory review and inaccurate timesheet data can lead to errors in payroll and government grant record keeping. Recommendation: We recommend PHIMC reiterate applicable policy, and ensure all timesheets are prepared, reviewed, and contain appropriate approvals. Views of Responsible Officials: Management plans to reiterate the time and effort reporting policy and ensure timesheets are completed in accordance with PHIMC policy
Agencies: Corporation for National Community Service and U.S. Department of Health and Human Services Federal Program: All federal awards. Criteria: It is PHIMC's policy to have timecards prepared and signed by the employee and their applicable supervisor. In addition, 2 CFR 200.430 (i) Compensation-Personnel Services, Standards for Documentation of Personnel Services requires payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated. Condition: We identified an instance in which a timesheet was not signed off by applicable supervisor and there was no evidence of review. In addition, we noted an instance in which the timesheet did not include all time worked. Context: Out of a sample of 40 timesheets, two timesheets were not complete. Sample was not statistically valid. Cause: The lack of supervisory authorizations and incomplete timesheets appear to be a result of human error and an oversight. Questions Costs: No questioned costs were identified. Effect: Amounts charged to federal awards related to these incomplete timesheets were accurate. However, lack of supervisory review and inaccurate timesheet data can lead to errors in payroll and government grant record keeping. Recommendation: We recommend PHIMC reiterate applicable policy, and ensure all timesheets are prepared, reviewed, and contain appropriate approvals. Views of Responsible Officials: Management plans to reiterate the time and effort reporting policy and ensure timesheets are completed in accordance with PHIMC policy
Agencies: Corporation for National Community Service and U.S. Department of Health and Human Services Federal Program: All federal awards. Criteria: It is PHIMC's policy to have timecards prepared and signed by the employee and their applicable supervisor. In addition, 2 CFR 200.430 (i) Compensation-Personnel Services, Standards for Documentation of Personnel Services requires payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated. Condition: We identified an instance in which a timesheet was not signed off by applicable supervisor and there was no evidence of review. In addition, we noted an instance in which the timesheet did not include all time worked. Context: Out of a sample of 40 timesheets, two timesheets were not complete. Sample was not statistically valid. Cause: The lack of supervisory authorizations and incomplete timesheets appear to be a result of human error and an oversight. Questions Costs: No questioned costs were identified. Effect: Amounts charged to federal awards related to these incomplete timesheets were accurate. However, lack of supervisory review and inaccurate timesheet data can lead to errors in payroll and government grant record keeping. Recommendation: We recommend PHIMC reiterate applicable policy, and ensure all timesheets are prepared, reviewed, and contain appropriate approvals. Views of Responsible Officials: Management plans to reiterate the time and effort reporting policy and ensure timesheets are completed in accordance with PHIMC policy
Agencies: Corporation for National Community Service and U.S. Department of Health and Human Services Federal Program: All federal awards. Criteria: It is PHIMC's policy to have timecards prepared and signed by the employee and their applicable supervisor. In addition, 2 CFR 200.430 (i) Compensation-Personnel Services, Standards for Documentation of Personnel Services requires payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated. Condition: We identified an instance in which a timesheet was not signed off by applicable supervisor and there was no evidence of review. In addition, we noted an instance in which the timesheet did not include all time worked. Context: Out of a sample of 40 timesheets, two timesheets were not complete. Sample was not statistically valid. Cause: The lack of supervisory authorizations and incomplete timesheets appear to be a result of human error and an oversight. Questions Costs: No questioned costs were identified. Effect: Amounts charged to federal awards related to these incomplete timesheets were accurate. However, lack of supervisory review and inaccurate timesheet data can lead to errors in payroll and government grant record keeping. Recommendation: We recommend PHIMC reiterate applicable policy, and ensure all timesheets are prepared, reviewed, and contain appropriate approvals. Views of Responsible Officials: Management plans to reiterate the time and effort reporting policy and ensure timesheets are completed in accordance with PHIMC policy
