Finding 2022-008 ? Allowable Costs/Cost PrinciplesIdentification of the federal program U.S. Department of DefenseU.S. Department of Health and Human ServicesResearch and Development ClusterAssistance Listing Nos.12.420, 93.103, 93.121, 93.279, 93.286, 93.310, 93.350, 93.361, 93,394, 93.396, 93.650, 93.837, 93.838, 93.847, 93.853, 93.855, 93.865, and 93.866See Schedule of Findings and Questioned Costs for chart/tableCriteria or specific requirement (including statutory, regulatory, or other citation) 2 CFR 200.303(a) requires that the 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 should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR Part 200 Section 200.430 (i) states ?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 both 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.?Condition St. Joseph?s Hospital and Medical Center used budgeted costs to determine the amount of expenses allocated to the grant and failed to reconcile these amounts to actual payroll costs at year-end. Additionally, certain payroll expenditures were not reviewed and approved.Cause Management did not review payroll expenditures to support allowable costs/cost principles nor did it reconcile budgeted costs to actual costs incurred for certain payroll expenses.Effect or potential effect Unallowable and inaccurate payroll expenditures could be charged to the federal program.Questioned costs None.Context We issued a material weakness related to internal controls in the prior year. Based upon the implementation date for the corrective action provided by management, the finding related to this internal control had not been remediated for the full period under audit. As such, we did not test the operating effectiveness of this control and are issuing a material weakness consistent with the prior year finding.Payroll expenditures of $4.1 million represent 33% of St. Joseph?s Hospital and Medical Center?s total research and development expenditures of $12.6 million, which represent 16% of total research and development cluster expenditures of $77.5 million.Identification as a repeat finding, if applicable This is a repeat finding for St. Joseph Hospital and Medical Center ? Finding 2021-009.Recommendation We recommend management implement a process to record time charged to federal grants in accordance with 2 CFR 200.430 and implement effective internal controls to review and approve payroll expenditures charged to the grant.Views of responsibleofficials Management agrees with the finding and implemented corrective action in September 2022.
Finding 2022-008 ? Allowable Costs/Cost PrinciplesIdentification of the federal program U.S. Department of DefenseU.S. Department of Health and Human ServicesResearch and Development ClusterAssistance Listing Nos.12.420, 93.103, 93.121, 93.279, 93.286, 93.310, 93.350, 93.361, 93,394, 93.396, 93.650, 93.837, 93.838, 93.847, 93.853, 93.855, 93.865, and 93.866See Schedule of Findings and Questioned Costs for chart/tableCriteria or specific requirement (including statutory, regulatory, or other citation) 2 CFR 200.303(a) requires that the 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 should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR Part 200 Section 200.430 (i) states ?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 both 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.?Condition St. Joseph?s Hospital and Medical Center used budgeted costs to determine the amount of expenses allocated to the grant and failed to reconcile these amounts to actual payroll costs at year-end. Additionally, certain payroll expenditures were not reviewed and approved.Cause Management did not review payroll expenditures to support allowable costs/cost principles nor did it reconcile budgeted costs to actual costs incurred for certain payroll expenses.Effect or potential effect Unallowable and inaccurate payroll expenditures could be charged to the federal program.Questioned costs None.Context We issued a material weakness related to internal controls in the prior year. Based upon the implementation date for the corrective action provided by management, the finding related to this internal control had not been remediated for the full period under audit. As such, we did not test the operating effectiveness of this control and are issuing a material weakness consistent with the prior year finding.Payroll expenditures of $4.1 million represent 33% of St. Joseph?s Hospital and Medical Center?s total research and development expenditures of $12.6 million, which represent 16% of total research and development cluster expenditures of $77.5 million.Identification as a repeat finding, if applicable This is a repeat finding for St. Joseph Hospital and Medical Center ? Finding 2021-009.Recommendation We recommend management implement a process to record time charged to federal grants in accordance with 2 CFR 200.430 and implement effective internal controls to review and approve payroll expenditures charged to the grant.Views of responsibleofficials Management agrees with the finding and implemented corrective action in September 2022.
Finding 2022-008 ? Allowable Costs/Cost PrinciplesIdentification of the federal program U.S. Department of DefenseU.S. Department of Health and Human ServicesResearch and Development ClusterAssistance Listing Nos.12.420, 93.103, 93.121, 93.279, 93.286, 93.310, 93.350, 93.361, 93,394, 93.396, 93.650, 93.837, 93.838, 93.847, 93.853, 93.855, 93.865, and 93.866See Schedule of Findings and Questioned Costs for chart/tableCriteria or specific requirement (including statutory, regulatory, or other citation) 2 CFR 200.303(a) requires that the 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 should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR Part 200 Section 200.430 (i) states ?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 both 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.?Condition St. Joseph?s Hospital and Medical Center used budgeted costs to determine the amount of expenses allocated to the grant and failed to reconcile these amounts to actual payroll costs at year-end. Additionally, certain payroll expenditures were not reviewed and approved.Cause Management did not review payroll expenditures to support allowable costs/cost principles nor did it reconcile budgeted costs to actual costs incurred for certain payroll expenses.Effect or potential effect Unallowable and inaccurate payroll expenditures could be charged to the federal program.Questioned costs None.Context We issued a material weakness related to internal controls in the prior year. Based upon the implementation date for the corrective action provided by management, the finding related to this internal control had not been remediated for the full period under audit. As such, we did not test the operating effectiveness of this control and are issuing a material weakness consistent with the prior year finding.Payroll expenditures of $4.1 million represent 33% of St. Joseph?s Hospital and Medical Center?s total research and development expenditures of $12.6 million, which represent 16% of total research and development cluster expenditures of $77.5 million.Identification as a repeat finding, if applicable This is a repeat finding for St. Joseph Hospital and Medical Center ? Finding 2021-009.Recommendation We recommend management implement a process to record time charged to federal grants in accordance with 2 CFR 200.430 and implement effective internal controls to review and approve payroll expenditures charged to the grant.Views of responsibleofficials Management agrees with the finding and implemented corrective action in September 2022.
Finding 2022-008 ? Allowable Costs/Cost PrinciplesIdentification of the federal program U.S. Department of DefenseU.S. Department of Health and Human ServicesResearch and Development ClusterAssistance Listing Nos.12.420, 93.103, 93.121, 93.279, 93.286, 93.310, 93.350, 93.361, 93,394, 93.396, 93.650, 93.837, 93.838, 93.847, 93.853, 93.855, 93.865, and 93.866See Schedule of Findings and Questioned Costs for chart/tableCriteria or specific requirement (including statutory, regulatory, or other citation) 2 CFR 200.303(a) requires that the 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 should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR Part 200 Section 200.430 (i) states ?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 both 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.?Condition St. Joseph?s Hospital and Medical Center used budgeted costs to determine the amount of expenses allocated to the grant and failed to reconcile these amounts to actual payroll costs at year-end. Additionally, certain payroll expenditures were not reviewed and approved.Cause Management did not review payroll expenditures to support allowable costs/cost principles nor did it reconcile budgeted costs to actual costs incurred for certain payroll expenses.Effect or potential effect Unallowable and inaccurate payroll expenditures could be charged to the federal program.Questioned costs None.Context We issued a material weakness related to internal controls in the prior year. Based upon the implementation date for the corrective action provided by management, the finding related to this internal control had not been remediated for the full period under audit. As such, we did not test the operating effectiveness of this control and are issuing a material weakness consistent with the prior year finding.Payroll expenditures of $4.1 million represent 33% of St. Joseph?s Hospital and Medical Center?s total research and development expenditures of $12.6 million, which represent 16% of total research and development cluster expenditures of $77.5 million.Identification as a repeat finding, if applicable This is a repeat finding for St. Joseph Hospital and Medical Center ? Finding 2021-009.Recommendation We recommend management implement a process to record time charged to federal grants in accordance with 2 CFR 200.430 and implement effective internal controls to review and approve payroll expenditures charged to the grant.Views of responsibleofficials Management agrees with the finding and implemented corrective action in September 2022.
Finding 2022-008 ? Allowable Costs/Cost PrinciplesIdentification of the federal program U.S. Department of DefenseU.S. Department of Health and Human ServicesResearch and Development ClusterAssistance Listing Nos.12.420, 93.103, 93.121, 93.279, 93.286, 93.310, 93.350, 93.361, 93,394, 93.396, 93.650, 93.837, 93.838, 93.847, 93.853, 93.855, 93.865, and 93.866See Schedule of Findings and Questioned Costs for chart/tableCriteria or specific requirement (including statutory, regulatory, or other citation) 2 CFR 200.303(a) requires that the 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 should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR Part 200 Section 200.430 (i) states ?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 both 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.?Condition St. Joseph?s Hospital and Medical Center used budgeted costs to determine the amount of expenses allocated to the grant and failed to reconcile these amounts to actual payroll costs at year-end. Additionally, certain payroll expenditures were not reviewed and approved.Cause Management did not review payroll expenditures to support allowable costs/cost principles nor did it reconcile budgeted costs to actual costs incurred for certain payroll expenses.Effect or potential effect Unallowable and inaccurate payroll expenditures could be charged to the federal program.Questioned costs None.Context We issued a material weakness related to internal controls in the prior year. Based upon the implementation date for the corrective action provided by management, the finding related to this internal control had not been remediated for the full period under audit. As such, we did not test the operating effectiveness of this control and are issuing a material weakness consistent with the prior year finding.Payroll expenditures of $4.1 million represent 33% of St. Joseph?s Hospital and Medical Center?s total research and development expenditures of $12.6 million, which represent 16% of total research and development cluster expenditures of $77.5 million.Identification as a repeat finding, if applicable This is a repeat finding for St. Joseph Hospital and Medical Center ? Finding 2021-009.Recommendation We recommend management implement a process to record time charged to federal grants in accordance with 2 CFR 200.430 and implement effective internal controls to review and approve payroll expenditures charged to the grant.Views of responsibleofficials Management agrees with the finding and implemented corrective action in September 2022.
