2023 – 003: Cost Allocation of Salaries and Wages to LSC Grants Federal Agency: Legal Services Corporation (LSC) Federal Program Name: LSC Grants Assistance Listing Number: 09.706060 Federal Award Identification Number and Year: 09-706060 - 2023 Award Period: January 1, 2023 – December 31, 2023 Type of Finding: Material Weakness in Internal Control over Compliance Other Matters Criteria or specific requirement: Federal regulations (45 CFR 1635.4(a) and 2 CFR 200.430), state that federal award recipients must base allocations of salaries and wages costs to grants on records that accurately reflect the work performed. Condition: During our testing we noted: Two instances of employees’ pay period salaries totaling $1,742 being allocated to a grant using a flat percentage of 10%, and One instance of an employee’s pay period salary of $147 being allocated to two grants using a combination of their time an effort on those grants while the remaining portion of the employee’s salary was allocated to LSC and two other private grants using a base of total grant hours for the period divided by total hours coded to the Organization’s general fund. As such, the salary costs mentioned above were allocated in an inconsistent manner to other grant payroll costs and were not fully representative of the employees’ time and effort. Questioned costs: $1,742 of allocated salary expense described above, which is related to Assistance Listing Number 09.706060. Context: These three instances were noting during testing of 26 payroll and payroll-related disbursements. Cause: The Organization’s salaries and wages cost allocation methodology is primarily based on time and effort records, but it often includes manual adjustments based on review of individual time records and expense data. Therefore, the methodology is challenging to apply consistently, document contemporaneously, and apply in accordance with federal regulations. Effect: The inclusion of frequent manual adjustments in the Organization’s salaries and wages cost allocation methodology could cause costs to be allocated to grants that are not reflective of the time and effort spent on grant activities. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the Organization consider updating its salaries and wages cost allocation methodology and process to reduce the frequency of manual adjustments based on review of individual time records and expense data and maximize the use of automated allocations based on employees’ time and effort records. Views of responsible officials: There is no disagreement with the audit finding
Finding 2023-002 Salaries and Wages (Allowable Costs) Criteria or Specific Requirement: According to 2 CFR Section 200.430(i), charges to Federal grants for salaries and wages must be based on records that accurately reflect the work performed and the records must: i. Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; ii. Be incorporated into the official records of the non-Federal entity; iii. Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; iv. Encompass Federally-assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; v. Comply with the established accounting policies and practices of the non-Federal entity; vi. [Reserved] vii. Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. viii. Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards.” Condition: NRGI has a timekeeping system in place that provides for employees to record hours worked to specific cost objectives, including to U.S. Government grants. However, we noted that in several cases, the allocation amounts as per the timekeeping system were different from the amounts ultimately recorded within NRGI's general ledger. While the differences were not significant, these discrepancies indicate a deficiency in the internal controls around recording of salary expenditures to projects. Cause: The primary cause appears to be human error, and the result of manual recordkeeping. Effect or Potential Effect: Salary expenditures that are not charged in accordance with the standards referenced above may be questioned or disallowed by the donor. Questioned Costs: Undetermined. Context: This is a condition identified per review of NRGI's compliance with the specified requirements using a statistically valid sample. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend that management revisit its procedures for transferring data from the timekeeping system to the general ledger and implement proper internal controls to ensure that the amounts of salary expenditures charged to grants in the general ledger reconcile to the amounts calculated by the timekeeping system.
U.S. Department of Justice 16.726 Juvenile Mentoring Program Grant Period: 10/1/2020-9/30/2024 Contract Number: 2020-JU-FX-0009 Criteria: Under 2 CFR Section 200.303(a) a non-Federal entity is required to establish and maintain internal controls over compliance with Federal statutes, regulations, and the terms and conditions of the Federal grant. In addition, under 2 CFR Section 200.430 Compensation – personal services, charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. Budget estimates may be used for interim accounting purposes but budget estimates alone do not qualify as support for charges to Federal awards. The entity’s system of internal controls must include a process to review after-the-fact interim charges made to a Federal award to budget estimates and make any necessary adjustments such that the final amount charged to the Federal award is accurate, allowable and properly allocated. Condition: The Academy’s internal control processes do not include a comparison of actual time charged on the employee’s time slip to the budget allocation charged the grant to determine if the budget estimates reflect reasonable approximations of the activities actually performed. Effect: Without internal controls operating effectively, it is possible that the Academy could be at risk to be out of compliance with the applicable compliance requirements. Cause: Additional federal and other restricted grants resulted in employee’s time being allocated across additional funding sources. In addition, the Academy was working with the grantor on a budget adjustment. Questioned Costs: Known questioned costs: $5,573; likely questioned costs $29,683. Perspective: There is no observable evidence of the Academy’s review and reconciliation of time slips to budget estimates which affects both the allowable activities and allowable costs requirements. Repeat Finding: No Auditor’s Recommendation: We recommend the Academy establish policies and procedures to reconcile the percentage of hours charged on time slips to the budget estimates used to bill the Federal grantor. This should be done in conjunction with quarterly billings (or other determined regular interval), at fiscal year end, and at the end of the grant year (if different from the Academy’s fiscal year). Views of Responsible Officials: See Corrective Action Plan
Finding 2023-003: Salaries and Wages (Allowable Costs) Federal Programs: All programs Criteria: According to 2 CFR Section 200.430(i), charges to Federal grants for salaries and wages must be based on records that accurately reflect the work performed and the records must: i. Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; ii. Be incorporated into the official records of the non-Federal entity; iii. Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; iv. Encompass Federally-assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; v. Comply with the established accounting policies and practices of the non-Federal entity; vi. [Reserved] vii. Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. viii. Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards.” Condition: The Center has a timekeeping system in place that provides for employees to record hours worked to specific cost objectives, including to US Government grants. However, we noted one instance the allocation amount as per the timekeeping system with the applicable compensation amount paid to the employee was different from the amounts ultimately recorded within the Center's general ledger. While the difference was not significant, this discrepancy indicate a deficiency in the internal controls around recording of salary expenditures to projects. We also noted the Center changed the payroll allocation methodology during the year under audit but this change was not documented in the policies and procedures. We also did not obtain evidence for review and approval of several payroll registers. Cause: During 2023, the Center's finance department turned over significantly, resulting in oversight of some the salary and wages procedures. Effect or Potential Effect: Salary expenditures that are not charged in accordance with the standards referenced above may be questioned or disallowed by the donor. Questioned Costs: Undetermined Context: This is a condition identified per review of the Center's compliance with the specified requirements using a statistically valid sample. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend that management revisit its procedures for transferring data from the timekeeping system to the general ledger and implement proper internal controls to ensure that the amounts of salary expenditures charged to projects in the general ledger reconcile to the amounts calculated by the timekeeping system and current wages and salaries.We also recommend the payroll registers be reviewed and approved by management immediately upon receipt; any discrepancies or issues must be addressed with the accounting department within a timely period following the close of the payroll period. We also recommend that any change in the payroll allocation methodology be formalized in writing and incorporated into the accounting policies and procedures manual.
Finding 2023-003: Salaries and Wages (Allowable Costs) Federal Programs: All programs Criteria: According to 2 CFR Section 200.430(i), charges to Federal grants for salaries and wages must be based on records that accurately reflect the work performed and the records must: i. Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; ii. Be incorporated into the official records of the non-Federal entity; iii. Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; iv. Encompass Federally-assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; v. Comply with the established accounting policies and practices of the non-Federal entity; vi. [Reserved] vii. Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. viii. Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards.” Condition: The Center has a timekeeping system in place that provides for employees to record hours worked to specific cost objectives, including to US Government grants. However, we noted one instance the allocation amount as per the timekeeping system with the applicable compensation amount paid to the employee was different from the amounts ultimately recorded within the Center's general ledger. While the difference was not significant, this discrepancy indicate a deficiency in the internal controls around recording of salary expenditures to projects. We also noted the Center changed the payroll allocation methodology during the year under audit but this change was not documented in the policies and procedures. We also did not obtain evidence for review and approval of several payroll registers. Cause: During 2023, the Center's finance department turned over significantly, resulting in oversight of some the salary and wages procedures. Effect or Potential Effect: Salary expenditures that are not charged in accordance with the standards referenced above may be questioned or disallowed by the donor. Questioned Costs: Undetermined Context: This is a condition identified per review of the Center's compliance with the specified requirements using a statistically valid sample. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend that management revisit its procedures for transferring data from the timekeeping system to the general ledger and implement proper internal controls to ensure that the amounts of salary expenditures charged to projects in the general ledger reconcile to the amounts calculated by the timekeeping system and current wages and salaries.We also recommend the payroll registers be reviewed and approved by management immediately upon receipt; any discrepancies or issues must be addressed with the accounting department within a timely period following the close of the payroll period. We also recommend that any change in the payroll allocation methodology be formalized in writing and incorporated into the accounting policies and procedures manual.