Agencies: Corporation for National Community Service and U.S. Department of Health and Human Services Federal Program: All federal awards. Criteria: It is PHIMC's policy to have timecards prepared and signed by the employee and their applicable supervisor. In addition, 2 CFR 200.430 (i) Compensation-Personnel Services, Standards for Documentation of Personnel Services requires payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated. Condition: We identified an instance in which a timesheet was not signed off by applicable supervisor and there was no evidence of review. In addition, we noted an instance in which the timesheet did not include all time worked. Context: Out of a sample of 40 timesheets, two timesheets were not complete. Sample was not statistically valid. Cause: The lack of supervisory authorizations and incomplete timesheets appear to be a result of human error and an oversight. Questions Costs: No questioned costs were identified. Effect: Amounts charged to federal awards related to these incomplete timesheets were accurate. However, lack of supervisory review and inaccurate timesheet data can lead to errors in payroll and government grant record keeping. Recommendation: We recommend PHIMC reiterate applicable policy, and ensure all timesheets are prepared, reviewed, and contain appropriate approvals. Views of Responsible Officials: Management plans to reiterate the time and effort reporting policy and ensure timesheets are completed in accordance with PHIMC policy
2023-004 – Allowable Costs Relating to Time and Effort and Internal Controls Information on Federal Program(s) U.S. Department of State Name of Program: Program to End Modern Slavery Assistance Listing Number: 19.019 Grant Award Number: S-SJTIP-18-CA-1014/ S-SJTIP-18-CA-3035/S-SJTIP-20-CA-0026 Grant Award Period: October 1, 2018 through December 31, 2022; October 1, 2021 through September 30, 2024; July 1, 2022 through October 31, 2023 Criteria or Specific Requirement: In accordance with 2 CFR Section 200.430.8(i), charges to federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. Condition: For four salary transactions tested, the Fund could not provide supporting salary allocation schedules for charges made to the Federal awards. Cause: While the Fund has procedures and controls in place over payroll processing, the Fund was unable to provide the payroll cost allocation spreadsheet for two months during 2023. Effect or Potential Effect: Charges to Federal awards for salaries and wages may not reflect accurate time worked. Questioned Costs: None Context: We selected 10 salary transactions charged to the federal programs to test controls over allowable costs. For four out of 10 transactions tested, the cost allocation spreadsheet was not available for review. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Fund consistently enforce its internal controls over payroll processing and ensure that salary allocation schedules are completed and saved. View of Responsible Officials: Management agrees with the Federal award finding identified in the audit. The Fund’s response to this finding is described in the accompanying management’s corrective action plan.
2023-004 – Allowable Costs Relating to Time and Effort and Internal Controls Information on Federal Program(s) U.S. Department of State Name of Program: Program to End Modern Slavery Assistance Listing Number: 19.019 Grant Award Number: S-SJTIP-18-CA-1014/ S-SJTIP-18-CA-3035/S-SJTIP-20-CA-0026 Grant Award Period: October 1, 2018 through December 31, 2022; October 1, 2021 through September 30, 2024; July 1, 2022 through October 31, 2023 Criteria or Specific Requirement: In accordance with 2 CFR Section 200.430.8(i), charges to federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. Condition: For four salary transactions tested, the Fund could not provide supporting salary allocation schedules for charges made to the Federal awards. Cause: While the Fund has procedures and controls in place over payroll processing, the Fund was unable to provide the payroll cost allocation spreadsheet for two months during 2023. Effect or Potential Effect: Charges to Federal awards for salaries and wages may not reflect accurate time worked. Questioned Costs: None Context: We selected 10 salary transactions charged to the federal programs to test controls over allowable costs. For four out of 10 transactions tested, the cost allocation spreadsheet was not available for review. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Fund consistently enforce its internal controls over payroll processing and ensure that salary allocation schedules are completed and saved. View of Responsible Officials: Management agrees with the Federal award finding identified in the audit. The Fund’s response to this finding is described in the accompanying management’s corrective action plan.
