Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Federal Agencies: Department of Housing and Urban Development and Department of Health and Human Services Federal Assistance Listing Numbers: 14.231, 14.267, 93.224 & 93.527 Program: Emergency Solutions Grant Program, Continuum of Care Program, Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: HH-21-03.4, CA0802L9D012214, CA0802L9D012315, CA1348L9D012208, CA1348L9D012309, CA1510L9D012207, CA1510L9D012308, CA1883L9D012203, CA1883L9D012304, HHI-24-09, SIHI-25-07, HHI-24-04, SIHI-25-18, H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in Subpart E 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Further, matching funds must also be allowable under Subpart E – Cost Principles. Per 2 CFR §200.430 Compensation – Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control, which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the recipient or subrecipient; and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (vii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity performed; (B) Significant changes in the related work activity (as defined by the recipient’s or subrecipient’s written policies) are promptly identified and entered into the records. Short-term (such as one or two months) fluctuations between workload categories do not need to be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The recipient’s or subrecipient’s system of internal controls includes processes to perform periodic after-the-fact reviews of interim charges made to a Federal award based on budget estimates. All necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: We noted that the Village allocated payroll expenditures to Emergency Solutions Grants Program, Continuum of Care Program, and Health Center Cluster during 2024 that lacked adequate or timely documentation. During our testing we noted instances where supervisor did not approve timesheets, instances where the incorrect allocation rate was utilized, and instances where attestations were not completed timely to support employee’s time allocated to the grant for reimbursement. • For Emergency Solutions Grants Program: o 41 out of 60 selections did not have timely completion of attestations • For Continuum of Care Program: o 2 out of 100 selections utilized the incorrect allocation rate to the grant. • For Continuum of Care Program in our testing of Matching Costs: o 2 out of 60 selections did not have approved timesheets. o 2 out of 60 selections did not have timely completion of attestations. o 1 out of 60 selections utilized the incorrect allocation rate. • For Health Center Program Cluster: o 1 out of 60 selections utilized the incorrect allocation rate to the grant. o 14 out of 60 selections did not have timely completion of attestations. Cause: The Village did not have adequate policies/procedures in place to timely prepare and complete timesheet attestations and approvals and reconcile to actual expenditures charged. Additionally, the Village relied heavily on manual processes that are more prone to error and did not have an adequate review process to identify and correct calculation errors. Effect or Potential Effect: Without adequate controls in place to detect calculation errors and ensure attestations and timesheets were reviewed in a timely manner, the Village could incorrectly charge expenditures to the Federal program, or not request appropriate reimbursement the Village is entitled to under the terms of the grant. Questioned Costs: Emergency Solutions Grants Program: None Continuum of Care Program Known Questioned Costs: $1,575 Continuum of Care Program Likely Questioned Costs: $172,053 Health Center Program Cluster: None above the $25,000 reporting threshold. Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Emergency Solutions Grants Program in 2024 were $377,797. Payroll costs including fringe benefits for the Continuum of Care Program in 2024 were $1,217,865. Matching costs for the Continuum of Care Program in 2024 were $1,896,728. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Any costs not adequately supported by approved timesheet allocations or in excess of supported allocations are considered questioned costs. Repeat Finding: 2023-003, 2023-004, 2023-005 Recommendation: We recommend that the Village implement policies and procedures to ensure attestations are completed timely (i.e. quarterly) and to ensure timely review for any necessary budget to actual adjustments. Additionally, we recommend implementing system improvements to reduce manual entry and establishing policies to review reimbursement calculations before submission. Views of Responsible Officials:
Reference Number: 2024-002 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services Federal Program: Child Support Services Assistance Listing Number: 93.563 Pass-Through Entity: New York State Office of Temporary and Disability Assistance Identifying Number and Period: 18000 (2024) Compliance Requirement: Allowable Costs/Cost Principles – Time and Effort Reporting Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Compliance: 2 CFR Section 200.430 (8)(i) Standards for Documentation of Personnel Expenses states that: 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 that provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the recipient or subrecipient; (iii) Reasonably reflect the total activity for which the employee is compensated by the recipient or subrecipient, not exceeding 100 percent of compensated activities (for IHEs, this is the IBS); (iv) Encompass federally-assisted and all other activities compensated by the recipient or subrecipient on an integrated basis but may include the use of subsidiary records as defined in the recipient's or subrecipient's written policy; (v) Comply with the established accounting policies and procedures of the recipient or subrecipient (See paragraph (i)(1)(ii) of this section for treatment of incidental work for IHEs.); and (vi) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: 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 comply 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). Condition: Employee time and effort charged to the program did not agree with supporting documentation. Context: For two of thirty-three employee timesheets selected for testing, the amount claimed for employee time and effort did not agree with supporting documentation. Employee payroll data was entered incorrectly when the claim was compiled, resulting in an underclaim of the amount charged to the program. Cause: The County’s internal controls were not sufficient to ensure that employee time and effort charged to the program was accurate and tied to supporting documentation. Effect: The County underclaimed employee time and effort expended on the program. Questioned costs: None. The error resulted in an underclaim. Recommendation: The County should enhance its procedures and internal controls to ensure that employee time and effort charged to the program is accurate and agrees with supporting documentation. Views of Responsible Officials: There is no disagreement with the audit finding.