Finding 2023-003: Salaries and Wages (Allowable Costs) Federal Programs: All programs Criteria: According to 2 CFR Section 200.430(i), charges to Federal grants for salaries and wages must be based on records that accurately reflect the work performed and the records must: i. Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; ii. Be incorporated into the official records of the non-Federal entity; iii. Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; iv. Encompass Federally-assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; v. Comply with the established accounting policies and practices of the non-Federal entity; vi. [Reserved] vii. Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. viii. Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards.” Condition: The Center has a timekeeping system in place that provides for employees to record hours worked to specific cost objectives, including to US Government grants. However, we noted one instance the allocation amount as per the timekeeping system with the applicable compensation amount paid to the employee was different from the amounts ultimately recorded within the Center's general ledger. While the difference was not significant, this discrepancy indicate a deficiency in the internal controls around recording of salary expenditures to projects. We also noted the Center changed the payroll allocation methodology during the year under audit but this change was not documented in the policies and procedures. We also did not obtain evidence for review and approval of several payroll registers. Cause: During 2023, the Center's finance department turned over significantly, resulting in oversight of some the salary and wages procedures. Effect or Potential Effect: Salary expenditures that are not charged in accordance with the standards referenced above may be questioned or disallowed by the donor. Questioned Costs: Undetermined Context: This is a condition identified per review of the Center's compliance with the specified requirements using a statistically valid sample. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend that management revisit its procedures for transferring data from the timekeeping system to the general ledger and implement proper internal controls to ensure that the amounts of salary expenditures charged to projects in the general ledger reconcile to the amounts calculated by the timekeeping system and current wages and salaries.We also recommend the payroll registers be reviewed and approved by management immediately upon receipt; any discrepancies or issues must be addressed with the accounting department within a timely period following the close of the payroll period. We also recommend that any change in the payroll allocation methodology be formalized in writing and incorporated into the accounting policies and procedures manual.
Finding 2023-003: Salaries and Wages (Allowable Costs) Federal Programs: All programs Criteria: According to 2 CFR Section 200.430(i), charges to Federal grants for salaries and wages must be based on records that accurately reflect the work performed and the records must: i. Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; ii. Be incorporated into the official records of the non-Federal entity; iii. Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; iv. Encompass Federally-assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; v. Comply with the established accounting policies and practices of the non-Federal entity; vi. [Reserved] vii. Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. viii. Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards.” Condition: The Center has a timekeeping system in place that provides for employees to record hours worked to specific cost objectives, including to US Government grants. However, we noted one instance the allocation amount as per the timekeeping system with the applicable compensation amount paid to the employee was different from the amounts ultimately recorded within the Center's general ledger. While the difference was not significant, this discrepancy indicate a deficiency in the internal controls around recording of salary expenditures to projects. We also noted the Center changed the payroll allocation methodology during the year under audit but this change was not documented in the policies and procedures. We also did not obtain evidence for review and approval of several payroll registers. Cause: During 2023, the Center's finance department turned over significantly, resulting in oversight of some the salary and wages procedures. Effect or Potential Effect: Salary expenditures that are not charged in accordance with the standards referenced above may be questioned or disallowed by the donor. Questioned Costs: Undetermined Context: This is a condition identified per review of the Center's compliance with the specified requirements using a statistically valid sample. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend that management revisit its procedures for transferring data from the timekeeping system to the general ledger and implement proper internal controls to ensure that the amounts of salary expenditures charged to projects in the general ledger reconcile to the amounts calculated by the timekeeping system and current wages and salaries.We also recommend the payroll registers be reviewed and approved by management immediately upon receipt; any discrepancies or issues must be addressed with the accounting department within a timely period following the close of the payroll period. We also recommend that any change in the payroll allocation methodology be formalized in writing and incorporated into the accounting policies and procedures manual.
Finding 2023-003: Salaries and Wages (Allowable Costs) Federal Programs: All programs Criteria: According to 2 CFR Section 200.430(i), charges to Federal grants for salaries and wages must be based on records that accurately reflect the work performed and the records must: i. Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; ii. Be incorporated into the official records of the non-Federal entity; iii. Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; iv. Encompass Federally-assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; v. Comply with the established accounting policies and practices of the non-Federal entity; vi. [Reserved] vii. Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. viii. Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards.” Condition: The Center has a timekeeping system in place that provides for employees to record hours worked to specific cost objectives, including to US Government grants. However, we noted one instance the allocation amount as per the timekeeping system with the applicable compensation amount paid to the employee was different from the amounts ultimately recorded within the Center's general ledger. While the difference was not significant, this discrepancy indicate a deficiency in the internal controls around recording of salary expenditures to projects. We also noted the Center changed the payroll allocation methodology during the year under audit but this change was not documented in the policies and procedures. We also did not obtain evidence for review and approval of several payroll registers. Cause: During 2023, the Center's finance department turned over significantly, resulting in oversight of some the salary and wages procedures. Effect or Potential Effect: Salary expenditures that are not charged in accordance with the standards referenced above may be questioned or disallowed by the donor. Questioned Costs: Undetermined Context: This is a condition identified per review of the Center's compliance with the specified requirements using a statistically valid sample. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend that management revisit its procedures for transferring data from the timekeeping system to the general ledger and implement proper internal controls to ensure that the amounts of salary expenditures charged to projects in the general ledger reconcile to the amounts calculated by the timekeeping system and current wages and salaries.We also recommend the payroll registers be reviewed and approved by management immediately upon receipt; any discrepancies or issues must be addressed with the accounting department within a timely period following the close of the payroll period. We also recommend that any change in the payroll allocation methodology be formalized in writing and incorporated into the accounting policies and procedures manual.
Finding 2023-003: Salaries and Wages (Allowable Costs) Federal Programs: All programs Criteria: According to 2 CFR Section 200.430(i), charges to Federal grants for salaries and wages must be based on records that accurately reflect the work performed and the records must: i. Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; ii. Be incorporated into the official records of the non-Federal entity; iii. Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; iv. Encompass Federally-assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; v. Comply with the established accounting policies and practices of the non-Federal entity; vi. [Reserved] vii. Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. viii. Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards.” Condition: The Center has a timekeeping system in place that provides for employees to record hours worked to specific cost objectives, including to US Government grants. However, we noted one instance the allocation amount as per the timekeeping system with the applicable compensation amount paid to the employee was different from the amounts ultimately recorded within the Center's general ledger. While the difference was not significant, this discrepancy indicate a deficiency in the internal controls around recording of salary expenditures to projects. We also noted the Center changed the payroll allocation methodology during the year under audit but this change was not documented in the policies and procedures. We also did not obtain evidence for review and approval of several payroll registers. Cause: During 2023, the Center's finance department turned over significantly, resulting in oversight of some the salary and wages procedures. Effect or Potential Effect: Salary expenditures that are not charged in accordance with the standards referenced above may be questioned or disallowed by the donor. Questioned Costs: Undetermined Context: This is a condition identified per review of the Center's compliance with the specified requirements using a statistically valid sample. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend that management revisit its procedures for transferring data from the timekeeping system to the general ledger and implement proper internal controls to ensure that the amounts of salary expenditures charged to projects in the general ledger reconcile to the amounts calculated by the timekeeping system and current wages and salaries.We also recommend the payroll registers be reviewed and approved by management immediately upon receipt; any discrepancies or issues must be addressed with the accounting department within a timely period following the close of the payroll period. We also recommend that any change in the payroll allocation methodology be formalized in writing and incorporated into the accounting policies and procedures manual.