Finding 2022-008 ? Allowable Costs/Cost PrinciplesIdentification of the federal program U.S. Department of DefenseU.S. Department of Health and Human ServicesResearch and Development ClusterAssistance Listing Nos.12.420, 93.103, 93.121, 93.279, 93.286, 93.310, 93.350, 93.361, 93,394, 93.396, 93.650, 93.837, 93.838, 93.847, 93.853, 93.855, 93.865, and 93.866See Schedule of Findings and Questioned Costs for chart/tableCriteria or specific requirement (including statutory, regulatory, or other citation) 2 CFR 200.303(a) requires that the 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 should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR Part 200 Section 200.430 (i) states ?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 both 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.?Condition St. Joseph?s Hospital and Medical Center used budgeted costs to determine the amount of expenses allocated to the grant and failed to reconcile these amounts to actual payroll costs at year-end. Additionally, certain payroll expenditures were not reviewed and approved.Cause Management did not review payroll expenditures to support allowable costs/cost principles nor did it reconcile budgeted costs to actual costs incurred for certain payroll expenses.Effect or potential effect Unallowable and inaccurate payroll expenditures could be charged to the federal program.Questioned costs None.Context We issued a material weakness related to internal controls in the prior year. Based upon the implementation date for the corrective action provided by management, the finding related to this internal control had not been remediated for the full period under audit. As such, we did not test the operating effectiveness of this control and are issuing a material weakness consistent with the prior year finding.Payroll expenditures of $4.1 million represent 33% of St. Joseph?s Hospital and Medical Center?s total research and development expenditures of $12.6 million, which represent 16% of total research and development cluster expenditures of $77.5 million.Identification as a repeat finding, if applicable This is a repeat finding for St. Joseph Hospital and Medical Center ? Finding 2021-009.Recommendation We recommend management implement a process to record time charged to federal grants in accordance with 2 CFR 200.430 and implement effective internal controls to review and approve payroll expenditures charged to the grant.Views of responsibleofficials Management agrees with the finding and implemented corrective action in September 2022.
Finding 2022-008 ? Allowable Costs/Cost PrinciplesIdentification of the federal program U.S. Department of DefenseU.S. Department of Health and Human ServicesResearch and Development ClusterAssistance Listing Nos.12.420, 93.103, 93.121, 93.279, 93.286, 93.310, 93.350, 93.361, 93,394, 93.396, 93.650, 93.837, 93.838, 93.847, 93.853, 93.855, 93.865, and 93.866See Schedule of Findings and Questioned Costs for chart/tableCriteria or specific requirement (including statutory, regulatory, or other citation) 2 CFR 200.303(a) requires that the 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 should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR Part 200 Section 200.430 (i) states ?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 both 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.?Condition St. Joseph?s Hospital and Medical Center used budgeted costs to determine the amount of expenses allocated to the grant and failed to reconcile these amounts to actual payroll costs at year-end. Additionally, certain payroll expenditures were not reviewed and approved.Cause Management did not review payroll expenditures to support allowable costs/cost principles nor did it reconcile budgeted costs to actual costs incurred for certain payroll expenses.Effect or potential effect Unallowable and inaccurate payroll expenditures could be charged to the federal program.Questioned costs None.Context We issued a material weakness related to internal controls in the prior year. Based upon the implementation date for the corrective action provided by management, the finding related to this internal control had not been remediated for the full period under audit. As such, we did not test the operating effectiveness of this control and are issuing a material weakness consistent with the prior year finding.Payroll expenditures of $4.1 million represent 33% of St. Joseph?s Hospital and Medical Center?s total research and development expenditures of $12.6 million, which represent 16% of total research and development cluster expenditures of $77.5 million.Identification as a repeat finding, if applicable This is a repeat finding for St. Joseph Hospital and Medical Center ? Finding 2021-009.Recommendation We recommend management implement a process to record time charged to federal grants in accordance with 2 CFR 200.430 and implement effective internal controls to review and approve payroll expenditures charged to the grant.Views of responsibleofficials Management agrees with the finding and implemented corrective action in September 2022.
Finding 2022-008 ? Allowable Costs/Cost PrinciplesIdentification of the federal program U.S. Department of DefenseU.S. Department of Health and Human ServicesResearch and Development ClusterAssistance Listing Nos.12.420, 93.103, 93.121, 93.279, 93.286, 93.310, 93.350, 93.361, 93,394, 93.396, 93.650, 93.837, 93.838, 93.847, 93.853, 93.855, 93.865, and 93.866See Schedule of Findings and Questioned Costs for chart/tableCriteria or specific requirement (including statutory, regulatory, or other citation) 2 CFR 200.303(a) requires that the 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 should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR Part 200 Section 200.430 (i) states ?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 both 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.?Condition St. Joseph?s Hospital and Medical Center used budgeted costs to determine the amount of expenses allocated to the grant and failed to reconcile these amounts to actual payroll costs at year-end. Additionally, certain payroll expenditures were not reviewed and approved.Cause Management did not review payroll expenditures to support allowable costs/cost principles nor did it reconcile budgeted costs to actual costs incurred for certain payroll expenses.Effect or potential effect Unallowable and inaccurate payroll expenditures could be charged to the federal program.Questioned costs None.Context We issued a material weakness related to internal controls in the prior year. Based upon the implementation date for the corrective action provided by management, the finding related to this internal control had not been remediated for the full period under audit. As such, we did not test the operating effectiveness of this control and are issuing a material weakness consistent with the prior year finding.Payroll expenditures of $4.1 million represent 33% of St. Joseph?s Hospital and Medical Center?s total research and development expenditures of $12.6 million, which represent 16% of total research and development cluster expenditures of $77.5 million.Identification as a repeat finding, if applicable This is a repeat finding for St. Joseph Hospital and Medical Center ? Finding 2021-009.Recommendation We recommend management implement a process to record time charged to federal grants in accordance with 2 CFR 200.430 and implement effective internal controls to review and approve payroll expenditures charged to the grant.Views of responsibleofficials Management agrees with the finding and implemented corrective action in September 2022.
Finding 2022-008 ? Allowable Costs/Cost PrinciplesIdentification of the federal program U.S. Department of DefenseU.S. Department of Health and Human ServicesResearch and Development ClusterAssistance Listing Nos.12.420, 93.103, 93.121, 93.279, 93.286, 93.310, 93.350, 93.361, 93,394, 93.396, 93.650, 93.837, 93.838, 93.847, 93.853, 93.855, 93.865, and 93.866See Schedule of Findings and Questioned Costs for chart/tableCriteria or specific requirement (including statutory, regulatory, or other citation) 2 CFR 200.303(a) requires that the 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 should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR Part 200 Section 200.430 (i) states ?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 both 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.?Condition St. Joseph?s Hospital and Medical Center used budgeted costs to determine the amount of expenses allocated to the grant and failed to reconcile these amounts to actual payroll costs at year-end. Additionally, certain payroll expenditures were not reviewed and approved.Cause Management did not review payroll expenditures to support allowable costs/cost principles nor did it reconcile budgeted costs to actual costs incurred for certain payroll expenses.Effect or potential effect Unallowable and inaccurate payroll expenditures could be charged to the federal program.Questioned costs None.Context We issued a material weakness related to internal controls in the prior year. Based upon the implementation date for the corrective action provided by management, the finding related to this internal control had not been remediated for the full period under audit. As such, we did not test the operating effectiveness of this control and are issuing a material weakness consistent with the prior year finding.Payroll expenditures of $4.1 million represent 33% of St. Joseph?s Hospital and Medical Center?s total research and development expenditures of $12.6 million, which represent 16% of total research and development cluster expenditures of $77.5 million.Identification as a repeat finding, if applicable This is a repeat finding for St. Joseph Hospital and Medical Center ? Finding 2021-009.Recommendation We recommend management implement a process to record time charged to federal grants in accordance with 2 CFR 200.430 and implement effective internal controls to review and approve payroll expenditures charged to the grant.Views of responsibleofficials Management agrees with the finding and implemented corrective action in September 2022.
Finding 2022-008 ? Allowable Costs/Cost PrinciplesIdentification of the federal program U.S. Department of DefenseU.S. Department of Health and Human ServicesResearch and Development ClusterAssistance Listing Nos.12.420, 93.103, 93.121, 93.279, 93.286, 93.310, 93.350, 93.361, 93,394, 93.396, 93.650, 93.837, 93.838, 93.847, 93.853, 93.855, 93.865, and 93.866See Schedule of Findings and Questioned Costs for chart/tableCriteria or specific requirement (including statutory, regulatory, or other citation) 2 CFR 200.303(a) requires that the 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 should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR Part 200 Section 200.430 (i) states ?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 both 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.?Condition St. Joseph?s Hospital and Medical Center used budgeted costs to determine the amount of expenses allocated to the grant and failed to reconcile these amounts to actual payroll costs at year-end. Additionally, certain payroll expenditures were not reviewed and approved.Cause Management did not review payroll expenditures to support allowable costs/cost principles nor did it reconcile budgeted costs to actual costs incurred for certain payroll expenses.Effect or potential effect Unallowable and inaccurate payroll expenditures could be charged to the federal program.Questioned costs None.Context We issued a material weakness related to internal controls in the prior year. Based upon the implementation date for the corrective action provided by management, the finding related to this internal control had not been remediated for the full period under audit. As such, we did not test the operating effectiveness of this control and are issuing a material weakness consistent with the prior year finding.Payroll expenditures of $4.1 million represent 33% of St. Joseph?s Hospital and Medical Center?s total research and development expenditures of $12.6 million, which represent 16% of total research and development cluster expenditures of $77.5 million.Identification as a repeat finding, if applicable This is a repeat finding for St. Joseph Hospital and Medical Center ? Finding 2021-009.Recommendation We recommend management implement a process to record time charged to federal grants in accordance with 2 CFR 200.430 and implement effective internal controls to review and approve payroll expenditures charged to the grant.Views of responsibleofficials Management agrees with the finding and implemented corrective action in September 2022.