Allowable Costs - Payroll Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name / Assistance Listing Number / Pass-Through Agency(ies) / Pass-Through Number(s): • Block Grants for Prevention and Treatment of Substance Abuse, 93.959 o Passed through the State of Connecticut, Department of Mental Health and Addiction Services, 24MHA1009 o Passed through the Commonwealth of Pennsylvania, Department of Drug and Alcohol Programs, 4100089071 o Passed through the State of Louisiana, Department of Health, 2000758195 o Passed through the State of Oklahoma, Department of Mental Health and Substance Abuse Services, B08TI083962 & B08TI084602 • COVID-19 - Substance Abuse and Mental Health Services Projects of Regional and National Significance, 93.243 o Passed through the State of California, Department of Health Care Services, 21-10299 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or specific requirement: 2 CFR Part 200.430 (g) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award, Compensation – Personal Services requires compliance with standards for documentation of personnel expenses which include the following: “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 that provides reasonable assurance that the charges are accurate, allowable, and properly allocated;” Shatterproof should have internal controls designed and effectively operating to ensure compliance with those provisions. Condition: Monthly certifications of time allocations for employees terminated during 2024 were not performed. One instance was noted where the pay rate utilized did not agree to the HRIS system but in all other instances these rates agreed. Evidence supporting the approval of the pay rates in the HRIS system could not be provided. Questioned costs: Total questioned costs are $37,125 and are shown by program below: • 93.959 $7,168 State of Connecticut, Department of Mental Health and Addiction Services $11,001 Commonwealth of Pennsylvania, Department of Drug and Alcohol Programs $3,532 State of Louisiana, Department of Health $903 State of Oklahoma, Department of Mental Health and Substance Abuse Services • 93.243 $14,521 State of California, Department of Health Care Services Context: During our testing we identified 6 terminated employees whose time allocations were not documented through monthly certifications. We were able to substantiate through position descriptions and acceptance letters that two of these employees were fully chargeable to the grant and were not included in the questioned costs. Additionally we identified one employee in our testing whose pay rate utilized did not agree to the HRIS system, however, the difference was trivial and not included in the accumulation of questioned costs. Cause: Internal controls to certify time allocations by employees and their supervisors were put into place during 2024. Monthly certifications were prepared retroactive to January 2024, however certifications could not be completed for employees who were no longer employed by Shatterproof. Additionally, pay rates from the HRIS system were noted to be used in all but one instance, however, documentation of their approval was not retained. Effect: The lack of internal controls over these compliance requirements provides an opportunity for noncompliance and questioned costs. Repeat Finding: The finding is a modified repeat of findings in the immediately prior year. Prior year finding numbers were 2023-004 and 2023-005. Recommendation: We recommend Shatterproof ensure monthly certifications of time allocations by employees and their supervisors are performed and documented on a consistent basis. In addition, we recommend Shatterproof retain approval of the payrates entered into the HRIS and used to pay employees and ensure controls exist to ensure the proper rates are used. Views of responsible officials: There is no disagreement with the audit finding.
Allowable Costs - Payroll Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name / Assistance Listing Number / Pass-Through Agency(ies) / Pass-Through Number(s): • Block Grants for Prevention and Treatment of Substance Abuse, 93.959 o Passed through the State of Connecticut, Department of Mental Health and Addiction Services, 24MHA1009 o Passed through the Commonwealth of Pennsylvania, Department of Drug and Alcohol Programs, 4100089071 o Passed through the State of Louisiana, Department of Health, 2000758195 o Passed through the State of Oklahoma, Department of Mental Health and Substance Abuse Services, B08TI083962 & B08TI084602 • COVID-19 - Substance Abuse and Mental Health Services Projects of Regional and National Significance, 93.243 o Passed through the State of California, Department of Health Care Services, 21-10299 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or specific requirement: 2 CFR Part 200.430 (g) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award, Compensation – Personal Services requires compliance with standards for documentation of personnel expenses which include the following: “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 that provides reasonable assurance that the charges are accurate, allowable, and properly allocated;” Shatterproof should have internal controls designed and effectively operating to ensure compliance with those provisions. Condition: Monthly certifications of time allocations for employees terminated during 2024 were not performed. One instance was noted where the pay rate utilized did not agree to the HRIS system but in all other instances these rates agreed. Evidence supporting the approval of the pay rates in the HRIS system could not be provided. Questioned costs: Total questioned costs are $37,125 and are shown by program below: • 93.959 $7,168 State of Connecticut, Department of Mental Health and Addiction Services $11,001 Commonwealth of Pennsylvania, Department of Drug and Alcohol Programs $3,532 State of Louisiana, Department of Health $903 State of Oklahoma, Department of Mental Health and Substance Abuse Services • 93.243 $14,521 State of California, Department of Health Care Services Context: During our testing we identified 6 terminated employees whose time allocations were not documented through monthly certifications. We were able to substantiate through position descriptions and acceptance letters that two of these employees were fully chargeable to the grant and were not included in the questioned costs. Additionally we identified one employee in our testing whose pay rate utilized did not agree to the HRIS system, however, the difference was trivial and not included in the accumulation of questioned costs. Cause: Internal controls to certify time allocations by employees and their supervisors were put into place during 2024. Monthly certifications were prepared retroactive to January 2024, however certifications could not be completed for employees who were no longer employed by Shatterproof. Additionally, pay rates from the HRIS system were noted to be used in all but one instance, however, documentation of their approval was not retained. Effect: The lack of internal controls over these compliance requirements provides an opportunity for noncompliance and questioned costs. Repeat Finding: The finding is a modified repeat of findings in the immediately prior year. Prior year finding numbers were 2023-004 and 2023-005. Recommendation: We recommend Shatterproof ensure monthly certifications of time allocations by employees and their supervisors are performed and documented on a consistent basis. In addition, we recommend Shatterproof retain approval of the payrates entered into the HRIS and used to pay employees and ensure controls exist to ensure the proper rates are used. Views of responsible officials: There is no disagreement with the audit finding.
Allowable Costs - Payroll Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name / Assistance Listing Number / Pass-Through Agency(ies) / Pass-Through Number(s): • Block Grants for Prevention and Treatment of Substance Abuse, 93.959 o Passed through the State of Connecticut, Department of Mental Health and Addiction Services, 24MHA1009 o Passed through the Commonwealth of Pennsylvania, Department of Drug and Alcohol Programs, 4100089071 o Passed through the State of Louisiana, Department of Health, 2000758195 o Passed through the State of Oklahoma, Department of Mental Health and Substance Abuse Services, B08TI083962 & B08TI084602 • COVID-19 - Substance Abuse and Mental Health Services Projects of Regional and National Significance, 93.243 o Passed through the State of California, Department of Health Care Services, 21-10299 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or specific requirement: 2 CFR Part 200.430 (g) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award, Compensation – Personal Services requires compliance with standards for documentation of personnel expenses which include the following: “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 that provides reasonable assurance that the charges are accurate, allowable, and properly allocated;” Shatterproof should have internal controls designed and effectively operating to ensure compliance with those provisions. Condition: Monthly certifications of time allocations for employees terminated during 2024 were not performed. One instance was noted where the pay rate utilized did not agree to the HRIS system but in all other instances these rates agreed. Evidence supporting the approval of the pay rates in the HRIS system could not be provided. Questioned costs: Total questioned costs are $37,125 and are shown by program below: • 93.959 $7,168 State of Connecticut, Department of Mental Health and Addiction Services $11,001 Commonwealth of Pennsylvania, Department of Drug and Alcohol Programs $3,532 State of Louisiana, Department of Health $903 State of Oklahoma, Department of Mental Health and Substance Abuse Services • 93.243 $14,521 State of California, Department of Health Care Services Context: During our testing we identified 6 terminated employees whose time allocations were not documented through monthly certifications. We were able to substantiate through position descriptions and acceptance letters that two of these employees were fully chargeable to the grant and were not included in the questioned costs. Additionally we identified one employee in our testing whose pay rate utilized did not agree to the HRIS system, however, the difference was trivial and not included in the accumulation of questioned costs. Cause: Internal controls to certify time allocations by employees and their supervisors were put into place during 2024. Monthly certifications were prepared retroactive to January 2024, however certifications could not be completed for employees who were no longer employed by Shatterproof. Additionally, pay rates from the HRIS system were noted to be used in all but one instance, however, documentation of their approval was not retained. Effect: The lack of internal controls over these compliance requirements provides an opportunity for noncompliance and questioned costs. Repeat Finding: The finding is a modified repeat of findings in the immediately prior year. Prior year finding numbers were 2023-004 and 2023-005. Recommendation: We recommend Shatterproof ensure monthly certifications of time allocations by employees and their supervisors are performed and documented on a consistent basis. In addition, we recommend Shatterproof retain approval of the payrates entered into the HRIS and used to pay employees and ensure controls exist to ensure the proper rates are used. Views of responsible officials: There is no disagreement with the audit finding.