Finding 2023-003: Salaries and Wages (Allowable Costs) Federal Programs: All programs Criteria: According to 2 CFR Section 200.430(i), charges to Federal grants for salaries and wages must be based on records that accurately reflect the work performed and the records must: i. Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; ii. Be incorporated into the official records of the non-Federal entity; iii. Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; iv. Encompass Federally-assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; v. Comply with the established accounting policies and practices of the non-Federal entity; vi. [Reserved] vii. Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. viii. Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards.” Condition: The Center has a timekeeping system in place that provides for employees to record hours worked to specific cost objectives, including to US Government grants. However, we noted one instance the allocation amount as per the timekeeping system with the applicable compensation amount paid to the employee was different from the amounts ultimately recorded within the Center's general ledger. While the difference was not significant, this discrepancy indicate a deficiency in the internal controls around recording of salary expenditures to projects. We also noted the Center changed the payroll allocation methodology during the year under audit but this change was not documented in the policies and procedures. We also did not obtain evidence for review and approval of several payroll registers. Cause: During 2023, the Center's finance department turned over significantly, resulting in oversight of some the salary and wages procedures. Effect or Potential Effect: Salary expenditures that are not charged in accordance with the standards referenced above may be questioned or disallowed by the donor. Questioned Costs: Undetermined Context: This is a condition identified per review of the Center's compliance with the specified requirements using a statistically valid sample. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend that management revisit its procedures for transferring data from the timekeeping system to the general ledger and implement proper internal controls to ensure that the amounts of salary expenditures charged to projects in the general ledger reconcile to the amounts calculated by the timekeeping system and current wages and salaries.We also recommend the payroll registers be reviewed and approved by management immediately upon receipt; any discrepancies or issues must be addressed with the accounting department within a timely period following the close of the payroll period. We also recommend that any change in the payroll allocation methodology be formalized in writing and incorporated into the accounting policies and procedures manual.
Section III – Federal Award Findings and Questioned Costs Finding: #2023-001 Program Title: Block Grants for Community Mental Health Services, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing: 93.958, 21.027 Contract Grant Number: HHS000063200002 & HHS00477100002, 2023-02-02-0043 Federal Award Years: September 1, 2022 to August 31, 2024, March 1, 2023 to February 28, 2025 Federal Agency: U.S. Department of Health and Human Services, U.S. Department of Treasury Allowable Costs Type of Finding: Significant Deficiency and Other Noncompliance Criteria: 2 CFR part 200 establishes cost principles for determining costs applicable to Federal Awards and requires costs be adequately documented. In addition, 2 CFR section 200.430 establishes standards for documentation of personnel expenses with the terms and conditions of the federal award. These awards are subject to the requirements set forth in 45 CFR Part 75, which defines the standards for documentation of personnel expenses as charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. The 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; a federal award and non-federal award, an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: Based on procedures performed, we identified payroll expenditures allocated among federal award programs that were not supported by the time and effort allocation certifications. As a result, verification documentation of payroll allocations across federal award programs was not obtained. Cause: Lack of documentation to support payroll allocations across federal award programs. Effect: Noncompliance with Allowable Costs compliance requirements of the Uniform Guidance and terms and conditions of the federal award. Repeat Finding: No Recommendation: We recommend Form Communities improve procedures for tracking and reporting of time allocations across federal award programs to ensure compliance with the compliance requirements and terms and conditions of federal awards. Views of Responsible Officials: Management agrees with the recommendations to improve tracking and reporting of time allocations across federal award programs to conform with the compliance requirements and terms and conditions of federal awards.
Section III – Federal Award Findings and Questioned Costs Finding: #2023-001 Program Title: Block Grants for Community Mental Health Services, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing: 93.958, 21.027 Contract Grant Number: HHS000063200002 & HHS00477100002, 2023-02-02-0043 Federal Award Years: September 1, 2022 to August 31, 2024, March 1, 2023 to February 28, 2025 Federal Agency: U.S. Department of Health and Human Services, U.S. Department of Treasury Allowable Costs Type of Finding: Significant Deficiency and Other Noncompliance Criteria: 2 CFR part 200 establishes cost principles for determining costs applicable to Federal Awards and requires costs be adequately documented. In addition, 2 CFR section 200.430 establishes standards for documentation of personnel expenses with the terms and conditions of the federal award. These awards are subject to the requirements set forth in 45 CFR Part 75, which defines the standards for documentation of personnel expenses as charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. The 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; a federal award and non-federal award, an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: Based on procedures performed, we identified payroll expenditures allocated among federal award programs that were not supported by the time and effort allocation certifications. As a result, verification documentation of payroll allocations across federal award programs was not obtained. Cause: Lack of documentation to support payroll allocations across federal award programs. Effect: Noncompliance with Allowable Costs compliance requirements of the Uniform Guidance and terms and conditions of the federal award. Repeat Finding: No Recommendation: We recommend Form Communities improve procedures for tracking and reporting of time allocations across federal award programs to ensure compliance with the compliance requirements and terms and conditions of federal awards. Views of Responsible Officials: Management agrees with the recommendations to improve tracking and reporting of time allocations across federal award programs to conform with the compliance requirements and terms and conditions of federal awards.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.267 Program: Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 202212-01122, 202212-01115, DA-202212-01187, 202210-00966, DA-202212-01319 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation- Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non- Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally-assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non- Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non-Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that LifeWire allocated administrative payroll expenditures to Continuum of Care during 2023 based on budget allocation rates. There were no procedures in place to determine if a true-up was necessary from allocated costs. 27 timesheets were tested during the audit, of which five were charged based on budgets for the grant. Cause: LifeWire did not have policies and procedures in place to review and reconcile the estimated amounts of payroll expenditures charged to Continuum of Care to the actual expenditures incurred. Effect or Potential Effect: Without adequate controls in place to ensure costs based on budgeted allocations are reasonable and reconcile to the actual time spent on the program, LifeWire could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement LifeWire is entitle to under the terms of the grant. Questioned Costs: Below reporting threshold. Context: This is a condition identified per review of LifeWire’s compliance with specified requirements not using a statistically valid sample. Payroll costs for administrative staff selected for testing totaled $1,185. Total payroll costs for the Continuum of Care grants in 2023 were $294,002. Any payroll costs not adequately supported by time and effort reports are considered questioned costs. Identification as a Repeat Finding: Not a repeat finding. Recommendation: We recommend that LifeWire implement policies and procedures to review for any necessary budget to actual adjustments, and we recommend that sufficient documentation be maintained to support any adjustments made as required by 2 CFR §200.430. Views of Responsible Officials: Management agrees with the finding. Management has modified policies and procedures to ensure staff time allocated to the grant is properly reviewed and approved.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.267 Program: Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 202212-01122, 202212-01115, DA-202212-01187, 202210-00966, DA-202212-01319 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation- Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non- Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally-assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non- Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non-Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that LifeWire allocated administrative payroll expenditures to Continuum of Care during 2023 based on budget allocation rates. There were no procedures in place to determine if a true-up was necessary from allocated costs. 27 timesheets were tested during the audit, of which five were charged based on budgets for the grant. Cause: LifeWire did not have policies and procedures in place to review and reconcile the estimated amounts of payroll expenditures charged to Continuum of Care to the actual expenditures incurred. Effect or Potential Effect: Without adequate controls in place to ensure costs based on budgeted allocations are reasonable and reconcile to the actual time spent on the program, LifeWire could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement LifeWire is entitle to under the terms of the grant. Questioned Costs: Below reporting threshold. Context: This is a condition identified per review of LifeWire’s compliance with specified requirements not using a statistically valid sample. Payroll costs for administrative staff selected for testing totaled $1,185. Total payroll costs for the Continuum of Care grants in 2023 were $294,002. Any payroll costs not adequately supported by time and effort reports are considered questioned costs. Identification as a Repeat Finding: Not a repeat finding. Recommendation: We recommend that LifeWire implement policies and procedures to review for any necessary budget to actual adjustments, and we recommend that sufficient documentation be maintained to support any adjustments made as required by 2 CFR §200.430. Views of Responsible Officials: Management agrees with the finding. Management has modified policies and procedures to ensure staff time allocated to the grant is properly reviewed and approved.