Finding 2022-008 ? Allowable Costs/Cost PrinciplesIdentification of the federal program U.S. Department of DefenseU.S. Department of Health and Human ServicesResearch and Development ClusterAssistance Listing Nos.12.420, 93.103, 93.121, 93.279, 93.286, 93.310, 93.350, 93.361, 93,394, 93.396, 93.650, 93.837, 93.838, 93.847, 93.853, 93.855, 93.865, and 93.866See Schedule of Findings and Questioned Costs for chart/tableCriteria or specific requirement (including statutory, regulatory, or other citation) 2 CFR 200.303(a) requires that the 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 should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR Part 200 Section 200.430 (i) states ?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 both 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.?Condition St. Joseph?s Hospital and Medical Center used budgeted costs to determine the amount of expenses allocated to the grant and failed to reconcile these amounts to actual payroll costs at year-end. Additionally, certain payroll expenditures were not reviewed and approved.Cause Management did not review payroll expenditures to support allowable costs/cost principles nor did it reconcile budgeted costs to actual costs incurred for certain payroll expenses.Effect or potential effect Unallowable and inaccurate payroll expenditures could be charged to the federal program.Questioned costs None.Context We issued a material weakness related to internal controls in the prior year. Based upon the implementation date for the corrective action provided by management, the finding related to this internal control had not been remediated for the full period under audit. As such, we did not test the operating effectiveness of this control and are issuing a material weakness consistent with the prior year finding.Payroll expenditures of $4.1 million represent 33% of St. Joseph?s Hospital and Medical Center?s total research and development expenditures of $12.6 million, which represent 16% of total research and development cluster expenditures of $77.5 million.Identification as a repeat finding, if applicable This is a repeat finding for St. Joseph Hospital and Medical Center ? Finding 2021-009.Recommendation We recommend management implement a process to record time charged to federal grants in accordance with 2 CFR 200.430 and implement effective internal controls to review and approve payroll expenditures charged to the grant.Views of responsibleofficials Management agrees with the finding and implemented corrective action in September 2022.
Finding 2022-008 ? Allowable Costs/Cost PrinciplesIdentification of the federal program U.S. Department of DefenseU.S. Department of Health and Human ServicesResearch and Development ClusterAssistance Listing Nos.12.420, 93.103, 93.121, 93.279, 93.286, 93.310, 93.350, 93.361, 93,394, 93.396, 93.650, 93.837, 93.838, 93.847, 93.853, 93.855, 93.865, and 93.866See Schedule of Findings and Questioned Costs for chart/tableCriteria or specific requirement (including statutory, regulatory, or other citation) 2 CFR 200.303(a) requires that the 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 should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR Part 200 Section 200.430 (i) states ?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 both 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.?Condition St. Joseph?s Hospital and Medical Center used budgeted costs to determine the amount of expenses allocated to the grant and failed to reconcile these amounts to actual payroll costs at year-end. Additionally, certain payroll expenditures were not reviewed and approved.Cause Management did not review payroll expenditures to support allowable costs/cost principles nor did it reconcile budgeted costs to actual costs incurred for certain payroll expenses.Effect or potential effect Unallowable and inaccurate payroll expenditures could be charged to the federal program.Questioned costs None.Context We issued a material weakness related to internal controls in the prior year. Based upon the implementation date for the corrective action provided by management, the finding related to this internal control had not been remediated for the full period under audit. As such, we did not test the operating effectiveness of this control and are issuing a material weakness consistent with the prior year finding.Payroll expenditures of $4.1 million represent 33% of St. Joseph?s Hospital and Medical Center?s total research and development expenditures of $12.6 million, which represent 16% of total research and development cluster expenditures of $77.5 million.Identification as a repeat finding, if applicable This is a repeat finding for St. Joseph Hospital and Medical Center ? Finding 2021-009.Recommendation We recommend management implement a process to record time charged to federal grants in accordance with 2 CFR 200.430 and implement effective internal controls to review and approve payroll expenditures charged to the grant.Views of responsibleofficials Management agrees with the finding and implemented corrective action in September 2022.
Finding 2022-008 ? Allowable Costs/Cost PrinciplesIdentification of the federal program U.S. Department of DefenseU.S. Department of Health and Human ServicesResearch and Development ClusterAssistance Listing Nos.12.420, 93.103, 93.121, 93.279, 93.286, 93.310, 93.350, 93.361, 93,394, 93.396, 93.650, 93.837, 93.838, 93.847, 93.853, 93.855, 93.865, and 93.866See Schedule of Findings and Questioned Costs for chart/tableCriteria or specific requirement (including statutory, regulatory, or other citation) 2 CFR 200.303(a) requires that the 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 should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR Part 200 Section 200.430 (i) states ?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 both 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.?Condition St. Joseph?s Hospital and Medical Center used budgeted costs to determine the amount of expenses allocated to the grant and failed to reconcile these amounts to actual payroll costs at year-end. Additionally, certain payroll expenditures were not reviewed and approved.Cause Management did not review payroll expenditures to support allowable costs/cost principles nor did it reconcile budgeted costs to actual costs incurred for certain payroll expenses.Effect or potential effect Unallowable and inaccurate payroll expenditures could be charged to the federal program.Questioned costs None.Context We issued a material weakness related to internal controls in the prior year. Based upon the implementation date for the corrective action provided by management, the finding related to this internal control had not been remediated for the full period under audit. As such, we did not test the operating effectiveness of this control and are issuing a material weakness consistent with the prior year finding.Payroll expenditures of $4.1 million represent 33% of St. Joseph?s Hospital and Medical Center?s total research and development expenditures of $12.6 million, which represent 16% of total research and development cluster expenditures of $77.5 million.Identification as a repeat finding, if applicable This is a repeat finding for St. Joseph Hospital and Medical Center ? Finding 2021-009.Recommendation We recommend management implement a process to record time charged to federal grants in accordance with 2 CFR 200.430 and implement effective internal controls to review and approve payroll expenditures charged to the grant.Views of responsibleofficials Management agrees with the finding and implemented corrective action in September 2022.
Finding 2022-008 ? Allowable Costs/Cost PrinciplesIdentification of the federal program U.S. Department of DefenseU.S. Department of Health and Human ServicesResearch and Development ClusterAssistance Listing Nos.12.420, 93.103, 93.121, 93.279, 93.286, 93.310, 93.350, 93.361, 93,394, 93.396, 93.650, 93.837, 93.838, 93.847, 93.853, 93.855, 93.865, and 93.866See Schedule of Findings and Questioned Costs for chart/tableCriteria or specific requirement (including statutory, regulatory, or other citation) 2 CFR 200.303(a) requires that the 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 should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR Part 200 Section 200.430 (i) states ?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 both 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.?Condition St. Joseph?s Hospital and Medical Center used budgeted costs to determine the amount of expenses allocated to the grant and failed to reconcile these amounts to actual payroll costs at year-end. Additionally, certain payroll expenditures were not reviewed and approved.Cause Management did not review payroll expenditures to support allowable costs/cost principles nor did it reconcile budgeted costs to actual costs incurred for certain payroll expenses.Effect or potential effect Unallowable and inaccurate payroll expenditures could be charged to the federal program.Questioned costs None.Context We issued a material weakness related to internal controls in the prior year. Based upon the implementation date for the corrective action provided by management, the finding related to this internal control had not been remediated for the full period under audit. As such, we did not test the operating effectiveness of this control and are issuing a material weakness consistent with the prior year finding.Payroll expenditures of $4.1 million represent 33% of St. Joseph?s Hospital and Medical Center?s total research and development expenditures of $12.6 million, which represent 16% of total research and development cluster expenditures of $77.5 million.Identification as a repeat finding, if applicable This is a repeat finding for St. Joseph Hospital and Medical Center ? Finding 2021-009.Recommendation We recommend management implement a process to record time charged to federal grants in accordance with 2 CFR 200.430 and implement effective internal controls to review and approve payroll expenditures charged to the grant.Views of responsibleofficials Management agrees with the finding and implemented corrective action in September 2022.
Finding 2022-007 ? Allowable Costs/Cost PrinciplesIdentification of the federal program Health Resources and Services AdministrationHIV Emergency Relief Project GrantsAssistance Listing No. 93.914See Schedule of Findings and Questioned Costs for chart/tableSt. Mary?s Medical Center ? San FranciscoVirginia MasonCriteria or specific requirement (including statutory, regulatory, orother citation) 2 CFR 200.303(a) requires that the 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 should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR 200.430 (i) states ?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 both federally assisted and all other activities compensated by theSection III ? Federal Award Findings and Questioned Costs (continued)Finding 2022-007 ? Allowable Costs/Cost Principles (continued)Criteria or specific requirement (including statutory, regulatory, orother citation) (continued) 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.?Condition At St. Mary?s Medical Center ? San Francisco and Virginia Mason, controls over the required allowability criteria with regard to payroll expense were not performed and/or documented throughout the year.Cause St. Mary?s Medical Center ? San Francisco and Virginia Mason did not perform the necessary procedures addressing the requirements of 2 CFR 200.303(a) and 2 CFR 200.430.Effect or potential effect Unallowable and/or inaccurate payroll expenditures could becharged to the federal program.Questioned costs None.Context We issued a material weakness related to internal controls in the prior year. Based upon the implementation date for the corrective action provided by management, the finding related to this internal control had not been remediated for the full period under audit. As such, we did not test the operating effectiveness of this control and are issuing a material weakness consistent with the prior year finding.St. Mary?s Medical Center ? San Francisco expenditures of approximately $0.2 million represent 6% of total HIV Emergency Relief Project Grants expenditures of approximately $3.6 million.Virginia Mason expenditures of approximately $1.2 million represent 35% of total HIV Emergency Relief Project Grants expenditures of approximately $3.6 million.Identification as a repeat finding, if applicable This is a repeat finding for St. Mary?s Medical Center ? San Francisco ? Finding 2020-006 and 2021-008.This is a repeat finding for Virginia Mason ? Finding 2021-008.Recommendation We recommend management execute its processes toproperly approve time charged to federal grants in accordance with 2 CFR 200.430. Additionally, we recommend management execute and retain evidence of its internal controls over the allowability of payroll expenditures.Views of responsibleofficials Management agrees with the finding and implemented corrective action in April 2022.