Allowable Costs - Payroll Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name / Assistance Listing Number / Pass-Through Agency(ies) / Pass-Through Number(s): • Block Grants for Prevention and Treatment of Substance Abuse, 93.959 o Passed through the State of Connecticut, Department of Mental Health and Addiction Services, 24MHA1009 o Passed through the Commonwealth of Pennsylvania, Department of Drug and Alcohol Programs, 4100089071 o Passed through the State of Louisiana, Department of Health, 2000758195 o Passed through the State of Oklahoma, Department of Mental Health and Substance Abuse Services, B08TI083962 & B08TI084602 • COVID-19 - Substance Abuse and Mental Health Services Projects of Regional and National Significance, 93.243 o Passed through the State of California, Department of Health Care Services, 21-10299 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or specific requirement: 2 CFR Part 200.430 (g) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award, Compensation – Personal Services requires compliance with standards for documentation of personnel expenses which include the following: “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 that provides reasonable assurance that the charges are accurate, allowable, and properly allocated;” Shatterproof should have internal controls designed and effectively operating to ensure compliance with those provisions. Condition: Monthly certifications of time allocations for employees terminated during 2024 were not performed. One instance was noted where the pay rate utilized did not agree to the HRIS system but in all other instances these rates agreed. Evidence supporting the approval of the pay rates in the HRIS system could not be provided. Questioned costs: Total questioned costs are $37,125 and are shown by program below: • 93.959 $7,168 State of Connecticut, Department of Mental Health and Addiction Services $11,001 Commonwealth of Pennsylvania, Department of Drug and Alcohol Programs $3,532 State of Louisiana, Department of Health $903 State of Oklahoma, Department of Mental Health and Substance Abuse Services • 93.243 $14,521 State of California, Department of Health Care Services Context: During our testing we identified 6 terminated employees whose time allocations were not documented through monthly certifications. We were able to substantiate through position descriptions and acceptance letters that two of these employees were fully chargeable to the grant and were not included in the questioned costs. Additionally we identified one employee in our testing whose pay rate utilized did not agree to the HRIS system, however, the difference was trivial and not included in the accumulation of questioned costs. Cause: Internal controls to certify time allocations by employees and their supervisors were put into place during 2024. Monthly certifications were prepared retroactive to January 2024, however certifications could not be completed for employees who were no longer employed by Shatterproof. Additionally, pay rates from the HRIS system were noted to be used in all but one instance, however, documentation of their approval was not retained. Effect: The lack of internal controls over these compliance requirements provides an opportunity for noncompliance and questioned costs. Repeat Finding: The finding is a modified repeat of findings in the immediately prior year. Prior year finding numbers were 2023-004 and 2023-005. Recommendation: We recommend Shatterproof ensure monthly certifications of time allocations by employees and their supervisors are performed and documented on a consistent basis. In addition, we recommend Shatterproof retain approval of the payrates entered into the HRIS and used to pay employees and ensure controls exist to ensure the proper rates are used. Views of responsible officials: There is no disagreement with the audit finding.
Allowable Costs - Payroll Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name / Assistance Listing Number / Pass-Through Agency(ies) / Pass-Through Number(s): • Block Grants for Prevention and Treatment of Substance Abuse, 93.959 o Passed through the State of Connecticut, Department of Mental Health and Addiction Services, 24MHA1009 o Passed through the Commonwealth of Pennsylvania, Department of Drug and Alcohol Programs, 4100089071 o Passed through the State of Louisiana, Department of Health, 2000758195 o Passed through the State of Oklahoma, Department of Mental Health and Substance Abuse Services, B08TI083962 & B08TI084602 • COVID-19 - Substance Abuse and Mental Health Services Projects of Regional and National Significance, 93.243 o Passed through the State of California, Department of Health Care Services, 21-10299 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or specific requirement: 2 CFR Part 200.430 (g) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award, Compensation – Personal Services requires compliance with standards for documentation of personnel expenses which include the following: “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 that provides reasonable assurance that the charges are accurate, allowable, and properly allocated;” Shatterproof should have internal controls designed and effectively operating to ensure compliance with those provisions. Condition: Monthly certifications of time allocations for employees terminated during 2024 were not performed. One instance was noted where the pay rate utilized did not agree to the HRIS system but in all other instances these rates agreed. Evidence supporting the approval of the pay rates in the HRIS system could not be provided. Questioned costs: Total questioned costs are $37,125 and are shown by program below: • 93.959 $7,168 State of Connecticut, Department of Mental Health and Addiction Services $11,001 Commonwealth of Pennsylvania, Department of Drug and Alcohol Programs $3,532 State of Louisiana, Department of Health $903 State of Oklahoma, Department of Mental Health and Substance Abuse Services • 93.243 $14,521 State of California, Department of Health Care Services Context: During our testing we identified 6 terminated employees whose time allocations were not documented through monthly certifications. We were able to substantiate through position descriptions and acceptance letters that two of these employees were fully chargeable to the grant and were not included in the questioned costs. Additionally we identified one employee in our testing whose pay rate utilized did not agree to the HRIS system, however, the difference was trivial and not included in the accumulation of questioned costs. Cause: Internal controls to certify time allocations by employees and their supervisors were put into place during 2024. Monthly certifications were prepared retroactive to January 2024, however certifications could not be completed for employees who were no longer employed by Shatterproof. Additionally, pay rates from the HRIS system were noted to be used in all but one instance, however, documentation of their approval was not retained. Effect: The lack of internal controls over these compliance requirements provides an opportunity for noncompliance and questioned costs. Repeat Finding: The finding is a modified repeat of findings in the immediately prior year. Prior year finding numbers were 2023-004 and 2023-005. Recommendation: We recommend Shatterproof ensure monthly certifications of time allocations by employees and their supervisors are performed and documented on a consistent basis. In addition, we recommend Shatterproof retain approval of the payrates entered into the HRIS and used to pay employees and ensure controls exist to ensure the proper rates are used. Views of responsible officials: There is no disagreement with the audit finding.