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.267 Program: Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 202212-01122, 202212-01115, DA-202212-01187, 202210-00966, DA-202212-01319 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation- Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non- Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally-assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non- Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non-Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that LifeWire allocated administrative payroll expenditures to Continuum of Care during 2023 based on budget allocation rates. There were no procedures in place to determine if a true-up was necessary from allocated costs. 27 timesheets were tested during the audit, of which five were charged based on budgets for the grant. Cause: LifeWire did not have policies and procedures in place to review and reconcile the estimated amounts of payroll expenditures charged to Continuum of Care to the actual expenditures incurred. Effect or Potential Effect: Without adequate controls in place to ensure costs based on budgeted allocations are reasonable and reconcile to the actual time spent on the program, LifeWire could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement LifeWire is entitle to under the terms of the grant. Questioned Costs: Below reporting threshold. Context: This is a condition identified per review of LifeWire’s compliance with specified requirements not using a statistically valid sample. Payroll costs for administrative staff selected for testing totaled $1,185. Total payroll costs for the Continuum of Care grants in 2023 were $294,002. Any payroll costs not adequately supported by time and effort reports are considered questioned costs. Identification as a Repeat Finding: Not a repeat finding. Recommendation: We recommend that LifeWire implement policies and procedures to review for any necessary budget to actual adjustments, and we recommend that sufficient documentation be maintained to support any adjustments made as required by 2 CFR §200.430. Views of Responsible Officials: Management agrees with the finding. Management has modified policies and procedures to ensure staff time allocated to the grant is properly reviewed and approved.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.267 Program: Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 202212-01122, 202212-01115, DA-202212-01187, 202210-00966, DA-202212-01319 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation- Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non- Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally-assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non- Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non-Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that LifeWire allocated administrative payroll expenditures to Continuum of Care during 2023 based on budget allocation rates. There were no procedures in place to determine if a true-up was necessary from allocated costs. 27 timesheets were tested during the audit, of which five were charged based on budgets for the grant. Cause: LifeWire did not have policies and procedures in place to review and reconcile the estimated amounts of payroll expenditures charged to Continuum of Care to the actual expenditures incurred. Effect or Potential Effect: Without adequate controls in place to ensure costs based on budgeted allocations are reasonable and reconcile to the actual time spent on the program, LifeWire could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement LifeWire is entitle to under the terms of the grant. Questioned Costs: Below reporting threshold. Context: This is a condition identified per review of LifeWire’s compliance with specified requirements not using a statistically valid sample. Payroll costs for administrative staff selected for testing totaled $1,185. Total payroll costs for the Continuum of Care grants in 2023 were $294,002. Any payroll costs not adequately supported by time and effort reports are considered questioned costs. Identification as a Repeat Finding: Not a repeat finding. Recommendation: We recommend that LifeWire implement policies and procedures to review for any necessary budget to actual adjustments, and we recommend that sufficient documentation be maintained to support any adjustments made as required by 2 CFR §200.430. Views of Responsible Officials: Management agrees with the finding. Management has modified policies and procedures to ensure staff time allocated to the grant is properly reviewed and approved.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.267 Program: Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: 202212-01122, 202212-01115, DA-202212-01187, 202210-00966, DA-202212-01319 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation- Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non- Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally-assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non- Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non-Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that LifeWire allocated administrative payroll expenditures to Continuum of Care during 2023 based on budget allocation rates. There were no procedures in place to determine if a true-up was necessary from allocated costs. 27 timesheets were tested during the audit, of which five were charged based on budgets for the grant. Cause: LifeWire did not have policies and procedures in place to review and reconcile the estimated amounts of payroll expenditures charged to Continuum of Care to the actual expenditures incurred. Effect or Potential Effect: Without adequate controls in place to ensure costs based on budgeted allocations are reasonable and reconcile to the actual time spent on the program, LifeWire could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement LifeWire is entitle to under the terms of the grant. Questioned Costs: Below reporting threshold. Context: This is a condition identified per review of LifeWire’s compliance with specified requirements not using a statistically valid sample. Payroll costs for administrative staff selected for testing totaled $1,185. Total payroll costs for the Continuum of Care grants in 2023 were $294,002. Any payroll costs not adequately supported by time and effort reports are considered questioned costs. Identification as a Repeat Finding: Not a repeat finding. Recommendation: We recommend that LifeWire implement policies and procedures to review for any necessary budget to actual adjustments, and we recommend that sufficient documentation be maintained to support any adjustments made as required by 2 CFR §200.430. Views of Responsible Officials: Management agrees with the finding. Management has modified policies and procedures to ensure staff time allocated to the grant is properly reviewed and approved.
Criteria Part 2, CFR Part 200.430 notes “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed”. The document continues to state that documentation must “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Condition While performing tests of the Garden’s internal controls over payroll transactions, we noted the Garden had incorrectly allocated time of 8 of the 40 selections. Cause of Condition The Garden has not implemented proper internal control policies to adhere to the requirements of the Uniform Guidance. Effect of Condition Noncompliance may impact future funding from Federal awards. Recommendation We recommend the Garden implement proper internal control procedures to document hours worked, by employee, by grant; and maintain the documentation to support charges allocated to each Federal award.
Criteria Part 2, CFR Part 200.430 notes “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed”. The document continues to state that documentation must “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Condition While performing tests of the Garden’s internal controls over payroll transactions, we noted the Garden had incorrectly allocated time of 8 of the 40 selections. Cause of Condition The Garden has not implemented proper internal control policies to adhere to the requirements of the Uniform Guidance. Effect of Condition Noncompliance may impact future funding from Federal awards. Recommendation We recommend the Garden implement proper internal control procedures to document hours worked, by employee, by grant; and maintain the documentation to support charges allocated to each Federal award.
Criteria Part 2, CFR Part 200.430 notes “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed”. The document continues to state that documentation must “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Condition While performing tests of the Garden’s internal controls over payroll transactions, we noted the Garden had incorrectly allocated time of 8 of the 40 selections. Cause of Condition The Garden has not implemented proper internal control policies to adhere to the requirements of the Uniform Guidance. Effect of Condition Noncompliance may impact future funding from Federal awards. Recommendation We recommend the Garden implement proper internal control procedures to document hours worked, by employee, by grant; and maintain the documentation to support charges allocated to each Federal award.
Criteria Part 2, CFR Part 200.430 notes “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed”. The document continues to state that documentation must “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Condition While performing tests of the Garden’s internal controls over payroll transactions, we noted the Garden had incorrectly allocated time of 8 of the 40 selections. Cause of Condition The Garden has not implemented proper internal control policies to adhere to the requirements of the Uniform Guidance. Effect of Condition Noncompliance may impact future funding from Federal awards. Recommendation We recommend the Garden implement proper internal control procedures to document hours worked, by employee, by grant; and maintain the documentation to support charges allocated to each Federal award.
Criteria Part 2, CFR Part 200.430 notes “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed”. The document continues to state that documentation must “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Condition While performing tests of the Garden’s internal controls over payroll transactions, we noted the Garden had incorrectly allocated time of 8 of the 40 selections. Cause of Condition The Garden has not implemented proper internal control policies to adhere to the requirements of the Uniform Guidance. Effect of Condition Noncompliance may impact future funding from Federal awards. Recommendation We recommend the Garden implement proper internal control procedures to document hours worked, by employee, by grant; and maintain the documentation to support charges allocated to each Federal award.
Criteria Part 2, CFR Part 200.430 notes “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed”. The document continues to state that documentation must “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Condition While performing tests of the Garden’s internal controls over payroll transactions, we noted the Garden had incorrectly allocated time of 8 of the 40 selections. Cause of Condition The Garden has not implemented proper internal control policies to adhere to the requirements of the Uniform Guidance. Effect of Condition Noncompliance may impact future funding from Federal awards. Recommendation We recommend the Garden implement proper internal control procedures to document hours worked, by employee, by grant; and maintain the documentation to support charges allocated to each Federal award.
Criteria Part 2, CFR Part 200.430 notes “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed”. The document continues to state that documentation must “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Condition While performing tests of the Garden’s internal controls over payroll transactions, we noted the Garden had incorrectly allocated time of 8 of the 40 selections. Cause of Condition The Garden has not implemented proper internal control policies to adhere to the requirements of the Uniform Guidance. Effect of Condition Noncompliance may impact future funding from Federal awards. Recommendation We recommend the Garden implement proper internal control procedures to document hours worked, by employee, by grant; and maintain the documentation to support charges allocated to each Federal award.