Finding 2022-007 ? Allowable Costs/Cost PrinciplesIdentification of the federal program Health Resources and Services AdministrationHIV Emergency Relief Project GrantsAssistance Listing No. 93.914See Schedule of Findings and Questioned Costs for chart/tableSt. Mary?s Medical Center ? San FranciscoVirginia MasonCriteria or specific requirement (including statutory, regulatory, orother citation) 2 CFR 200.303(a) requires that the 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 should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).?2 CFR 200.430 (i) states ?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 both federally assisted and all other activities compensated by theSection III ? Federal Award Findings and Questioned Costs (continued)Finding 2022-007 ? Allowable Costs/Cost Principles (continued)Criteria or specific requirement (including statutory, regulatory, orother citation) (continued) 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.?Condition At St. Mary?s Medical Center ? San Francisco and Virginia Mason, controls over the required allowability criteria with regard to payroll expense were not performed and/or documented throughout the year.Cause St. Mary?s Medical Center ? San Francisco and Virginia Mason did not perform the necessary procedures addressing the requirements of 2 CFR 200.303(a) and 2 CFR 200.430.Effect or potential effect Unallowable and/or inaccurate payroll expenditures could becharged to the federal program.Questioned costs None.Context We issued a material weakness related to internal controls in the prior year. Based upon the implementation date for the corrective action provided by management, the finding related to this internal control had not been remediated for the full period under audit. As such, we did not test the operating effectiveness of this control and are issuing a material weakness consistent with the prior year finding.St. Mary?s Medical Center ? San Francisco expenditures of approximately $0.2 million represent 6% of total HIV Emergency Relief Project Grants expenditures of approximately $3.6 million.Virginia Mason expenditures of approximately $1.2 million represent 35% of total HIV Emergency Relief Project Grants expenditures of approximately $3.6 million.Identification as a repeat finding, if applicable This is a repeat finding for St. Mary?s Medical Center ? San Francisco ? Finding 2020-006 and 2021-008.This is a repeat finding for Virginia Mason ? Finding 2021-008.Recommendation We recommend management execute its processes toproperly approve time charged to federal grants in accordance with 2 CFR 200.430. Additionally, we recommend management execute and retain evidence of its internal controls over the allowability of payroll expenditures.Views of responsibleofficials Management agrees with the finding and implemented corrective action in April 2022.
2022-004 - Inadequate Controls over PayrollAward Year: 2022Award Numbers: 6LA700503, NU50CK000532, NU62PS924522, NU62PS924620, NU90TP922016Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesRepeat Finding: Yes (Prior Year Finding No. 2021-005)See Schedule of Findings and Questioned Costs for chart/tableCondition:The Louisiana Department of Health, Office of Public Health (OPH) did not ensure payroll expenditures were timely certified and approved for the WIC Special Supplemental Nutrition Program for Women, Infants, and Children; the Public Health Emergency Preparedness program; the Epidemiology and Laboratory Capacity for Infectious Diseases program; and the HIV Prevention Activities Health Department Based program. This is the third consecutive year payroll internal control deficiencies have been reported for Public Health Emergency Preparedness program and HIV Prevention Activities Health Department Based program, and the second consecutive year for WIC Special Supplemental Nutrition Program for Women, Infants, and Children and Epidemiology and Laboratory Capacity for Infectious Diseases program. Exceptions for each federal program are as follows:? For the WIC Special Supplemental Nutrition Program for Women, Infants, and Children, a non-statistical sample of 60 payroll transactions was tested from a population of 6,184 transactions totaling $8,970,425. Five (8%) time statements were not timely approved by the employees? supervisor, of which two (3%) were not approved at all, and two (3%) were not certified timely by the employees ranging from 13 to 236 days after the posting date.? For the Public Health Emergency Preparedness program, a non-statistical sample of 60 payroll transactions was tested from a population of 1,394 transactions totaling $3,988,398. Twenty-one (35%) time statements were not timely approved by the employees? supervisors, of which 12 (20%) were approved ranging from 23 days to 447 days after posting date and seven (12%) were not approved at all; two (3%) were not certified by the employees; and two (3%) were approved before certified.? For the Epidemiology and Laboratory Capacity for Infectious Diseases program, a non-statistical sample of 60 payroll transactions was tested from a population of 3,933 transactions totaling $5,190,684. Nine (15%) time statements were not timely approved by the employees? supervisors, of which four (7%) were not approved at all; one (2%) was not certified by the employee; and one (2%) was approved before certified.? For the HIV Prevention Activities Health Department Based program, a non-statistical sample of 60 payroll transactions was tested from a population of 1,024 transactions totaling $386,769. Nine (15%) time statements were not timely approved by the employees? supervisors, of which one (2%) was not approved at all; seven (12%) were approved ranging from one day to 351 days after the posting date; and one (2%) was not certified by the employee.Criteria:2 CFR 200.430(i) requires that records must be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, the records must comply with the established accounting policies and practices of the non-federal entity.The Division of Administration Personnel Policy No. 99 requires employees and supervisors to certify and/or approve time statements for accuracy by 10:00 p.m. on the Wednesday following the close of the pay period. Time administrators are responsible for reviewing the LaGov ZP241 eCertification report prior to processing to identify any employees who have not certified their time statements and any supervisors who have not approved their staff?s time statements.Cause:OPH lacked sufficient controls to ensure electronic time statements were properly certified and approved prior to the posting date in accordance with federal and state regulations.Effect:Failure to adequately approve program expenditures increases the risk that unallowable costs could be reimbursed by the federal grantor.Recommendation:OPH should ensure employees comply with existing policies and procedures, including certifying and approving electronic time statements in a timely manner.Management?s Response and Corrective Action Plan:Management concurred with the finding and provided a corrective action plan (B-43).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-006 - Control Weakness and Noncompliance with Personnel Expenses Charged to Federal AwardsAward Years: 2018, 2019, 2021, 2022Award Numbers: 2138930, 2000614536, B-18-DP-22-001, EMW-2020-SS-00011-S01, M19AC00015, NR227217XXXXC002, P01AI048240, R21AI165939, R33HD099745, U19AI159840Compliance Requirements: Allowable Costs/Cost Principles, Special Tests and ProvisionsPass-Through Entities: Board of Trustees of the Leland Stanford Junior University, Emory UniversityRepeat Finding: Yes (Prior Year Finding No. 2021-009)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the second consecutive year, the University of Louisiana at Lafayette (UL Lafayette) did not have adequate controls in place to ensure personnel expenses and effort charged to federal R&D awards accurately reflected work performed. From a population of 28,744 payroll and non-payroll expenses charged to R&D grants, a non-statistical sample of 25 transactions was tested. For all 12 (48%) of the payroll transactions, UL Lafayette was unable to provide documentation to show that personnel-related expenses, totaling $4,520, were supported by time and effort certifications to ensure the accuracy of budget estimates charged to federal awards as required by federal regulations. Additionally, because there is no after-the-fact review to ensure the accuracy of personnel costs and effort charged to the awards, UL Lafayette could not ensure compliance with the requirements of special tests and provisions related to key personnel effort.Criteria:2 CFR 200.430(i) specifies the documentation standards for personnel expenses. In order to be allowable, charges to federal awards for personnel expenses must be based on records that accurately reflect the work performed and must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Budget estimates alone do not qualify as support for charges to federal awards, but can be used for interim accounting purposes provided that internal controls include an after-the-fact review to confirm the accuracy of final amounts charged to federal awards.Prior approval requirements related to key personnel effort are contained in 2 CFR 200.308(c) and within grant terms and conditions. A reduction of 25% or greater in time devoted to the project from key personnel requires prior approval.Cause:Management represented that it?s still in the process of implementing the prior-year corrective actions to address the issues noted in the prior-year finding. As a result, time and effort certifications were not completed by employees to support the accuracy of budget estimates charged to federal awards as required by 2 CFR 200.430(i).Effect:Inadequate controls related to federal documentation standards for personnel expenses could result in noncompliance with federal allowable costs and cost principles, as well as noncompliance with special tests and provisions related to key personnel effort.Recommendation:Management should strengthen internal controls to ensure that personnel expenses charged to the federal awards are supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated.Management?s Response and Corrective Action Plan:Management did not concur with the finding, noting it did not have sufficient time in fiscal year 2022 for corrective action and provided its progress on addressing the finding (B-82).