COCONDITION: Employee time and effort reports were not consistently completed, certified, and maintained in accordance with the grant requirements. The auditor's review of a sample of employee timesheets found discrepancies in how time was allocated and reported for federal projects versus the PALM’s internal records. CRITERIA: The PALM is required by federal grant guidelines, specifically 2 CFR 200.430, to maintain internal controls over all aspects of their federal awards. This includes accurate and consistent documentation of personnel activity reports, timesheets, and payroll distribution records to support the direct labor costs charged to federal awards. CAUSE: The PALM lacked a formal, documented policy and procedure for tracking, certifying, and approving employee time spent on grant-related activities. Insufficient training was provided to employees and supervisors regarding the specific documentation requirements for federal grants. This resulted in personnel recording their time using inconsistent methods, including estimations at the end of a pay period, which increased the risk of inaccurate billing. EFFECT: Inaccurate time allocation led to the questioning of $65,664 in costs charged to the federal award. Since the timekeeping records did not provide reliable assurance that employee compensation was accurately charged, a portion of the labor costs was unsupported. This finding exposes the PALM to the risk of having to repay the federal agency for unallowable costs and could impact future grant funding. RECOMMENDATION: We recommend that the PALM utilize a time management software which integrates with their payroll processing, to easily identify direct labor costs related to the federal program. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: The PALM agrees with the finding, and started utilizing a new time management software in 2025 to prevent overbilling of direct labor costs. QUESTIONED COSTS: A total of $54,211 in salaries and $11,453 in benefits were calculated as questioned costs, based on annualized differences from testing.
Federal Agency U.S Department of Health and Human Services Assistance Listing Numbers 93.884 Primary Care Training and Enhancement and 93.732 Integrated Substance Use Disorder Training Program Award Numbers D58HP39725, T34HP42128, T62HP45934, T62HP49309 Criteria In accordance with the Uniform Guidance’s compensation requirements (2 CFR 200.430 Compensation – personal services), payroll expenses must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated. The Uniform Guidance allows for use of budget estimates on an interim basis. When using budget estimates on an interim basis, grantees must reconcile estimates against actual time or effort on a regular basis to ensure that estimates conform to actual staff activity. Grantees must make adjustments in the payroll distribution to align with actual time. [X] Compliance Finding [X ] Significant Deficiency [ ] Material Weakness Condition During fiscal year 2024, the Organization charged payroll costs to Federal programs based on predetermined budgeted percentages rather than actual time and effort of employees working across multiple programs. Cause The Organization did not have a process or controls in place to track and document the time and effort employees spent toward each federal award. Effect Noncompliance with documentation of personnel expense standards; improper allocation of salary and fringe benefits. Questioned Costs Indeterminable. Recommendation We recommend the Organization enhance its timekeeping processes to ensure payroll charges accurately reflect actual work performed on Federal awards. If budget estimates continue to be used, they should be reconciled regularly against actual effort. Alternatively, the Organization could implement an after-the-fact certification system to document that salaries charged to Federal programs are reasonable and consistent with actual work performed. Views of responsible officials and planned corrective action Cahaba Medical Care will implement a formal process to document time and effort for personnel, subject to the level of effort requirements. This process will require time and effort for personnel to attest to the amount of time spent on a grant monthly. These personnel have been informed of the proposed process and trained to promote consistent and accurate reporting relative to federal standards.
Federal Agency U.S Department of Health and Human Services Assistance Listing Numbers 93.884 Primary Care Training and Enhancement and 93.732 Integrated Substance Use Disorder Training Program Award Numbers D58HP39725, T34HP42128, T62HP45934, T62HP49309 Criteria In accordance with the Uniform Guidance’s compensation requirements (2 CFR 200.430 Compensation – personal services), payroll expenses must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated. The Uniform Guidance allows for use of budget estimates on an interim basis. When using budget estimates on an interim basis, grantees must reconcile estimates against actual time or effort on a regular basis to ensure that estimates conform to actual staff activity. Grantees must make adjustments in the payroll distribution to align with actual time. [X] Compliance Finding [X ] Significant Deficiency [ ] Material Weakness Condition During fiscal year 2024, the Organization charged payroll costs to Federal programs based on predetermined budgeted percentages rather than actual time and effort of employees working across multiple programs. Cause The Organization did not have a process or controls in place to track and document the time and effort employees spent toward each federal award. Effect Noncompliance with documentation of personnel expense standards; improper allocation of salary and fringe benefits. Questioned Costs Indeterminable. Recommendation We recommend the Organization enhance its timekeeping processes to ensure payroll charges accurately reflect actual work performed on Federal awards. If budget estimates continue to be used, they should be reconciled regularly against actual effort. Alternatively, the Organization could implement an after-the-fact certification system to document that salaries charged to Federal programs are reasonable and consistent with actual work performed. Views of responsible officials and planned corrective action Cahaba Medical Care will implement a formal process to document time and effort for personnel, subject to the level of effort requirements. This process will require time and effort for personnel to attest to the amount of time spent on a grant monthly. These personnel have been informed of the proposed process and trained to promote consistent and accurate reporting relative to federal standards.
Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Special Programs for the Aging, Title IV, and Title II, Discretionary Projects Grants for New and Expanded Services under the Health Center Program and Senior Companion Program Assistance Listing Number: 93.048 Pass-Through: N/A Federal Award Identification Number and Year: All Award #s under ALN 93.048 Award Period: Project period multiple; Budget period: All Projects #s under ALN 93.048 Questioned Costs: None We note over/under-billing by pay period. Type of Finding (F) Significant Deficiency in Internal Control Over Compliance of Federal Awards (G) Instances of Noncompliance related to Federal Awards Statement of Condition During our audit, we noted instances in which timesheets were not approved, and it appears that allocations are based mainly on budget rather than actual direct and indirect time spent on the grant. In July 2024, the timesheets were improved, however the general ledger amount is consistent indicating that the amount in general ledger is based on budget rather than the percentage of hours worked under the grant. Management implemented a true-up process to be able to verify the payroll charged over one year budget period. Note: the timesheet issue is related only to staff paid from multiple sources (5 out of 11 employees). Management progress: The Institute implemented a new timesheet and an annual reconciliation to verify if the allocations are truing up over one year Budget period and to adjust the Budget in the allowed threshold, if needed. Context 60 transactions were tested. Out of 60, 22 were payroll and payroll taxes related. 14 payroll transactions out of 22 tested, including wages and payroll taxes, seem to be allocated based on budget (per each pay period rather than direct time spent on grant. In some instances (paydays), some grants were underbilled and in some instances were overbilled and the net effect of questioned costs summed up close to $0 (if the overall reconciliation was taken in consideration). The Institute implemented one year reconciliation to make sure that the variations net to zero over the budget period. Criteria Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed (e.g., 2 CFR 200.430; for HHS awards, 45 CFR 75.430(i)). Records must be supported by internal controls, reflect total compensated activities, and support allocation among cost objectives. According to §75.430 (i) select standards for documentation of personal expenses are as follows: (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 and (vii) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Effect The organization does not appear to have sufficient internal controls in place and does not appear to be in compliance with grant requirements as set forth in 45 CFR Part 75. A potential effect of noncompliance of the federal award could result in disallowance of costs, suspension or termination of the award, or reduction of future allocations. Cause Internal controls over compliance do not appear to have been adequately implemented due to a lack of confirmation that the timesheet expenses match the general ledger. Recommendation We recommend the organization prevent recurrence of noncompliance through conducting regular reviews and reconciliations, providing timesheet training and guidance to staff and monitoring compliance. We also recommend a re-design of the timesheets, so grant allocations and calculations for direct and indirect cost are more easily performed and traceable to the grant general ledger. View of Responsible Official: The timesheet implemented in July 2024 properly reflects the actual vs budgeted hours for employees with multiple funding sources. We will continue to analyze discrepancies to determine if budget revisions are necessary. Finding resolved timeline: October 2025 Designated of employee position responsible for meeting this deadline: Bruce Young-Candelaria, President; Ricardo Colon Padilla, financial officer.
Finding 2024-001 Material Weakness: Allowable Costs/Costs Principles - Compliance and Control Finding ALN 84.287 - Twenty-First Century Community Learning Centers Federal Agency: U.S. Department of Education Pass-Through Entity: Missouri Department of Education Fiscal Year: For the year ended December 31, 2024 Criteria or Specific Requirement: 2 CFR section 200.430(i)(1) requires charges to federal awards for salaries and wages be based on records that accurately reflect the work performed. Condition: We noted through procedures performed that allocated salaries and wages as well as related employee benefits and payroll taxes were based on an estimated percentage of time to be devoted to the grant-funded programs as opposed to actual hours worked, resulting in a potential over-allocation or under-allocation of expenditures. Cause: Internal controls over compliance put in place by management were not designed effectively to ensure a review of allocated versus actual hours work by the federal grant was performed and that proof of such reviews was documented and retained. Effect: The possibility exists that noncompliance with federal requirements related to allowable costs and allowable activities could go undetected as there is no review or true up process for actual hours worked related to the program. Questioned Costs: In a sample of 40 expenditures, total known question costs found totaled $12,504. Likely questioned costs exceed $25,000. Context: Of the sample of 40 individual costs charged to the grant, 8 were allocated salary costs and related employee benefits and payroll taxes of full-time, salaried employees. For these 8 payroll related items, allocated costs were based on the estimated percentage of time expected to be devoted by each employee to the grant-funded program. Unleashing Potential did not maintain documentation to support the actual time and effort of each employee charged to the grant. Identification as a Repeat Finding: 2023-001 Recommendation: For employees working on grant-funded programs, management should develop a time-keeping process to track and verify that the amount of time charged to the grant is accurate and based on the employee’s time spent working on the grant. Documented review and approval of this time allocation by the employee’s supervisor should be maintained. Views of Responsible Officials: Management will implement procedures to assure that all costs charged to the 21st Century program are reviewed by a competent individual, and those reviews will be documented.