Criteria Part 2, CFR Part 200.430 notes “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed”. The document continues to state that documentation must “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Condition While performing tests of the Garden’s internal controls over payroll transactions, we noted the Garden had incorrectly allocated time of 8 of the 40 selections. Cause of Condition The Garden has not implemented proper internal control policies to adhere to the requirements of the Uniform Guidance. Effect of Condition Noncompliance may impact future funding from Federal awards. Recommendation We recommend the Garden implement proper internal control procedures to document hours worked, by employee, by grant; and maintain the documentation to support charges allocated to each Federal award.
Criteria Part 2, CFR Part 200.430 notes “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed”. The document continues to state that documentation must “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Condition While performing tests of the Garden’s internal controls over payroll transactions, we noted the Garden had incorrectly allocated time of 8 of the 40 selections. Cause of Condition The Garden has not implemented proper internal control policies to adhere to the requirements of the Uniform Guidance. Effect of Condition Noncompliance may impact future funding from Federal awards. Recommendation We recommend the Garden implement proper internal control procedures to document hours worked, by employee, by grant; and maintain the documentation to support charges allocated to each Federal award.
Criteria Part 2, CFR Part 200.430 notes “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed”. The document continues to state that documentation must “Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.” Condition While performing tests of the Garden’s internal controls over payroll transactions, we noted the Garden had incorrectly allocated time of 8 of the 40 selections. Cause of Condition The Garden has not implemented proper internal control policies to adhere to the requirements of the Uniform Guidance. Effect of Condition Noncompliance may impact future funding from Federal awards. Recommendation We recommend the Garden implement proper internal control procedures to document hours worked, by employee, by grant; and maintain the documentation to support charges allocated to each Federal award.
Allowable Costs Questioned Costs: N/A Department of Labor 17.258 WIOA Adult Program (WAP) 17.259 WIOA Youth Program (WYP) 17.278 WIOA Dislocated Worker Program (DW) Grant No(s): AA-36322-21-55-A22, AA-38532-22-55-A-22 Criteria: Costs charged to Federal grants must meet the provisions of the standards for documentation of personnel expenses contained in 2 CFR 200.430(i)(1) which requires that charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. This would include supervisory approval of timesheets/records which accurately support the employee’s time for each pay period. Condition: Out of 20 employees’ time sheets/paychecks tested, 10 lacked supervisor approval. Universe/ Population: For a sample of 20 payroll charges totaling $25,786, we attempted to observe timesheets and their supervisory review to determine if proper internal controls were in place. Effect: Although further audit procedures indicated that the 10 employees’ costs were appropriately charged to the program, without proper internal controls over review and documentation of personnel expenses, appropriate levels of review may not occur, and therefore, the City-Parish may be at risk for unallowable costs being charged to the program. Cause: The lack of internal controls is a result of staff turnover, the COVID-19 pandemic, resource constraints and the lack of adherence to written policies and procedures to ensure compliance with federal requirements. Documentation of time sheet review and approval of a supervisor was not consistently maintained during the fiscal year. Recommendation: The WIOA (Employ BR) program should adhere to written policies and procedures that ensure that all salaries and wages and related benefit costs are charged to the Federal program based on records that reflect the work performed, which are reviewed and approved by a supervisor. This documentation of approval should be written and kept contemporaneously each pay period. View of Responsible Official: To improve the accuracy and timeliness of payroll processing, a revised payroll procedures manual will be developed and disseminated to all staff responsible for time approval. Additionally, mandatory training on the ExecuTime system will be conducted for these staff members to ensure they have the necessary skills for proper and timely time sheet approvals.
Allowable Costs Questioned Costs: N/A Department of Labor 17.258 WIOA Adult Program (WAP) 17.259 WIOA Youth Program (WYP) 17.278 WIOA Dislocated Worker Program (DW) Grant No(s): AA-36322-21-55-A22, AA-38532-22-55-A-22 Criteria: Costs charged to Federal grants must meet the provisions of the standards for documentation of personnel expenses contained in 2 CFR 200.430(i)(1) which requires that charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. This would include supervisory approval of timesheets/records which accurately support the employee’s time for each pay period. Condition: Out of 20 employees’ time sheets/paychecks tested, 10 lacked supervisor approval. Universe/ Population: For a sample of 20 payroll charges totaling $25,786, we attempted to observe timesheets and their supervisory review to determine if proper internal controls were in place. Effect: Although further audit procedures indicated that the 10 employees’ costs were appropriately charged to the program, without proper internal controls over review and documentation of personnel expenses, appropriate levels of review may not occur, and therefore, the City-Parish may be at risk for unallowable costs being charged to the program. Cause: The lack of internal controls is a result of staff turnover, the COVID-19 pandemic, resource constraints and the lack of adherence to written policies and procedures to ensure compliance with federal requirements. Documentation of time sheet review and approval of a supervisor was not consistently maintained during the fiscal year. Recommendation: The WIOA (Employ BR) program should adhere to written policies and procedures that ensure that all salaries and wages and related benefit costs are charged to the Federal program based on records that reflect the work performed, which are reviewed and approved by a supervisor. This documentation of approval should be written and kept contemporaneously each pay period. View of Responsible Official: To improve the accuracy and timeliness of payroll processing, a revised payroll procedures manual will be developed and disseminated to all staff responsible for time approval. Additionally, mandatory training on the ExecuTime system will be conducted for these staff members to ensure they have the necessary skills for proper and timely time sheet approvals.
Allowable Costs Questioned Costs: N/A Department of Labor 17.258 WIOA Adult Program (WAP) 17.259 WIOA Youth Program (WYP) 17.278 WIOA Dislocated Worker Program (DW) Grant No(s): AA-36322-21-55-A22, AA-38532-22-55-A-22 Criteria: Costs charged to Federal grants must meet the provisions of the standards for documentation of personnel expenses contained in 2 CFR 200.430(i)(1) which requires that charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. This would include supervisory approval of timesheets/records which accurately support the employee’s time for each pay period. Condition: Out of 20 employees’ time sheets/paychecks tested, 10 lacked supervisor approval. Universe/ Population: For a sample of 20 payroll charges totaling $25,786, we attempted to observe timesheets and their supervisory review to determine if proper internal controls were in place. Effect: Although further audit procedures indicated that the 10 employees’ costs were appropriately charged to the program, without proper internal controls over review and documentation of personnel expenses, appropriate levels of review may not occur, and therefore, the City-Parish may be at risk for unallowable costs being charged to the program. Cause: The lack of internal controls is a result of staff turnover, the COVID-19 pandemic, resource constraints and the lack of adherence to written policies and procedures to ensure compliance with federal requirements. Documentation of time sheet review and approval of a supervisor was not consistently maintained during the fiscal year. Recommendation: The WIOA (Employ BR) program should adhere to written policies and procedures that ensure that all salaries and wages and related benefit costs are charged to the Federal program based on records that reflect the work performed, which are reviewed and approved by a supervisor. This documentation of approval should be written and kept contemporaneously each pay period. View of Responsible Official: To improve the accuracy and timeliness of payroll processing, a revised payroll procedures manual will be developed and disseminated to all staff responsible for time approval. Additionally, mandatory training on the ExecuTime system will be conducted for these staff members to ensure they have the necessary skills for proper and timely time sheet approvals.