2022-006 - Control Weakness and Noncompliance with Personnel Expenses Charged to Federal AwardsAward Years: 2018, 2019, 2021, 2022Award Numbers: 2138930, 2000614536, B-18-DP-22-001, EMW-2020-SS-00011-S01, M19AC00015, NR227217XXXXC002, P01AI048240, R21AI165939, R33HD099745, U19AI159840Compliance Requirements: Allowable Costs/Cost Principles, Special Tests and ProvisionsPass-Through Entities: Board of Trustees of the Leland Stanford Junior University, Emory UniversityRepeat Finding: Yes (Prior Year Finding No. 2021-009)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the second consecutive year, the University of Louisiana at Lafayette (UL Lafayette) did not have adequate controls in place to ensure personnel expenses and effort charged to federal R&D awards accurately reflected work performed. From a population of 28,744 payroll and non-payroll expenses charged to R&D grants, a non-statistical sample of 25 transactions was tested. For all 12 (48%) of the payroll transactions, UL Lafayette was unable to provide documentation to show that personnel-related expenses, totaling $4,520, were supported by time and effort certifications to ensure the accuracy of budget estimates charged to federal awards as required by federal regulations. Additionally, because there is no after-the-fact review to ensure the accuracy of personnel costs and effort charged to the awards, UL Lafayette could not ensure compliance with the requirements of special tests and provisions related to key personnel effort.Criteria:2 CFR 200.430(i) specifies the documentation standards for personnel expenses. In order to be allowable, charges to federal awards for personnel expenses must be based on records that accurately reflect the work performed and must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Budget estimates alone do not qualify as support for charges to federal awards, but can be used for interim accounting purposes provided that internal controls include an after-the-fact review to confirm the accuracy of final amounts charged to federal awards.Prior approval requirements related to key personnel effort are contained in 2 CFR 200.308(c) and within grant terms and conditions. A reduction of 25% or greater in time devoted to the project from key personnel requires prior approval.Cause:Management represented that it?s still in the process of implementing the prior-year corrective actions to address the issues noted in the prior-year finding. As a result, time and effort certifications were not completed by employees to support the accuracy of budget estimates charged to federal awards as required by 2 CFR 200.430(i).Effect:Inadequate controls related to federal documentation standards for personnel expenses could result in noncompliance with federal allowable costs and cost principles, as well as noncompliance with special tests and provisions related to key personnel effort.Recommendation:Management should strengthen internal controls to ensure that personnel expenses charged to the federal awards are supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated.Management?s Response and Corrective Action Plan:Management did not concur with the finding, noting it did not have sufficient time in fiscal year 2022 for corrective action and provided its progress on addressing the finding (B-82).
2022-006 - Control Weakness and Noncompliance with Personnel Expenses Charged to Federal AwardsAward Years: 2018, 2019, 2021, 2022Award Numbers: 2138930, 2000614536, B-18-DP-22-001, EMW-2020-SS-00011-S01, M19AC00015, NR227217XXXXC002, P01AI048240, R21AI165939, R33HD099745, U19AI159840Compliance Requirements: Allowable Costs/Cost Principles, Special Tests and ProvisionsPass-Through Entities: Board of Trustees of the Leland Stanford Junior University, Emory UniversityRepeat Finding: Yes (Prior Year Finding No. 2021-009)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the second consecutive year, the University of Louisiana at Lafayette (UL Lafayette) did not have adequate controls in place to ensure personnel expenses and effort charged to federal R&D awards accurately reflected work performed. From a population of 28,744 payroll and non-payroll expenses charged to R&D grants, a non-statistical sample of 25 transactions was tested. For all 12 (48%) of the payroll transactions, UL Lafayette was unable to provide documentation to show that personnel-related expenses, totaling $4,520, were supported by time and effort certifications to ensure the accuracy of budget estimates charged to federal awards as required by federal regulations. Additionally, because there is no after-the-fact review to ensure the accuracy of personnel costs and effort charged to the awards, UL Lafayette could not ensure compliance with the requirements of special tests and provisions related to key personnel effort.Criteria:2 CFR 200.430(i) specifies the documentation standards for personnel expenses. In order to be allowable, charges to federal awards for personnel expenses must be based on records that accurately reflect the work performed and must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Budget estimates alone do not qualify as support for charges to federal awards, but can be used for interim accounting purposes provided that internal controls include an after-the-fact review to confirm the accuracy of final amounts charged to federal awards.Prior approval requirements related to key personnel effort are contained in 2 CFR 200.308(c) and within grant terms and conditions. A reduction of 25% or greater in time devoted to the project from key personnel requires prior approval.Cause:Management represented that it?s still in the process of implementing the prior-year corrective actions to address the issues noted in the prior-year finding. As a result, time and effort certifications were not completed by employees to support the accuracy of budget estimates charged to federal awards as required by 2 CFR 200.430(i).Effect:Inadequate controls related to federal documentation standards for personnel expenses could result in noncompliance with federal allowable costs and cost principles, as well as noncompliance with special tests and provisions related to key personnel effort.Recommendation:Management should strengthen internal controls to ensure that personnel expenses charged to the federal awards are supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated.Management?s Response and Corrective Action Plan:Management did not concur with the finding, noting it did not have sufficient time in fiscal year 2022 for corrective action and provided its progress on addressing the finding (B-82).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-006 - Control Weakness and Noncompliance with Personnel Expenses Charged to Federal AwardsAward Years: 2018, 2019, 2021, 2022Award Numbers: 2138930, 2000614536, B-18-DP-22-001, EMW-2020-SS-00011-S01, M19AC00015, NR227217XXXXC002, P01AI048240, R21AI165939, R33HD099745, U19AI159840Compliance Requirements: Allowable Costs/Cost Principles, Special Tests and ProvisionsPass-Through Entities: Board of Trustees of the Leland Stanford Junior University, Emory UniversityRepeat Finding: Yes (Prior Year Finding No. 2021-009)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the second consecutive year, the University of Louisiana at Lafayette (UL Lafayette) did not have adequate controls in place to ensure personnel expenses and effort charged to federal R&D awards accurately reflected work performed. From a population of 28,744 payroll and non-payroll expenses charged to R&D grants, a non-statistical sample of 25 transactions was tested. For all 12 (48%) of the payroll transactions, UL Lafayette was unable to provide documentation to show that personnel-related expenses, totaling $4,520, were supported by time and effort certifications to ensure the accuracy of budget estimates charged to federal awards as required by federal regulations. Additionally, because there is no after-the-fact review to ensure the accuracy of personnel costs and effort charged to the awards, UL Lafayette could not ensure compliance with the requirements of special tests and provisions related to key personnel effort.Criteria:2 CFR 200.430(i) specifies the documentation standards for personnel expenses. In order to be allowable, charges to federal awards for personnel expenses must be based on records that accurately reflect the work performed and must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Budget estimates alone do not qualify as support for charges to federal awards, but can be used for interim accounting purposes provided that internal controls include an after-the-fact review to confirm the accuracy of final amounts charged to federal awards.Prior approval requirements related to key personnel effort are contained in 2 CFR 200.308(c) and within grant terms and conditions. A reduction of 25% or greater in time devoted to the project from key personnel requires prior approval.Cause:Management represented that it?s still in the process of implementing the prior-year corrective actions to address the issues noted in the prior-year finding. As a result, time and effort certifications were not completed by employees to support the accuracy of budget estimates charged to federal awards as required by 2 CFR 200.430(i).Effect:Inadequate controls related to federal documentation standards for personnel expenses could result in noncompliance with federal allowable costs and cost principles, as well as noncompliance with special tests and provisions related to key personnel effort.Recommendation:Management should strengthen internal controls to ensure that personnel expenses charged to the federal awards are supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated.Management?s Response and Corrective Action Plan:Management did not concur with the finding, noting it did not have sufficient time in fiscal year 2022 for corrective action and provided its progress on addressing the finding (B-82).
2022-017 - Improper Payments to Southern University Law Center EmployeeAward Year: 2022Award Number: P031K190024Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesRepeat Finding: NoSee Schedule of Findings and Questioned Costs for chart/tableCondition:Southern University (SU) Human Resources identified improper payments to a former Southern University Law Center (SULC) professor totaling $77,896. In addition, $31,898 in related benefits were paid on behalf of the professor.The SULC employee resigned from a full-time position in June 2021, while continuing to teach as an adjunct professor during the Fall 2021 semester. SU Human Resources and SULC did not terminate the full-time position in the Banner system. This allowed the employee to complete time statements and be paid for both the adjunct and the full-time position. In June 2022, SU Human Resources discovered the overpayments and requested restitution.Criteria:2 CFR 200.430(i) requires that charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed, and these records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated.The SU handbook for university personnel, federal statutes, the Louisiana Department of Civil Service, and other Louisiana laws require that the university maintain accurate accounting of hours worked on every employee. In addition, the university processes payroll electronically through Banner Web Time, which requires employees to enter time worked, leave taken, and supervisors to approve the time sheets online.Cause:This overpayment occurred due to a failure of internal controls to ensure employment status changes were updated in the Banner system and that time sheet approvals were for actual hours worked.Effect:The overpayment of $109,794 was not recouped by SULC as of June 30, 2022. Of the total overpayment, $105,567 was charged to the Higher Education Institutional Aid federal program, including $30,670 in benefits, and is considered questioned costs.Recommendation:Management should strengthen internal controls to ensure terminated employee positions are deactivated in the Banner system timely and that timesheet approvals are for hours worked.Management?s Response and Corrective Action Plan:Management concurred with the finding and provided a corrective action plan (B-81).