2023-004 – Allowable Costs Relating to Time and Effort and Internal Controls Information on Federal Program(s) U.S. Department of State Name of Program: Program to End Modern Slavery Assistance Listing Number: 19.019 Grant Award Number: S-SJTIP-18-CA-1014/ S-SJTIP-18-CA-3035/S-SJTIP-20-CA-0026 Grant Award Period: October 1, 2018 through December 31, 2022; October 1, 2021 through September 30, 2024; July 1, 2022 through October 31, 2023 Criteria or Specific Requirement: In accordance with 2 CFR Section 200.430.8(i), charges to federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. Condition: For four salary transactions tested, the Fund could not provide supporting salary allocation schedules for charges made to the Federal awards. Cause: While the Fund has procedures and controls in place over payroll processing, the Fund was unable to provide the payroll cost allocation spreadsheet for two months during 2023. Effect or Potential Effect: Charges to Federal awards for salaries and wages may not reflect accurate time worked. Questioned Costs: None Context: We selected 10 salary transactions charged to the federal programs to test controls over allowable costs. For four out of 10 transactions tested, the cost allocation spreadsheet was not available for review. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Fund consistently enforce its internal controls over payroll processing and ensure that salary allocation schedules are completed and saved. View of Responsible Officials: Management agrees with the Federal award finding identified in the audit. The Fund’s response to this finding is described in the accompanying management’s corrective action plan.
Condition: The Organization does not maintain time and effort reports to support time allocations for salaried employees who are charged to the federal grant. Criteria: In accordance with 2 CFR section 200.430(g) charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. Cause: The Organization does not maintain time and effort reports to support allocations of salaried employees charged to the grant. Effect: With no time and effort reporting, the allocations for salaried employees for a particular pay period are not supported. Context: Of 25 payroll transactions tested from a population of approximately 300 transactions, we noted that payroll and related costs of $8,999 for four administrative employees were allocated to the grant, but those costs were not supported by time records or time studies. Upon further analysis of payroll costs, a total of $177,140 was determined to have been allocated to the grant for administrative employees but not supported by time records or time studies. Questioned Costs: Potential questioned costs of approximately $177,140. Recommendation: We recommend that management review controls over employee time reporting and determine an appropriate form to document time and effort for each pay period. This should include appropriate documentation of the employees time allocation between program and administrative duties based on work performed. These time and effort reports should be reviewed and approved by the employee’s direct supervisor or the Executive Director. Views of Responsible Officials and Planned Corrective Action: Management stated they will purchase a professional time tracking software program to help all employees track their work hours and activities.
Information on the Federal Program: Assistance Listing Number: 93.686—Ending the HIV Epidemic: A Plan for America—Ryan White HIV/AIDS Program Parts A and B. Pass‐Through Entity: State of Mississippi. Award Number: SG‐2199 R2. Compliance Requirements: Activities Allowed or Unallowed Type of Finding: Material Noncompliance and Material Weakness in Internal Control over Compliance. Criteria: As stated in 2 CFR 200.430, part g, subsection 1, line vii, “budget estimates (meaning, estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards.” 2 CFR 200.430 specifies that charges must be based on records that accurately reflect the work performed. 2 CFR 200.430, part g, subsection 1, line iii further specifies that “these records must reasonably reflect the total activity for which the employee is compensated by the recipient or subrecipient, not exceeding 100 percent of compensated activities.” Condition: SEE charged personnel service cost to the contract based on budgeted estimates and did not track actual hours spent on the federally funded contract for the year ended December 31, 2023. Cause: Exempt employees need to track hours similar to non-exempt employees for federal grants. Effect or Potential Effect: As a result of the identified control deficiencies, there is a risk that personnel service costs charged to federal awards may not accurately reflect the actual work performed. This could lead to unallowable or unsupported costs being billed to federal contracts, potentially resulting in questioned costs or noncompliance with federal regulations. Questioned costs: $72,765 Recommendation: We recommend that SEE establish and implement standardized timekeeping procedures requiring all employees whose salaries are charged to federal contracts to submit accurate and complete timecards that reflect the actual hours worked. Views of responsible officials and planned corrective actions: Management acknowledges the oversight in not utilizing timecards for salaried employees whose compensation is charged to federal contracts. To strengthen internal controls and ensure compliance with applicable federal regulations, management is committed to implementing corrective measures. As part of this effort, management will update existing policies and procedures, and will identify and provide targeted training for accounting personnel responsible for allocating salary charges to federal contracts.