Finding 2023-001 - Significant Deficiency, Compliance Federal Assistance Listing Number. 21.027 U.S. Department Of Treasury State and Local Fiscal Recovery Funds – Allowable Costs Criteria: According to 2 CFR 200.430(i)(1)(vii) “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:….(vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity….”. Additionally, according to 2 CFR 200.413(a) “Cost incurred for the same purpose in like circumstances must be treated consistently as either direct or indirect (F&A) costs.” Condition: In our nonstatistical sample of 13 allowable cost selections we identified 2 payments that covered payroll costs that were not supported by sufficient documentation of time and effort for one employee. For select administrative employees for which time was allocated to the grant, the use of a fringe benefits rate included the allocation of rent built into the rate when rent was already billed as a direct cost. Context: Monthly payroll was billed to EnterpriseKC and to the grant by a related organization based on the time and effort tracked by the related organization for that month; however, it was noted that one employee’s full salary was billed to the grant and the time and effort spent on grant-related activities was less than full-time, with remaining time being spent on non-Federal award activities. Based on the employee’s time spent on the grant related activities the employee’s payroll costs billed to the grant for the 2 months evaluated was overbilled to the grant by $10,416. The related organization also billed EnterpriseKC and the grant for administrative employees’ time using an hourly billing rate that was determined by using the employees’ salaries divided by the standard hours worked plus an estimate of fringe benefits that ranged from 25% to 32%. The fringe benefits rate included allocation of rent expense which was already separately billed by the related organization as a direct cost. The actual fringe benefit rate excluding the rent was approximately 24% which resulted in estimated overbillings to the grant for the 2 months reviewed totaling $149. Effect: As a result of the overbillings noted, the grant expenditures were overstated by $10,565 for the questioned costs identified. Questioned Costs: Known questioned costs totaled $10,565. Additional likely questioned costs totaled $39,937 and were determined by allocating the percentage of known questioned costs as a percentage of the total costs included in the sample tested from the related organization multiplied by the total costs incurred with the related organization. It was not considered appropriate to project questioned costs to the remaining population of costs as the questioned costs were isolated to payroll related costs. Cause: EnterpriseKC did not have internal controls in place with sufficient precision to detect errors related to overbilling payroll costs to the grant. Further, EnterpriseKC did not have controls in place to ensure that direct costs billed to the grant were not duplicated by also being included in the payroll fringe rate. Identification Of Repeat Finding: This is not a repeat finding. Recommendation: We recommend that EnterpriseKC should ensure that any payroll costs for each individual employee allocated to the grant are supported by appropriate time and effort. We recommend that EnterpriseKC ensure that its billing rate for administrative employees only includes allocable fringe benefits and does not including any costs already separately billed as a direct cost. Views Of Responsible Officials (Unaudited): Management will implement a comprehensive time tracking review process that also extends to reviewing time for employees that choose to work remotely and will ensure that time not allocated to the grant is not included in the costs allocated to the grant. Management will revise the fringe benefit rate that gets charged to the hourly rates to ensure that none of the costs included in the fringe benefits are also direct expenses billed to the grant. The unallowable costs will be redirected to other allowable grant costs in 2024. Anticipated Completion Date: September 2024 Contact Person: Jay Konomos, Pillar Leader
Finding 2023-001 – Allocation of Fringe Benefits Federal Agency: U.S. Department of Health and Human Services Major Program: AL# 93.104 Comprehensive Community Mental Health Services for Children with Serious Emotional Disturbances (SED) Type of Finding: Significant deficiency in Internal Control over Compliance (Allowable Costs) Criteria: Per guidance: 2CFR 200.431 Compensation—fringe benefits.(i) (1) … Costs of severance pay are allowable only to the extent that in each case, it is required by (i) Law; (ii) Employer-employee agreement; (iii) Established policy that constitutes, in effect, an implied agreement on the non-Federal entity's part; or (iv) Circumstances of the particular employment. In accordance with 2 CFR 200.430(i), payroll costs charged to federal awards must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Condition: The Organization allocates fringe costs to grants based on budget while capturing actual costs in a fringe cost pool. During the audit we found that the fringe cost pool contained severance pay that exceeded the organization policy and thus unallowable. The removal of these costs resulted in the overcharging of fringe benefits to all projects. Questioned Costs: None Cause: Management does not have sufficient internal controls to ensure fringe benefits are allowable and that estimated fringe allocations represent with actual costs. Effect: Expenditures that are not properly identified within the accounting system or supported by underlying documentation are at risk of being owed back to the funding source. Recommendation: Management and those charged with governance should consider increasing controls around ensuring costs charged to the fringe pool are allowable under Uniform Guidance cost principles. The fringe allocation percentage for reimbursement should be reviewed and approved to ensure it represents actual direct costs incurred. This review should be documented and performed monthly (quarterly at minimum). Management’s Response: Management’s response to the finding is discussed in the attached Corrective Action Plan.
Significant Deficiency in Internal Control and Compliance over Major Programs Funding Agency: Department of Treasury ALN: 21.027 Criteria Internal controls and other compliance knowledge should prevent the incorrect coding of employee hours worked. Per 2 CFR 200.430(i)(1), "charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed." Condition Internal controls and adherence to compliance were not followed with regards to an appropriate level of approval of management that is charged to the Coronavirus State and Local Recovery Funds program. Questioned costs Total questioned cost of $7,475 based on six payroll transactions tested that were not approved at the appropriate level but were charged to the Coronavirus State and Loval Recovery Fund grant (ALN 21.027). Context During our payroll testing, of the six executive director timesheets tested, none of them indicated a secondary control offsetting the program manager. Effect The Coronavirus State and Local Recovery Funds program and other federal programs could be incorrectly charged. Cause The error was caused by not applying an adequate number of controls necessary for the executive director's timesheet. Repeat Finding Yes Auditor's Recommendation JSP recommends that the program manager and a member of the finance committee knowledge about 2 CFR 200.430(i)(1) review the executive director costs charged to the Coronavirus State and Local Recovery Funds program.
Finding 2023-001 – Allowable Costs/Cost Principles, Internal Control Identification of the federal program Assistance listing number and title: 93.493 Congressional Directives Agency: U.S. Department of Health and Human Services Federal award identification number (FAIN): H79FG000881 Federal award year: 2022 Criteria or specific requirement (including statutory, regulatory or other citation) 2 CFR 200.303(a) requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls would be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” 2 CFR 200.430(i)(1)(i) states that charges to Federal awards for salaries and wages must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. 2 CFR 200.430(i)(1)(v) also provides that salaries and wages must comply with the established accounting policies and practices of the non-Federal entity. Condition For four (4) of forty (40) payroll expenditures selected for testing, the System’s management did not perform the internal controls over the required allowability criteria. Cause The System failed to effectively implement controls over the required allowability criteria. Effect or potential effect Costs charged to Federal awards may be inaccurate, unallowable, or improperly allocated. Questioned costs None. Context From the population of payroll expenditures totaling $939,170, EY randomly selected 40 employees from different pay periods in 2023 totaling $94,279. Out of the 40 selections, 4 (or 10%) of employees’ timecards did not have evidence of manager’s review and approval of their time charged to the grant totaling $12,463 prior to processing payroll. Identification as a repeat finding, if applicable Not a repeat finding. Recommendation We recommend management to implement effective internal controls over the allowability of costs charged to the federal program. Management must ensure that costs charged to the federal program are adequately documented and reviewed. Views of responsible officials Management will implement an additional review and approval process. Staff assigned to grant activities will provide a screenshot of their bi-weekly timecard to their manager for review and approval. Upon manager review, the document will be forwarded to the grant program leadership team for approval and documentation.
Finding No. 2023-001: Allowable Costs/Cost Principles Program: AL# 10.331 - Gus Schumacher Nutrition Incentive Program (GUSNIP/GUCRR) Federal Grantor: U.S. Department of Agriculture Criteria – Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: I. Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; II. Be incorporated into the official records of the non-Federal entity; III. Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; IV. Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis; V. Comply with the established accounting policies and practices of the non-Federal entity; VI. Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non- Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Citation – 2 CFR 200.430 (i) Condition – Salary expense allocated and charged to Federal awards did not agree to timesheet reports that were signed by the employee and their direct supervisor. Additionally, timesheets were not properly approved by a supervisor. Cause – Budgeted rates were used to calculate the amount charged to the grant. Employees that worked exclusively on the grant covered by the Federal award had timesheets to support the time spent on the grant. Effect – The amount of salary expense and related fringe benefits charged to the Federal award did not meet the criteria outlined above. This leads to a risk that inaccurate charges could be made to the Federal award. Questioned Costs – None – the Organization was able to provide alternative methods to demonstrate that costs charged to the grant were less than actual amount incurred.Context - For 2 out of 4 employees tested, the salary allocated did not agree to the timesheet reports. Additionally, for 1 out 4 employees tested, the timesheet did not reflect a supervisor approval/signature as required by the Organization’s handbook policy. Repeat Finding - Yes - Finding 2022-003. Please see Summary Schedule of Prior Year Audit Findings. Recommendation - We recommend that the Organization follows policies and procedures to ensure compliance with proper payroll documentation. We also recommend that timesheets be used to support all allocations as the basis for recording salary to the books and used as the source of costs that get charged to Federal awards. Views of Responsible Officials - See Corrective Action Plan.