Criteria or specific requirement: 2 CFR 200.430(i)(1)(viii) states that “budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity's written policies) are identified and entered into the records in a timely manner. Short term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity's system of internal controls includes processes to review after-the-fact interim changes made to a Federal award based on budget estimates. All necessary adjustments must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: Grant hours are not consistently tracked on employees’ timesheets. Wages charged to the program are based on budgeted estimates. Per 2 CFR 200.430(i)(1)(viii), this is not allowed without additional steps to ensure accuracy, allowability and proper allocation. Insufficient evidence was presented to support a reasonable reflection of employee federal and non-federal activity. EFN does not have a written policy nor system of internal controls to review and true-up grant wages to actual. Questioned costs: Known: $37,599 Likely: $302,557 Context: During testing, CLA identified instances of time and effort not being documented on time sheets for charged payroll costs for every selection. Cause: Management was not aware that estimated budgeted costs alone are not sufficient to support personnel costs charged to Federal awards, and previous auditors had never mentioned any issue with treatment. Effect: Charging grant wages based on estimates rather than actual hours worked on the program may raise compliance concerns. Estimating grant wages without adequate support for time and effort documentation may result in noncompliance with grant regulations. This can also lead to overcharging or undercharging the federal grant, which may result in penalties or repayment obligations. Repeat Finding: No. Recommendation: We recommend that EFN incorporate a system of internal controls that clearly documents the time and effort that each individual employee spends on each grant per month. This can be done by tracking and recording the actual hours each employee, regardless of position, spends working on each grant, on their time sheet or with a specific grant code, that specifies how many hours per day were spent on each federal and nonfederal activity. Alternatively, EFN can implement an after-the-fact review procedure to ensure the proper allocation of payroll expenditures to Federal and non-Federal awards, in accordance with 2 CFR 200.430. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.267 Program: Continuum of Care Program Award/Pass-Through Entity Identifying Numbers: DA-202212-01187, DA-202407-02967, DA 202210 01319 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.430 Compensation- Personal Services: “Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non- Federal entity, not exceeding 100% of compensated activities; (iv) Encompass federally-assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non-Federal entity; and (vi) [Reserved] (vii) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity (as defined by the non-Federal entity’s written policies) are identified and entered into the records in a timely manner. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term; and (C) The non-Federal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: We noted that certain individuals who work in certain departments complete time attestations to certify the time spent on and allocated to the grant for reimbursement. For 1 out of 47 selections, the employee approval of time attestation was not available. For 6 out of 47 selections, the employee attested to time that was less than what was allocated to the grant and no true-up was completed. Cause: LifeWire did not follow their procedures to review and reconcile the estimated amounts of payroll expenditures charged to the Continuum of Care to the actual expenditures for all employees. Effect or Potential Effect: Without adequate controls in place to reconcile the attestations to the costs based on budgeted allocations are appropriate and do not require adjustment, LifeWire could incorrectly charge expenditures to the federal program, or not request appropriate reimbursement LifeWire is entitled to under the terms of the grants. Questioned Costs: Below reporting threshold. Context: This is a condition identified per review of LifeWire’s compliance with specified requirements not using a statistically valid sample. Total payroll costs for the Continuum of Care grants in 2024 were $609,817. Any payroll costs not adequately support by time and effort reports are considered questioned costs. Any payroll costs charged greater than attested time and effort reports are considered questions costs. Identification as a Repeat Finding: 2023-005. Recommendation: We recommend that LifeWire follow their procedures to review and reconcile the estimated amounts of payroll expenditures charged and that sufficient document be maintained to support any adjustments made as required by 2 CFR §200.430. Views of Responsible Officials: Management agrees with the finding. Management has modified policies and procedures to ensure staff time allocated to the grant is properly reviewed and approved and time and effort reports are completed by staff timely and documentation is retained.
Material Weakness/Noncompliance – Allowable Costs/Cost Principles 2 CFR 200 outlines the following policies required for a County spending Coronavirus State and Local Fiscal Recovery Funds: • 2 CFR 200.302(b)(7) for determining the allowability of costs in accordance with Subpart E-Cost Principles; • 2 CFR 200.430 for allowability of compensation costs; 2 CFR 200.464(a)(2) for reimbursement of relocation costs; During testing we noted that the County Commissioner’s department did not have sufficient written policies addressing the above requirements. Failure to adopt and implement policies could lead to noncompliance with federal requirements. We recommend the County approve and implement the above policies to ensure compliance with federal requirements.
Finding Number:2024-002: Community Development Block Grant Cluster - 14.218, Workforce Investment and Opportunity Act - 17.259, and 93.558 -Temporary Assistance for Needy Families Criteria:Uniform Guidance (2 CFR 200.303 and 2 CFR 200.430) requires that charges to federal awards be accurate, allowable, and supported by sufficient documentation. Internal controls should be designed and implemented to provide reasonable assurance that payroll costs are accurately billed to federal programs. Condition:During testing of payroll disbursements for allowable costs and activities allowed/unallowed compliance requirement under the Workforce Innovation and Opportunity Act (WIOA), Community Development Block Grant, and Temporary Assistance for Needy Families (TANF) the following billing errors were identified in our audit testing: WIOA: Two payroll billing errors were identified, totaling $31. CDBG: One payroll billing error was identified, totaling $505. TANF: Two payroll billing error were identified, totaling $7.Payroll charges are entered by accounting staff and subject to monthly review by the CFO. While this review process represents a key control, the errors identified indicate that the review was not sufficiently detailed to detect all inaccuracies. Cause:The errors resulted from insufficient internal control over the review of grant invoices and supporting documentation before billed to grantors. Effect or potential effect:The absence of a robust review process increases the risk of noncompliance with grant requirements and the potential for inaccurate billing to federal programs, even if the financial impact is not material. Recommendation:We recommend enhancing the existing review process to ensure payroll charges billed to federal programs are supported by underlying documentation such as payroll registers, time records, and allocation spreadsheets. This could include developing a standardized reconciliation checklist or requiring secondary review for accuracy. Strengthening the existing control will help minimize the risk of billing errors due to human oversight. Views of responsible officials:Salary and fringe benefit allocations to grants are entered by accounting staff and subject to monthly review by the CFO. While this control provides a layer of oversight, the manual nature of data entry and review introduces a risk of human error. To strengthen the reliability of this control, management will implement enhanced review procedures, including more detailed reconciliations and cross-verification steps. These improvements are designed to reduce the likelihood of errors and ensure the accuracy and integrity of grant-related payroll charges. Responsible party:Nora Davis, Chief Financial Officer
Finding 2024-001 Identification of the federal program: 21.027 – Coronavirus State and Local Fiscal Recovery Funds Noncompliance over allowable activities and allowable costs Criteria: Per the Uniform Guidance (2 CFR 200.430), compensation for personal services must be based on records that accurately reflect the work performed, and costs must be properly allocated to benefitting programs or cost objectives Condition: November’s secondary payroll distribution allocation was spread with incorrect amounts, resulting in costs being charged to the grants that were not allowable. Cause: The Cooperative decreased the sick accrual rate in November, but payroll personnel did not appropriately account for the rate change prior to spreading the amounts. Effect: As a result, costs that were not attributable to the grants were charged to them. Questioned Costs: $1,681 Recommendations: The Cooperative should implement a process to verify that changes affecting payroll allocations are accurately reflected before processing distributions to ensure compliance with allowable cost requirements. Views of responsible officials: Management concurs with the recommendation. A review process will be implemented to ensure that all payroll changes are properly reviewed, verified, and approved prior to final payroll processing.