2022-004 - Inadequate Controls over PayrollAward Year: 2022Award Numbers: 6LA700503, NU50CK000532, NU62PS924522, NU62PS924620, NU90TP922016Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesRepeat Finding: Yes (Prior Year Finding No. 2021-005)See Schedule of Findings and Questioned Costs for chart/tableCondition:The Louisiana Department of Health, Office of Public Health (OPH) did not ensure payroll expenditures were timely certified and approved for the WIC Special Supplemental Nutrition Program for Women, Infants, and Children; the Public Health Emergency Preparedness program; the Epidemiology and Laboratory Capacity for Infectious Diseases program; and the HIV Prevention Activities Health Department Based program. This is the third consecutive year payroll internal control deficiencies have been reported for Public Health Emergency Preparedness program and HIV Prevention Activities Health Department Based program, and the second consecutive year for WIC Special Supplemental Nutrition Program for Women, Infants, and Children and Epidemiology and Laboratory Capacity for Infectious Diseases program. Exceptions for each federal program are as follows:? For the WIC Special Supplemental Nutrition Program for Women, Infants, and Children, a non-statistical sample of 60 payroll transactions was tested from a population of 6,184 transactions totaling $8,970,425. Five (8%) time statements were not timely approved by the employees? supervisor, of which two (3%) were not approved at all, and two (3%) were not certified timely by the employees ranging from 13 to 236 days after the posting date.? For the Public Health Emergency Preparedness program, a non-statistical sample of 60 payroll transactions was tested from a population of 1,394 transactions totaling $3,988,398. Twenty-one (35%) time statements were not timely approved by the employees? supervisors, of which 12 (20%) were approved ranging from 23 days to 447 days after posting date and seven (12%) were not approved at all; two (3%) were not certified by the employees; and two (3%) were approved before certified.? For the Epidemiology and Laboratory Capacity for Infectious Diseases program, a non-statistical sample of 60 payroll transactions was tested from a population of 3,933 transactions totaling $5,190,684. Nine (15%) time statements were not timely approved by the employees? supervisors, of which four (7%) were not approved at all; one (2%) was not certified by the employee; and one (2%) was approved before certified.? For the HIV Prevention Activities Health Department Based program, a non-statistical sample of 60 payroll transactions was tested from a population of 1,024 transactions totaling $386,769. Nine (15%) time statements were not timely approved by the employees? supervisors, of which one (2%) was not approved at all; seven (12%) were approved ranging from one day to 351 days after the posting date; and one (2%) was not certified by the employee.Criteria:2 CFR 200.430(i) requires that records must be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, the records must comply with the established accounting policies and practices of the non-federal entity.The Division of Administration Personnel Policy No. 99 requires employees and supervisors to certify and/or approve time statements for accuracy by 10:00 p.m. on the Wednesday following the close of the pay period. Time administrators are responsible for reviewing the LaGov ZP241 eCertification report prior to processing to identify any employees who have not certified their time statements and any supervisors who have not approved their staff?s time statements.Cause:OPH lacked sufficient controls to ensure electronic time statements were properly certified and approved prior to the posting date in accordance with federal and state regulations.Effect:Failure to adequately approve program expenditures increases the risk that unallowable costs could be reimbursed by the federal grantor.Recommendation:OPH should ensure employees comply with existing policies and procedures, including certifying and approving electronic time statements in a timely manner.Management?s Response and Corrective Action Plan:Management concurred with the finding and provided a corrective action plan (B-43).
2022-004 - Inadequate Controls over PayrollAward Year: 2022Award Numbers: 6LA700503, NU50CK000532, NU62PS924522, NU62PS924620, NU90TP922016Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesRepeat Finding: Yes (Prior Year Finding No. 2021-005)See Schedule of Findings and Questioned Costs for chart/tableCondition:The Louisiana Department of Health, Office of Public Health (OPH) did not ensure payroll expenditures were timely certified and approved for the WIC Special Supplemental Nutrition Program for Women, Infants, and Children; the Public Health Emergency Preparedness program; the Epidemiology and Laboratory Capacity for Infectious Diseases program; and the HIV Prevention Activities Health Department Based program. This is the third consecutive year payroll internal control deficiencies have been reported for Public Health Emergency Preparedness program and HIV Prevention Activities Health Department Based program, and the second consecutive year for WIC Special Supplemental Nutrition Program for Women, Infants, and Children and Epidemiology and Laboratory Capacity for Infectious Diseases program. Exceptions for each federal program are as follows:? For the WIC Special Supplemental Nutrition Program for Women, Infants, and Children, a non-statistical sample of 60 payroll transactions was tested from a population of 6,184 transactions totaling $8,970,425. Five (8%) time statements were not timely approved by the employees? supervisor, of which two (3%) were not approved at all, and two (3%) were not certified timely by the employees ranging from 13 to 236 days after the posting date.? For the Public Health Emergency Preparedness program, a non-statistical sample of 60 payroll transactions was tested from a population of 1,394 transactions totaling $3,988,398. Twenty-one (35%) time statements were not timely approved by the employees? supervisors, of which 12 (20%) were approved ranging from 23 days to 447 days after posting date and seven (12%) were not approved at all; two (3%) were not certified by the employees; and two (3%) were approved before certified.? For the Epidemiology and Laboratory Capacity for Infectious Diseases program, a non-statistical sample of 60 payroll transactions was tested from a population of 3,933 transactions totaling $5,190,684. Nine (15%) time statements were not timely approved by the employees? supervisors, of which four (7%) were not approved at all; one (2%) was not certified by the employee; and one (2%) was approved before certified.? For the HIV Prevention Activities Health Department Based program, a non-statistical sample of 60 payroll transactions was tested from a population of 1,024 transactions totaling $386,769. Nine (15%) time statements were not timely approved by the employees? supervisors, of which one (2%) was not approved at all; seven (12%) were approved ranging from one day to 351 days after the posting date; and one (2%) was not certified by the employee.Criteria:2 CFR 200.430(i) requires that records must be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, the records must comply with the established accounting policies and practices of the non-federal entity.The Division of Administration Personnel Policy No. 99 requires employees and supervisors to certify and/or approve time statements for accuracy by 10:00 p.m. on the Wednesday following the close of the pay period. Time administrators are responsible for reviewing the LaGov ZP241 eCertification report prior to processing to identify any employees who have not certified their time statements and any supervisors who have not approved their staff?s time statements.Cause:OPH lacked sufficient controls to ensure electronic time statements were properly certified and approved prior to the posting date in accordance with federal and state regulations.Effect:Failure to adequately approve program expenditures increases the risk that unallowable costs could be reimbursed by the federal grantor.Recommendation:OPH should ensure employees comply with existing policies and procedures, including certifying and approving electronic time statements in a timely manner.Management?s Response and Corrective Action Plan:Management concurred with the finding and provided a corrective action plan (B-43).
2022-004 - Inadequate Controls over PayrollAward Year: 2022Award Numbers: 6LA700503, NU50CK000532, NU62PS924522, NU62PS924620, NU90TP922016Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesRepeat Finding: Yes (Prior Year Finding No. 2021-005)See Schedule of Findings and Questioned Costs for chart/tableCondition:The Louisiana Department of Health, Office of Public Health (OPH) did not ensure payroll expenditures were timely certified and approved for the WIC Special Supplemental Nutrition Program for Women, Infants, and Children; the Public Health Emergency Preparedness program; the Epidemiology and Laboratory Capacity for Infectious Diseases program; and the HIV Prevention Activities Health Department Based program. This is the third consecutive year payroll internal control deficiencies have been reported for Public Health Emergency Preparedness program and HIV Prevention Activities Health Department Based program, and the second consecutive year for WIC Special Supplemental Nutrition Program for Women, Infants, and Children and Epidemiology and Laboratory Capacity for Infectious Diseases program. Exceptions for each federal program are as follows:? For the WIC Special Supplemental Nutrition Program for Women, Infants, and Children, a non-statistical sample of 60 payroll transactions was tested from a population of 6,184 transactions totaling $8,970,425. Five (8%) time statements were not timely approved by the employees? supervisor, of which two (3%) were not approved at all, and two (3%) were not certified timely by the employees ranging from 13 to 236 days after the posting date.? For the Public Health Emergency Preparedness program, a non-statistical sample of 60 payroll transactions was tested from a population of 1,394 transactions totaling $3,988,398. Twenty-one (35%) time statements were not timely approved by the employees? supervisors, of which 12 (20%) were approved ranging from 23 days to 447 days after posting date and seven (12%) were not approved at all; two (3%) were not certified by the employees; and two (3%) were approved before certified.? For the Epidemiology and Laboratory Capacity for Infectious Diseases program, a non-statistical sample of 60 payroll transactions was tested from a population of 3,933 transactions totaling $5,190,684. Nine (15%) time statements were not timely approved by the employees? supervisors, of which four (7%) were not approved at all; one (2%) was not certified by the employee; and one (2%) was approved before certified.? For the HIV Prevention Activities Health Department Based program, a non-statistical sample of 60 payroll transactions was tested from a population of 1,024 transactions totaling $386,769. Nine (15%) time statements were not timely approved by the employees? supervisors, of which one (2%) was not approved at all; seven (12%) were approved ranging from one day to 351 days after the posting date; and one (2%) was not certified by the employee.Criteria:2 CFR 200.430(i) requires that records must be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, the records must comply with the established accounting policies and practices of the non-federal entity.The Division of Administration Personnel Policy No. 99 requires employees and supervisors to certify and/or approve time statements for accuracy by 10:00 p.m. on the Wednesday following the close of the pay period. Time administrators are responsible for reviewing the LaGov ZP241 eCertification report prior to processing to identify any employees who have not certified their time statements and any supervisors who have not approved their staff?s time statements.Cause:OPH lacked sufficient controls to ensure electronic time statements were properly certified and approved prior to the posting date in accordance with federal and state regulations.Effect:Failure to adequately approve program expenditures increases the risk that unallowable costs could be reimbursed by the federal grantor.Recommendation:OPH should ensure employees comply with existing policies and procedures, including certifying and approving electronic time statements in a timely manner.Management?s Response and Corrective Action Plan:Management concurred with the finding and provided a corrective action plan (B-43).