Finding No. 2023-001: Allowable Costs/Cost Principles Program: AL# 10.331 - Gus Schumacher Nutrition Incentive Program (GUSNIP/GUCRR) Federal Grantor: U.S. Department of Agriculture Criteria – Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: I. Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; II. Be incorporated into the official records of the non-Federal entity; III. Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; IV. Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis; V. Comply with the established accounting policies and practices of the non-Federal entity; VI. Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non- Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Citation – 2 CFR 200.430 (i) Condition – Salary expense allocated and charged to Federal awards did not agree to timesheet reports that were signed by the employee and their direct supervisor. Additionally, timesheets were not properly approved by a supervisor. Cause – Budgeted rates were used to calculate the amount charged to the grant. Employees that worked exclusively on the grant covered by the Federal award had timesheets to support the time spent on the grant. Effect – The amount of salary expense and related fringe benefits charged to the Federal award did not meet the criteria outlined above. This leads to a risk that inaccurate charges could be made to the Federal award. Questioned Costs – None – the Organization was able to provide alternative methods to demonstrate that costs charged to the grant were less than actual amount incurred.Context - For 2 out of 4 employees tested, the salary allocated did not agree to the timesheet reports. Additionally, for 1 out 4 employees tested, the timesheet did not reflect a supervisor approval/signature as required by the Organization’s handbook policy. Repeat Finding - Yes - Finding 2022-003. Please see Summary Schedule of Prior Year Audit Findings. Recommendation - We recommend that the Organization follows policies and procedures to ensure compliance with proper payroll documentation. We also recommend that timesheets be used to support all allocations as the basis for recording salary to the books and used as the source of costs that get charged to Federal awards. Views of Responsible Officials - See Corrective Action Plan.
2023-001. Allowable Costs/Cost Principles United States Department of Health and Human Services, Substance Abuse and Mental Health Services Administration: Substance Abuse and Mental Health Services Projects of Regional and National Significance Passed Through Vibrant Emotional Health: National Suicide Prevention Lifeline: 988 National Chat and Text Backup 93.243 S23-SM84816-048 988 National Backup Chat and Text Subnetwork 93.243 S24-SM84816-048-CTP 988 National Phone Backup 93.243 S23-SM84816-048 988 National Backup Phone Subnetwork 93.243 S24-SM84816-048-PB Disaster Distress Helpline: Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-048 Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-049 Disaster Distress Helpline Online Peer Support Center 93.243 S24-SM84816-048-DDH OPS Criteria: Uniform Guidance 2 CFR 200.430, covers standards for documentation of compensation-personal services. Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed and time spent. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, these records should support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and non-federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: Time records prepared by employees reflect the total hours worked for the day, but do not reflect the actual time spent on programs funded by a federal award, rather they are based on budgeted hours, and scheduled for true-up at a later date. Cause: The Organization allocates payroll to programs funded by awards based on the contract supported budget, which is based on an estimate of the time that work will be performed by individuals. At the time of the audit, the true-up of budgeted hours to actual hours worked had not been completed. Effect: Without time records, which are based on time worked to support the proper allocation of payroll, errors could occur and result in the Organization reporting and receiving reimbursement for the incorrect amount of payroll expenses. Identification of a Repeat Finding: This is not a repeat finding from a prior year audit. Questioned Costs: None reported. Recommendation: The Organization’s use of Personnel Activity Report (PAR) equivalent documentation, should allow each employee to accurately reflect the time work is performed, and serve as support for personnel expenses, funded by a federal award. Views of Responsible Officials and Planned Corrective Action Plan: The Organization agrees with the finding as indicated in the Organization’s corrective action plan, and has modified procedures to reflect actual time worked by employees on PAR equivalent documentation. This will serve as support for personnel expenses funded by a federal award.
2023-001. Allowable Costs/Cost Principles United States Department of Health and Human Services, Substance Abuse and Mental Health Services Administration: Substance Abuse and Mental Health Services Projects of Regional and National Significance Passed Through Vibrant Emotional Health: National Suicide Prevention Lifeline: 988 National Chat and Text Backup 93.243 S23-SM84816-048 988 National Backup Chat and Text Subnetwork 93.243 S24-SM84816-048-CTP 988 National Phone Backup 93.243 S23-SM84816-048 988 National Backup Phone Subnetwork 93.243 S24-SM84816-048-PB Disaster Distress Helpline: Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-048 Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-049 Disaster Distress Helpline Online Peer Support Center 93.243 S24-SM84816-048-DDH OPS Criteria: Uniform Guidance 2 CFR 200.430, covers standards for documentation of compensation-personal services. Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed and time spent. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, these records should support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and non-federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: Time records prepared by employees reflect the total hours worked for the day, but do not reflect the actual time spent on programs funded by a federal award, rather they are based on budgeted hours, and scheduled for true-up at a later date. Cause: The Organization allocates payroll to programs funded by awards based on the contract supported budget, which is based on an estimate of the time that work will be performed by individuals. At the time of the audit, the true-up of budgeted hours to actual hours worked had not been completed. Effect: Without time records, which are based on time worked to support the proper allocation of payroll, errors could occur and result in the Organization reporting and receiving reimbursement for the incorrect amount of payroll expenses. Identification of a Repeat Finding: This is not a repeat finding from a prior year audit. Questioned Costs: None reported. Recommendation: The Organization’s use of Personnel Activity Report (PAR) equivalent documentation, should allow each employee to accurately reflect the time work is performed, and serve as support for personnel expenses, funded by a federal award. Views of Responsible Officials and Planned Corrective Action Plan: The Organization agrees with the finding as indicated in the Organization’s corrective action plan, and has modified procedures to reflect actual time worked by employees on PAR equivalent documentation. This will serve as support for personnel expenses funded by a federal award.
2023-001. Allowable Costs/Cost Principles United States Department of Health and Human Services, Substance Abuse and Mental Health Services Administration: Substance Abuse and Mental Health Services Projects of Regional and National Significance Passed Through Vibrant Emotional Health: National Suicide Prevention Lifeline: 988 National Chat and Text Backup 93.243 S23-SM84816-048 988 National Backup Chat and Text Subnetwork 93.243 S24-SM84816-048-CTP 988 National Phone Backup 93.243 S23-SM84816-048 988 National Backup Phone Subnetwork 93.243 S24-SM84816-048-PB Disaster Distress Helpline: Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-048 Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-049 Disaster Distress Helpline Online Peer Support Center 93.243 S24-SM84816-048-DDH OPS Criteria: Uniform Guidance 2 CFR 200.430, covers standards for documentation of compensation-personal services. Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed and time spent. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, these records should support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and non-federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: Time records prepared by employees reflect the total hours worked for the day, but do not reflect the actual time spent on programs funded by a federal award, rather they are based on budgeted hours, and scheduled for true-up at a later date. Cause: The Organization allocates payroll to programs funded by awards based on the contract supported budget, which is based on an estimate of the time that work will be performed by individuals. At the time of the audit, the true-up of budgeted hours to actual hours worked had not been completed. Effect: Without time records, which are based on time worked to support the proper allocation of payroll, errors could occur and result in the Organization reporting and receiving reimbursement for the incorrect amount of payroll expenses. Identification of a Repeat Finding: This is not a repeat finding from a prior year audit. Questioned Costs: None reported. Recommendation: The Organization’s use of Personnel Activity Report (PAR) equivalent documentation, should allow each employee to accurately reflect the time work is performed, and serve as support for personnel expenses, funded by a federal award. Views of Responsible Officials and Planned Corrective Action Plan: The Organization agrees with the finding as indicated in the Organization’s corrective action plan, and has modified procedures to reflect actual time worked by employees on PAR equivalent documentation. This will serve as support for personnel expenses funded by a federal award.