Program name: State and Local Fiscal Recover Funds Assistance Listing: 21.027 Federal award Identification number: 43210256 Federal award year: All Federal awarding agency: U.S. Department of Treasury Criteria: In accordance with 2 CFR 200.303, non-Federal entities must establish and maintain effective internal control over Federal awards. These controls should be in compliance with Federal statutes, regulations, and the terms and conditions of the award, and should align with standards such as the “Standards for Internal Control in the Federal Government” (Green Book) or the COSO framework.. This includes controls over: 1) Payroll: Ensuring labor charges are accurate, allowable, and properly approved (2 CFR 200.430). 2) Reporting: Ensuring financial reports are accurate, complete, and reviewed prior to submission (2CFR 200.328). Condition: The Company has limited written processes of certain transaction classes. There was a pervasive lack of documentation of approval over transactions, including payroll, vendor payments, cash management, and reporting. Cause: The Company did not maintain or consistently apply documentation protocols for internal control reviews. Formal documentation practices were not in place during the audit period. Effect or Potential Effect: Lack of documentation as evidence that controls over compliance were being performed. Documentation should be maintained as evidence that sufficient control activities are in place and would effectively prevent or detect and correct noncompliance. Controls must be followed for every transaction and documentation of the control being performed must be maintained. Repeat finding: This is not a repeat finding. Questioned costs: There are no questioned costs associated with this finding. Perspective: The deficiency was pervasive across multiple compliance areas and was not isolated to a specific transaction or department. The scope indicates a systemic control weakness during the audit period. Recommendation: We recommend that the Company ensure updated policies and procedures are implemented and consistently applied. This includes: 1) Documented review and approval of all transactions related to payroll, cash management, and reporting. 2) Maintenance of written evidence supporting such reviews. 3) Regular training and internal monitoring to ensure control procedures are consistently followed. Management’s response and corrective action plan (unaudited): See corrective action plan.
Finding 2024-002, Material Weakness, Allowable Costs Identification of federal program: U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES 93.224 and 93.527 Health Center Program Cluster Criteria: 2 CFR 200.430(i) requires the auditee to establish and maintain effective internal control over the allocation of personnel expenses whereby charges to Federal awards for personnel-related expenditures are supported by official records of the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes, provided that: The non-federal entity's system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable and properly allocated. Condition: Payroll expenses were charged to the award based on budget estimates. Cause: The Organization uses a spreadsheet, prepared annually, to document the allocation of personnel costs charged across federal and other awards and indirect cost centers. Time and effort reports were not maintained or reviewed to support the allocation of personnel costs. Effect: The Organization was unable to provide documentation of time and effort for personnel who were not 100% charged to the federal award. Questioned costs: None. Context: Total compensation charged to federal awards was tested for 11 out of 92 total employees charged to federal awards. 7 of the 9 employees tested were charged to multiple cost centers. Employees tested were not charged in excess of their compensation. However, there was no documentation of how the allocations were determined beyond budget estimates. Total personnel costs allocated to the Health Center Cluster were $2,887,641. Repeat finding: 2023-004 Recommendation: We recommend that the Organization implement periodic time and effort reports to track employee allocations among federal awards, non-federal awards and indirect cost centers. We recommend that time and effort reports be reviewed by employee supervisors to ensure employee allocations are reflective of actual work performed and payroll allocation changes are made timely to reflect changes in employee duties. All necessary adjustments should be made to financial records to reflect the final amount charged to the Federal award reflects actual work performed. Views of responsible officials and planned corrective actions: See attached corrective action plan.
Criteria: In accordance with 2 CFR Section 200.430(g)(i), charges to Federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. In addition, 2 CFR Section 200.430(g)(1)(vii) states that budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting, provided certain additional internal controls are implemented. Condition: During our testing of salaries and wages, we noted that all 182 sampled transactions did not include detail by program. Charges to Federal awards for salaries and wages were based on estimated allocations, rather than use of a system of internal controls that accounts for actual time and effort. Cause: While there is a time keeping system implemented to track daily hours worked by employees, the Corporation’s current internal control system does not allow for specific coding for time actually spent on each federally funded program that would support the amount charged to the Federal award. Effect or Potential Effect: We were unable to determine whether charges to Federal awards for salaries and wages reflect specific time worked or amounts allocated by employee to specific Federal programs. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported. Questioned costs: None Context: We selected 182 salary transactions charged to the Federal programs to test controls over allowable costs. All transactions charged to the Federal programs were based on budgeted Full Time Equivalents (FTE), and not actual hours employees worked for each Federal program. No analysis or true-up was performed to determine the accuracy of employee titles or amounts charged versus actual time and effort incurred. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample. Repeat finding: This is a repeat finding from prior year. This was reported as finding 2023-005 in the 2023 report. Recommendation: We recommend the Corporation develop and incorporate internal controls in order to track specific time spent on each Federal program. This can include, time and effort reports completed on a routine basis, such as monthly, and adjust program expenditures as needed to properly reflect actual work performed. Completed time and effort reports should be reviewed and verified by management for accuracy. View of Responsible Officials: The time keeping system and process does not currently allow tracking of time based on funded resources. The past practice had been for the Finance Department manually calculated salary allocations. Due to the influx of grants and staffing resources the Corporation was unable to maintain this process.
Finding 2024‐002: Allowable costs – Material weakness in internal controls over compliance. Continuum of Care Program ALN 14.267 Crime Victims Assistance ALN 16.575 Preparation for Adult Living HHS000705800003/ HHS000705500007 Criteria: Per 2 CFR §200.430, charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. Such records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Time and effort documentation (e.g., timecards) should be signed by the employee and/or a supervisor with knowledge of the work performed. For state‐funded programs, similar documentation standards are typically required under TxGMS, which emphasize the need for adequate supporting documentation for payroll charges. Condition: During testing of payroll expenditures charged to both federal and state programs, the auditor noted that timecards for 80 out of 160 transactions tested were not signed by the supervisor. Questioned Costs: None Cause: At the time of the audit period, the Organization was newly independent from CitySquare and had not yet integrated supervisor approval of timecards into its internal control systems. This gap contributed to missing approvals during the transition year. Effect: Without properly signed timecards, there is an increased risk that payroll charges may not accurately reflect time worked on federal and state programs. This represents noncompliance with federal and state requirements and may result in disallowed costs. Recommendation: Management should implement controls to enforce a policy requiring all timecards to be signed by employees and approved by supervisors prior to payroll processing. The Organization should implement periodic reviews to ensure compliance with time and effort documentation requirements for all grant‐funded personnel. Management’s Response: See corrective action plan.