2022-004 - Inadequate Controls over PayrollAward Year: 2022Award Numbers: 6LA700503, NU50CK000532, NU62PS924522, NU62PS924620, NU90TP922016Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesRepeat Finding: Yes (Prior Year Finding No. 2021-005)See Schedule of Findings and Questioned Costs for chart/tableCondition:The Louisiana Department of Health, Office of Public Health (OPH) did not ensure payroll expenditures were timely certified and approved for the WIC Special Supplemental Nutrition Program for Women, Infants, and Children; the Public Health Emergency Preparedness program; the Epidemiology and Laboratory Capacity for Infectious Diseases program; and the HIV Prevention Activities Health Department Based program. This is the third consecutive year payroll internal control deficiencies have been reported for Public Health Emergency Preparedness program and HIV Prevention Activities Health Department Based program, and the second consecutive year for WIC Special Supplemental Nutrition Program for Women, Infants, and Children and Epidemiology and Laboratory Capacity for Infectious Diseases program. Exceptions for each federal program are as follows:? For the WIC Special Supplemental Nutrition Program for Women, Infants, and Children, a non-statistical sample of 60 payroll transactions was tested from a population of 6,184 transactions totaling $8,970,425. Five (8%) time statements were not timely approved by the employees? supervisor, of which two (3%) were not approved at all, and two (3%) were not certified timely by the employees ranging from 13 to 236 days after the posting date.? For the Public Health Emergency Preparedness program, a non-statistical sample of 60 payroll transactions was tested from a population of 1,394 transactions totaling $3,988,398. Twenty-one (35%) time statements were not timely approved by the employees? supervisors, of which 12 (20%) were approved ranging from 23 days to 447 days after posting date and seven (12%) were not approved at all; two (3%) were not certified by the employees; and two (3%) were approved before certified.? For the Epidemiology and Laboratory Capacity for Infectious Diseases program, a non-statistical sample of 60 payroll transactions was tested from a population of 3,933 transactions totaling $5,190,684. Nine (15%) time statements were not timely approved by the employees? supervisors, of which four (7%) were not approved at all; one (2%) was not certified by the employee; and one (2%) was approved before certified.? For the HIV Prevention Activities Health Department Based program, a non-statistical sample of 60 payroll transactions was tested from a population of 1,024 transactions totaling $386,769. Nine (15%) time statements were not timely approved by the employees? supervisors, of which one (2%) was not approved at all; seven (12%) were approved ranging from one day to 351 days after the posting date; and one (2%) was not certified by the employee.Criteria:2 CFR 200.430(i) requires that records must be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, the records must comply with the established accounting policies and practices of the non-federal entity.The Division of Administration Personnel Policy No. 99 requires employees and supervisors to certify and/or approve time statements for accuracy by 10:00 p.m. on the Wednesday following the close of the pay period. Time administrators are responsible for reviewing the LaGov ZP241 eCertification report prior to processing to identify any employees who have not certified their time statements and any supervisors who have not approved their staff?s time statements.Cause:OPH lacked sufficient controls to ensure electronic time statements were properly certified and approved prior to the posting date in accordance with federal and state regulations.Effect:Failure to adequately approve program expenditures increases the risk that unallowable costs could be reimbursed by the federal grantor.Recommendation:OPH should ensure employees comply with existing policies and procedures, including certifying and approving electronic time statements in a timely manner.Management?s Response and Corrective Action Plan:Management concurred with the finding and provided a corrective action plan (B-43).
2022-004 - Inadequate Controls over PayrollAward Year: 2022Award Numbers: 6LA700503, NU50CK000532, NU62PS924522, NU62PS924620, NU90TP922016Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesRepeat Finding: Yes (Prior Year Finding No. 2021-005)See Schedule of Findings and Questioned Costs for chart/tableCondition:The Louisiana Department of Health, Office of Public Health (OPH) did not ensure payroll expenditures were timely certified and approved for the WIC Special Supplemental Nutrition Program for Women, Infants, and Children; the Public Health Emergency Preparedness program; the Epidemiology and Laboratory Capacity for Infectious Diseases program; and the HIV Prevention Activities Health Department Based program. This is the third consecutive year payroll internal control deficiencies have been reported for Public Health Emergency Preparedness program and HIV Prevention Activities Health Department Based program, and the second consecutive year for WIC Special Supplemental Nutrition Program for Women, Infants, and Children and Epidemiology and Laboratory Capacity for Infectious Diseases program. Exceptions for each federal program are as follows:? For the WIC Special Supplemental Nutrition Program for Women, Infants, and Children, a non-statistical sample of 60 payroll transactions was tested from a population of 6,184 transactions totaling $8,970,425. Five (8%) time statements were not timely approved by the employees? supervisor, of which two (3%) were not approved at all, and two (3%) were not certified timely by the employees ranging from 13 to 236 days after the posting date.? For the Public Health Emergency Preparedness program, a non-statistical sample of 60 payroll transactions was tested from a population of 1,394 transactions totaling $3,988,398. Twenty-one (35%) time statements were not timely approved by the employees? supervisors, of which 12 (20%) were approved ranging from 23 days to 447 days after posting date and seven (12%) were not approved at all; two (3%) were not certified by the employees; and two (3%) were approved before certified.? For the Epidemiology and Laboratory Capacity for Infectious Diseases program, a non-statistical sample of 60 payroll transactions was tested from a population of 3,933 transactions totaling $5,190,684. Nine (15%) time statements were not timely approved by the employees? supervisors, of which four (7%) were not approved at all; one (2%) was not certified by the employee; and one (2%) was approved before certified.? For the HIV Prevention Activities Health Department Based program, a non-statistical sample of 60 payroll transactions was tested from a population of 1,024 transactions totaling $386,769. Nine (15%) time statements were not timely approved by the employees? supervisors, of which one (2%) was not approved at all; seven (12%) were approved ranging from one day to 351 days after the posting date; and one (2%) was not certified by the employee.Criteria:2 CFR 200.430(i) requires that records must be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, the records must comply with the established accounting policies and practices of the non-federal entity.The Division of Administration Personnel Policy No. 99 requires employees and supervisors to certify and/or approve time statements for accuracy by 10:00 p.m. on the Wednesday following the close of the pay period. Time administrators are responsible for reviewing the LaGov ZP241 eCertification report prior to processing to identify any employees who have not certified their time statements and any supervisors who have not approved their staff?s time statements.Cause:OPH lacked sufficient controls to ensure electronic time statements were properly certified and approved prior to the posting date in accordance with federal and state regulations.Effect:Failure to adequately approve program expenditures increases the risk that unallowable costs could be reimbursed by the federal grantor.Recommendation:OPH should ensure employees comply with existing policies and procedures, including certifying and approving electronic time statements in a timely manner.Management?s Response and Corrective Action Plan:Management concurred with the finding and provided a corrective action plan (B-43).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-006 - Control Weakness and Noncompliance with Personnel Expenses Charged to Federal AwardsAward Years: 2018, 2019, 2021, 2022Award Numbers: 2138930, 2000614536, B-18-DP-22-001, EMW-2020-SS-00011-S01, M19AC00015, NR227217XXXXC002, P01AI048240, R21AI165939, R33HD099745, U19AI159840Compliance Requirements: Allowable Costs/Cost Principles, Special Tests and ProvisionsPass-Through Entities: Board of Trustees of the Leland Stanford Junior University, Emory UniversityRepeat Finding: Yes (Prior Year Finding No. 2021-009)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the second consecutive year, the University of Louisiana at Lafayette (UL Lafayette) did not have adequate controls in place to ensure personnel expenses and effort charged to federal R&D awards accurately reflected work performed. From a population of 28,744 payroll and non-payroll expenses charged to R&D grants, a non-statistical sample of 25 transactions was tested. For all 12 (48%) of the payroll transactions, UL Lafayette was unable to provide documentation to show that personnel-related expenses, totaling $4,520, were supported by time and effort certifications to ensure the accuracy of budget estimates charged to federal awards as required by federal regulations. Additionally, because there is no after-the-fact review to ensure the accuracy of personnel costs and effort charged to the awards, UL Lafayette could not ensure compliance with the requirements of special tests and provisions related to key personnel effort.Criteria:2 CFR 200.430(i) specifies the documentation standards for personnel expenses. In order to be allowable, charges to federal awards for personnel expenses must be based on records that accurately reflect the work performed and must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Budget estimates alone do not qualify as support for charges to federal awards, but can be used for interim accounting purposes provided that internal controls include an after-the-fact review to confirm the accuracy of final amounts charged to federal awards.Prior approval requirements related to key personnel effort are contained in 2 CFR 200.308(c) and within grant terms and conditions. A reduction of 25% or greater in time devoted to the project from key personnel requires prior approval.Cause:Management represented that it?s still in the process of implementing the prior-year corrective actions to address the issues noted in the prior-year finding. As a result, time and effort certifications were not completed by employees to support the accuracy of budget estimates charged to federal awards as required by 2 CFR 200.430(i).Effect:Inadequate controls related to federal documentation standards for personnel expenses could result in noncompliance with federal allowable costs and cost principles, as well as noncompliance with special tests and provisions related to key personnel effort.Recommendation:Management should strengthen internal controls to ensure that personnel expenses charged to the federal awards are supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated.Management?s Response and Corrective Action Plan:Management did not concur with the finding, noting it did not have sufficient time in fiscal year 2022 for corrective action and provided its progress on addressing the finding (B-82).