2023-001. Allowable Costs/Cost Principles United States Department of Health and Human Services, Substance Abuse and Mental Health Services Administration: Substance Abuse and Mental Health Services Projects of Regional and National Significance Passed Through Vibrant Emotional Health: National Suicide Prevention Lifeline: 988 National Chat and Text Backup 93.243 S23-SM84816-048 988 National Backup Chat and Text Subnetwork 93.243 S24-SM84816-048-CTP 988 National Phone Backup 93.243 S23-SM84816-048 988 National Backup Phone Subnetwork 93.243 S24-SM84816-048-PB Disaster Distress Helpline: Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-048 Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-049 Disaster Distress Helpline Online Peer Support Center 93.243 S24-SM84816-048-DDH OPS Criteria: Uniform Guidance 2 CFR 200.430, covers standards for documentation of compensation-personal services. Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed and time spent. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, these records should support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and non-federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: Time records prepared by employees reflect the total hours worked for the day, but do not reflect the actual time spent on programs funded by a federal award, rather they are based on budgeted hours, and scheduled for true-up at a later date. Cause: The Organization allocates payroll to programs funded by awards based on the contract supported budget, which is based on an estimate of the time that work will be performed by individuals. At the time of the audit, the true-up of budgeted hours to actual hours worked had not been completed. Effect: Without time records, which are based on time worked to support the proper allocation of payroll, errors could occur and result in the Organization reporting and receiving reimbursement for the incorrect amount of payroll expenses. Identification of a Repeat Finding: This is not a repeat finding from a prior year audit. Questioned Costs: None reported. Recommendation: The Organization’s use of Personnel Activity Report (PAR) equivalent documentation, should allow each employee to accurately reflect the time work is performed, and serve as support for personnel expenses, funded by a federal award. Views of Responsible Officials and Planned Corrective Action Plan: The Organization agrees with the finding as indicated in the Organization’s corrective action plan, and has modified procedures to reflect actual time worked by employees on PAR equivalent documentation. This will serve as support for personnel expenses funded by a federal award.
2023-001. Allowable Costs/Cost Principles United States Department of Health and Human Services, Substance Abuse and Mental Health Services Administration: Substance Abuse and Mental Health Services Projects of Regional and National Significance Passed Through Vibrant Emotional Health: National Suicide Prevention Lifeline: 988 National Chat and Text Backup 93.243 S23-SM84816-048 988 National Backup Chat and Text Subnetwork 93.243 S24-SM84816-048-CTP 988 National Phone Backup 93.243 S23-SM84816-048 988 National Backup Phone Subnetwork 93.243 S24-SM84816-048-PB Disaster Distress Helpline: Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-048 Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-049 Disaster Distress Helpline Online Peer Support Center 93.243 S24-SM84816-048-DDH OPS Criteria: Uniform Guidance 2 CFR 200.430, covers standards for documentation of compensation-personal services. Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed and time spent. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, these records should support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and non-federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: Time records prepared by employees reflect the total hours worked for the day, but do not reflect the actual time spent on programs funded by a federal award, rather they are based on budgeted hours, and scheduled for true-up at a later date. Cause: The Organization allocates payroll to programs funded by awards based on the contract supported budget, which is based on an estimate of the time that work will be performed by individuals. At the time of the audit, the true-up of budgeted hours to actual hours worked had not been completed. Effect: Without time records, which are based on time worked to support the proper allocation of payroll, errors could occur and result in the Organization reporting and receiving reimbursement for the incorrect amount of payroll expenses. Identification of a Repeat Finding: This is not a repeat finding from a prior year audit. Questioned Costs: None reported. Recommendation: The Organization’s use of Personnel Activity Report (PAR) equivalent documentation, should allow each employee to accurately reflect the time work is performed, and serve as support for personnel expenses, funded by a federal award. Views of Responsible Officials and Planned Corrective Action Plan: The Organization agrees with the finding as indicated in the Organization’s corrective action plan, and has modified procedures to reflect actual time worked by employees on PAR equivalent documentation. This will serve as support for personnel expenses funded by a federal award.
2023-001. Allowable Costs/Cost Principles United States Department of Health and Human Services, Substance Abuse and Mental Health Services Administration: Substance Abuse and Mental Health Services Projects of Regional and National Significance Passed Through Vibrant Emotional Health: National Suicide Prevention Lifeline: 988 National Chat and Text Backup 93.243 S23-SM84816-048 988 National Backup Chat and Text Subnetwork 93.243 S24-SM84816-048-CTP 988 National Phone Backup 93.243 S23-SM84816-048 988 National Backup Phone Subnetwork 93.243 S24-SM84816-048-PB Disaster Distress Helpline: Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-048 Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-049 Disaster Distress Helpline Online Peer Support Center 93.243 S24-SM84816-048-DDH OPS Criteria: Uniform Guidance 2 CFR 200.430, covers standards for documentation of compensation-personal services. Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed and time spent. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, these records should support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and non-federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: Time records prepared by employees reflect the total hours worked for the day, but do not reflect the actual time spent on programs funded by a federal award, rather they are based on budgeted hours, and scheduled for true-up at a later date. Cause: The Organization allocates payroll to programs funded by awards based on the contract supported budget, which is based on an estimate of the time that work will be performed by individuals. At the time of the audit, the true-up of budgeted hours to actual hours worked had not been completed. Effect: Without time records, which are based on time worked to support the proper allocation of payroll, errors could occur and result in the Organization reporting and receiving reimbursement for the incorrect amount of payroll expenses. Identification of a Repeat Finding: This is not a repeat finding from a prior year audit. Questioned Costs: None reported. Recommendation: The Organization’s use of Personnel Activity Report (PAR) equivalent documentation, should allow each employee to accurately reflect the time work is performed, and serve as support for personnel expenses, funded by a federal award. Views of Responsible Officials and Planned Corrective Action Plan: The Organization agrees with the finding as indicated in the Organization’s corrective action plan, and has modified procedures to reflect actual time worked by employees on PAR equivalent documentation. This will serve as support for personnel expenses funded by a federal award.
2023-001. Allowable Costs/Cost Principles United States Department of Health and Human Services, Substance Abuse and Mental Health Services Administration: Substance Abuse and Mental Health Services Projects of Regional and National Significance Passed Through Vibrant Emotional Health: National Suicide Prevention Lifeline: 988 National Chat and Text Backup 93.243 S23-SM84816-048 988 National Backup Chat and Text Subnetwork 93.243 S24-SM84816-048-CTP 988 National Phone Backup 93.243 S23-SM84816-048 988 National Backup Phone Subnetwork 93.243 S24-SM84816-048-PB Disaster Distress Helpline: Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-048 Disaster Distress Helpline Online Peer Support Center 93.243 S23-SM84816-049 Disaster Distress Helpline Online Peer Support Center 93.243 S24-SM84816-048-DDH OPS Criteria: Uniform Guidance 2 CFR 200.430, covers standards for documentation of compensation-personal services. Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed and time spent. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, these records should support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and non-federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: Time records prepared by employees reflect the total hours worked for the day, but do not reflect the actual time spent on programs funded by a federal award, rather they are based on budgeted hours, and scheduled for true-up at a later date. Cause: The Organization allocates payroll to programs funded by awards based on the contract supported budget, which is based on an estimate of the time that work will be performed by individuals. At the time of the audit, the true-up of budgeted hours to actual hours worked had not been completed. Effect: Without time records, which are based on time worked to support the proper allocation of payroll, errors could occur and result in the Organization reporting and receiving reimbursement for the incorrect amount of payroll expenses. Identification of a Repeat Finding: This is not a repeat finding from a prior year audit. Questioned Costs: None reported. Recommendation: The Organization’s use of Personnel Activity Report (PAR) equivalent documentation, should allow each employee to accurately reflect the time work is performed, and serve as support for personnel expenses, funded by a federal award. Views of Responsible Officials and Planned Corrective Action Plan: The Organization agrees with the finding as indicated in the Organization’s corrective action plan, and has modified procedures to reflect actual time worked by employees on PAR equivalent documentation. This will serve as support for personnel expenses funded by a federal award.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.
Federal Award Allowable Activities and Cost Requirements Payroll Approval Federal Awarding Agency - Department of Health and Human Services Assistance Listing Number - 93.044, 93.045, 93.053, 93.052 Federal Awarding Agency - Department of Veteran Affairs Assistance Listing Number - 64.044 Questionned Costs - None Criteria: 2 CFR Part 200 in general and 2 CFR section 200.303(a) require non-Federal entities to establish and maintain effective internal controls over Federal awards, including the requirements for allowable costs and cost principles. 2 CFR section 200.430(i)(1) requires that charges to Federal awards or salaries and wages must be based on records that accurately reflect the work performed. The records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) And be incorporated into the official records of the non-Federal entity. Condition: We identified two pay periods in our testing where internal controls related to review of the payroll reports did not have evidence of all required approvals necessary to ensure compliance with allowable costs and cost principles before funds were disbursed or such approvals were not able to be located. Cause: Evidence of review over two payroll reports selected for testing were not able to be located due to transition in CFO position during the year. Effect: Allowable costs and cost principles compliance requirements may not be met due to lack of evidence of internal controls. Recommendation: We recommend that the review of all payroll reports be documented and maintained to ensure costs are allowable before they are disbursed.