2022-006 - Control Weakness and Noncompliance with Personnel Expenses Charged to Federal AwardsAward Years: 2018, 2019, 2021, 2022Award Numbers: 2138930, 2000614536, B-18-DP-22-001, EMW-2020-SS-00011-S01, M19AC00015, NR227217XXXXC002, P01AI048240, R21AI165939, R33HD099745, U19AI159840Compliance Requirements: Allowable Costs/Cost Principles, Special Tests and ProvisionsPass-Through Entities: Board of Trustees of the Leland Stanford Junior University, Emory UniversityRepeat Finding: Yes (Prior Year Finding No. 2021-009)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the second consecutive year, the University of Louisiana at Lafayette (UL Lafayette) did not have adequate controls in place to ensure personnel expenses and effort charged to federal R&D awards accurately reflected work performed. From a population of 28,744 payroll and non-payroll expenses charged to R&D grants, a non-statistical sample of 25 transactions was tested. For all 12 (48%) of the payroll transactions, UL Lafayette was unable to provide documentation to show that personnel-related expenses, totaling $4,520, were supported by time and effort certifications to ensure the accuracy of budget estimates charged to federal awards as required by federal regulations. Additionally, because there is no after-the-fact review to ensure the accuracy of personnel costs and effort charged to the awards, UL Lafayette could not ensure compliance with the requirements of special tests and provisions related to key personnel effort.Criteria:2 CFR 200.430(i) specifies the documentation standards for personnel expenses. In order to be allowable, charges to federal awards for personnel expenses must be based on records that accurately reflect the work performed and must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Budget estimates alone do not qualify as support for charges to federal awards, but can be used for interim accounting purposes provided that internal controls include an after-the-fact review to confirm the accuracy of final amounts charged to federal awards.Prior approval requirements related to key personnel effort are contained in 2 CFR 200.308(c) and within grant terms and conditions. A reduction of 25% or greater in time devoted to the project from key personnel requires prior approval.Cause:Management represented that it?s still in the process of implementing the prior-year corrective actions to address the issues noted in the prior-year finding. As a result, time and effort certifications were not completed by employees to support the accuracy of budget estimates charged to federal awards as required by 2 CFR 200.430(i).Effect:Inadequate controls related to federal documentation standards for personnel expenses could result in noncompliance with federal allowable costs and cost principles, as well as noncompliance with special tests and provisions related to key personnel effort.Recommendation:Management should strengthen internal controls to ensure that personnel expenses charged to the federal awards are supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated.Management?s Response and Corrective Action Plan:Management did not concur with the finding, noting it did not have sufficient time in fiscal year 2022 for corrective action and provided its progress on addressing the finding (B-82).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).
2022-006 - Control Weakness and Noncompliance with Personnel Expenses Charged to Federal AwardsAward Years: 2018, 2019, 2021, 2022Award Numbers: 2138930, 2000614536, B-18-DP-22-001, EMW-2020-SS-00011-S01, M19AC00015, NR227217XXXXC002, P01AI048240, R21AI165939, R33HD099745, U19AI159840Compliance Requirements: Allowable Costs/Cost Principles, Special Tests and ProvisionsPass-Through Entities: Board of Trustees of the Leland Stanford Junior University, Emory UniversityRepeat Finding: Yes (Prior Year Finding No. 2021-009)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the second consecutive year, the University of Louisiana at Lafayette (UL Lafayette) did not have adequate controls in place to ensure personnel expenses and effort charged to federal R&D awards accurately reflected work performed. From a population of 28,744 payroll and non-payroll expenses charged to R&D grants, a non-statistical sample of 25 transactions was tested. For all 12 (48%) of the payroll transactions, UL Lafayette was unable to provide documentation to show that personnel-related expenses, totaling $4,520, were supported by time and effort certifications to ensure the accuracy of budget estimates charged to federal awards as required by federal regulations. Additionally, because there is no after-the-fact review to ensure the accuracy of personnel costs and effort charged to the awards, UL Lafayette could not ensure compliance with the requirements of special tests and provisions related to key personnel effort.Criteria:2 CFR 200.430(i) specifies the documentation standards for personnel expenses. In order to be allowable, charges to federal awards for personnel expenses must be based on records that accurately reflect the work performed and must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Budget estimates alone do not qualify as support for charges to federal awards, but can be used for interim accounting purposes provided that internal controls include an after-the-fact review to confirm the accuracy of final amounts charged to federal awards.Prior approval requirements related to key personnel effort are contained in 2 CFR 200.308(c) and within grant terms and conditions. A reduction of 25% or greater in time devoted to the project from key personnel requires prior approval.Cause:Management represented that it?s still in the process of implementing the prior-year corrective actions to address the issues noted in the prior-year finding. As a result, time and effort certifications were not completed by employees to support the accuracy of budget estimates charged to federal awards as required by 2 CFR 200.430(i).Effect:Inadequate controls related to federal documentation standards for personnel expenses could result in noncompliance with federal allowable costs and cost principles, as well as noncompliance with special tests and provisions related to key personnel effort.Recommendation:Management should strengthen internal controls to ensure that personnel expenses charged to the federal awards are supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated.Management?s Response and Corrective Action Plan:Management did not concur with the finding, noting it did not have sufficient time in fiscal year 2022 for corrective action and provided its progress on addressing the finding (B-82).
2022-005 - Noncompliance with and Weakness in Controls over Federal Research and Development ExpensesAward Years: VariousAward Numbers: VariousCompliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost PrinciplesPass-Through Entities: VariousRepeat Finding: Yes (Prior Year Finding No. 2021-007)See Schedule of Findings and Questioned Costs for chart/tableCondition:For the fourth consecutive year, Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) did not ensure internal control over documentation of personnel services were operating effectively, and did not ensure compliance with federal guidance regarding cost transfers applicable to the Research and Development (R&D) Cluster. In addition, LSUHSC-S did not ensure that costs charged to federal awards were allowable in accordance with federal regulations and the terms and conditions of the award when requesting reimbursement.In a non-statistical random sample of 50 out of 10,798 expense transactions charged to R&D during the fiscal year ending June 30, 2022, the following exceptions were noted:? Three (6%) purchasing card (P-Card) transactions were not allowable in accordance with federal regulations and the terms and conditions of the award and are considered questioned costs totaling $1,073.? For five (10%) of 50 transactions tested, LSUHSC-S overstated expenses on the Schedule of Expenditures of Federal Awards because the award was fully funded, and expenses in excess of the award amount were not removed from the project used to identify expenditures to federal awards in the accounting records, or the expense was determined not allowable as noted above.? Seven (35%) of 20 time and effort certifications for salary and related benefit expenses tested were completed 119 to 461 days after the end of the quarter.We performed an analysis of payroll adjusting journal entries to record cost transfers to and/or from R&D awards. We noted that 838 (51%) out of 1,654 adjusting journal entries were made more than 90 days after the end of the quarter from the original transactions. The adjustments were made 97 to 1,026 days after the original transactions were recorded and 96 to 953 days after the end of the quarter.In a non-statistical random sample of 10 out of 1,654 payroll adjusting entries affecting R&D, tested by employee, project id (related to federal award), and journal id, six (60%) adjustments did not have adequate documentation for cost transfers to fully explain how the error occurred and a sufficient explanation to support the correctness of the new charge. Two of these adjusting entries added costs to the federal award projects and are considered questioned costs totaling $28,324.Criteria:2 CFR 200.430(i)(1)(i) requires 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. Per 2 CFR 200.430(i)(1)(viii), budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that significant changes in work activity are identified and entered into the records in a timely manner and the non-federal entity?s system of internal controls includes processes to review after-the-fact charges and make necessary adjustments.Per LSUHSC-S?s Time and Effort Certification Policy and Procedures, LSUHSC-S utilizes time and effort certifications to support salary charges to sponsored projects as an after-the-fact certification of effort of all individuals when all or a portion of their salaries are charged to a sponsored project. Based on LSUHSC-S?s policy, time and effort certifications should be completed within approximately 90 days of the end of the quarter. Management interprets the end of the quarter to be when the time and effort reports are sent to the departments once the last month of the quarter is closed in the accounting system. If there is a substantial (5% or more) difference between the salary charges and the effort actually expended by the individual on projects during the quarterly reporting period, a payroll reallocation must be created within 30 days.Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal control over the federal award. These internal controls should be in compliance with guidance in the ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission. Per the Standards for Internal Control in the Federal Government, examples of common categories of control activities include accurate and timely recording of transactions.In addition, the National Institute of Health (NIH) is the grantor for the majority of the LSUHSC-S?s R&D grant awards. Per the NIH Grants Policy Statement 7.5, cost transfers that represent corrections of clerical or bookkeeping errors should be accomplished within 90 days of when the error was discovered. The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official. An explanation merely stating that the transfer was made ?to correct error" or "to transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable.2 CFR 200 Subpart E and the terms and conditions of the award establish requirements for non-federal entities receiving federal awards that govern the allowability of costs.Cause:LSUHSC-S?s approval of P-Card transactions did not provide sufficient review of the allowability of expenses on federal awards. LSUHSC-S has procedures in place to review expenses prior to requesting reimbursement; however, it did not ensure that the necessary adjustments were made to the accounting system in a timely manner for expenses that were not allowed for reimbursement. In addition, training to emphasize accountability and the importance of completing time and effort certifications timely and accurately per policy was not completed as planned during fiscal year 2022 due to staffing shortages.LSUHSC-S is still in the process of implementing the corrective action outlined in the prior year to include documentation of adjusted effort and questions to address justification for the adjustment, errors, and timeliness on a modified Personnel Change form.Effect:Untimely certifications and the untimely discovery and correction of errors increases the risk of inaccurate reporting and may result in an inability to complete approved projects within the approved budget and/or period of performance. As a result, LSUHSC-S may have to utilize university funds to complete approved projects.In addition, inadequate controls and noncompliance with federal awards increases the likelihood of disallowed costs, which LSUHSC-S may have to repay to the federal grantor.Recommendation:Management should monitor time and effort certifications completed by the departments and investigate and obtain justification from department personnel for untimely certifications, as well as untimely adjustments and lack of supporting documentation for adjustments to enforce established policies. Management should ensure adequate design and operating effectiveness of controls over expenses, including P-Card expenses, charged to federal awards to verify allowability of costs in accordance with federal requirements and grant terms and conditions prior to requesting reimbursement. Management should also consider implementing other complementary controls such as preventing costs from being charged to projects in the accounting system beyond the approved budget or period of performance.Management?s Response and Corrective Action Plan:Management concurred with the finding and outlined a plan of corrective action (B-52).