Finding 2024‐003: Allowable costs – Material weakness in internal controls over compliance and compliance finding. Continuum of Care Program ALN 14.267 Crime Victims Assistance ALN 16.575 Preparation for Adult Living HHS000705800003/ HHS000705500007 Criteria: Per 2 CFR §200.430 and the TxGMS, payroll costs charged to federal and state awards must be based on records that accurately reflect the work performed and must be supported by time and effort documentation. Charges to grants must be consistent with the actual distribution of time as documented by the employee. Additionally, expenditures charged to the grant must be supported by accurate accounting records, including alignment between timecards, payroll registers, and general ledger postings. Condition: During testing of payroll expenditures charged to both federal and state programs, the auditor noted that in 5 out of 160 transactions tested, the allocation percentages on the employee timecards did not reconcile to the payroll register and to the amount charged to the federal and state grant programs. Questioned Costs: None Cause: The exceptions resulted from delays in updating payroll/timekeeping systems and insufficient documentation to support allocation changes. Effect: Payroll expenditures did not accurately reconcile and align with actual time and effort records. This represents noncompliance with federal and state requirements and may result in disallowed costs. Recommendation: Management should implement controls to ensure amounts charged to the grants agree with timecards and payroll registers before requesting grant reimbursement. Management’s Response: See corrective action plan.
2024-002. Allowable Costs/Cost Principles United States Department of Justice, Passed through New York State, Office of Victims Services Crime Victim Assistance ALN: 16.575 United States Department of Housing and Urban Development Continuum of Care Program ALN: 14.267 Criteria: Uniform Guidance 2 CFR 200.430, covers standards for documentation of compensation-personal services. Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed and time spent. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Furthermore, these records should support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one federal award; a federal award and non-federal award; an indirect cost activity and a direct cost activity; two or more indirect activities, which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: The Organization charged costs for staff time without source documentation that complied with Uniform Guidance. Time records prepared by employees do not reflect the actual time spent on programs funded by a federal award, rather they are based on budgeted hours. Cause: The Organization allocates payroll to programs funded by awards based on the contract supported budget, which is based on an estimate of the time that work will be performed by individuals. At the time of the audit, the true-up of budgeted hours to actual hours worked had not been completed. Effect: Reimbursement for compensation under federal awards without time records that differentiate between activities conducted, such as personnel activity equivalent reports, might result in the incorrect payment amount of payroll expenses. Identification of a Repeat Finding: This is a repeat finding from the prior year, 2023-002. Questioned Costs: Dollar amount undetermined. Recommendation: The Organization should maintain Personnel Activity Reports (PAR) or equivalent documentation. This reporting of time will allow each employee to accurately reflect the time work is performed for compensation that is funded by a federal award. Views of Responsible Officials of Auditee: The Organization agrees with the finding and will modify procedures to reflect actual time worked by employee on PAR equivalent documentation, which will serve as support for personnel expenses funded by a federal award.
Criteria: 2 CFR §200.430(h)(8)(i) requires that amounts of personnel expenses are properly documented and include appropriate controls and documentation to support the distribution of the employee's wages among specific activities if the employee works on more than one award. Condition: Of the testing population, for 3 of the 4 grant awards, the Center was unable to provide timesheets or other documentation to substantiate the application of each individual's time for that period. Cause: Due to inadequate staffing resources, the Center was not able to ensure maintenance of adequate documentation. Effect: The Center isnot able to demonstrate that the personnelexpenses allocated to the grant was proper and ensure avoidance of duplication of funding requests for the same amounts. Questioned Costs: Our sample of 46 items consisted of $53,195 in costs of which $17,698 were identified as known questionedcosts.Duetothelack of timesheetsmaintainedfor3of the4grants,theentirepopulationsforthe3grantsof$136,423 is considered to be likely questioned costs. Recommendation: Management should review and refine its process of tracking payroll costs by grant to ensure that the costs are supported by a system of internal controls which provides reasonable assurance that the charges are accurate, are properly allocated, and reasonably reflect the total activity for which the employee is compensated. Views of Responsible Officials: Management agrees with the finding; see corrective action plan.
2024 – 003 Internal Control over Payroll Expenditures Federal Agency: Health Resources and Services Administration Federal Program Name: Advance Nursing Education Assistance Listing Number: 93.247 Federal Award Identification Number and Year: T5949632 2024 Award Period: 08/01/2023 – 7/31/2027 Question Costs: None Type of Finding: Significant Deficiency in Internal Control over Compliance Condition: Payroll expenditures charged to the grant did not agree to amounts reported on the time cards for 5 of the 40 payroll transactions selected for testing. Additionally, payroll expense for a new employee hired during the year was charged to the grant for a pay period prior to the employee's start date. Criteria or specific requirement: Total salaries charged to Federal awards (including extra service pay) are subject to the Standards of Documentation as described by 2 CFR §200.430(i). Per this section, salaries and wages charged to Federal awards must be based on records that accurately reflect the work performed. These records must: Be incorporated into the organization’s official records; Reasonably reflect the total activity for which the employee is compensating across all grant related and non-grant related activities (100% effort); Support the distribution of employee salary across multiple activities or cost objectives (for example, effort spent on multiple federal awards, spent on general/or administrative activities, vacation, sick leave, leave without pay, etc.); Utilize an "after-the-fact" review of the employees’ actual hours worked during the reporting period for identifying and correcting significant changes (as defined by the organization’s written policies). Effect: Lack of appropriate “after-the-fact” review and documentation resulted in incomplete support for the grant expenditures at a point in time but not in aggregate and increases the risk of payroll errors, noncompliance with federal cost principles, and misallocation of federal funds. Cause: Controls were not operating effectively to ensure review, identification, and correction of identified errors are completed prior to the drawdown process. Repeat Finding: No. Recommendation: CLA recommends that the Clinic implement a process for monitoring and review of all expenditures reimbursed by federal awards. CLA also recommends a more robust process to track, record, and document time and effort on an employee basis for amounts that are to be reimbursed by federal awards. Views of responsible officials and planned corrective actions: With the addition of personnel, the finance team has been restructured to allow for a more streamlined month-end of process. As part of the month-end process we have implemented more collaborative and robust communication between the grants management and finance teams to ensure accuracy in our grant management process.
U.S. Department of the Treasury Finding: Salary Certifications and Allocations Reference Number: 2024-005 Program: 21.027 COVID-19 State and Local Fiscal Recovery Funds Program Identifying Number: SLFRP0139 Type of Finding: Significant Deficiency Compliance Requirement: Allowable Costs Condition: We found that during 2024 the Land Bank charged payroll expense to the SLFRF Program for the period of October 11, 2022 through December 31, 2024. The Land Bank obtained certifications from each employee to document percentage of time dedicated to the SLFRF Program during the audit in September 2025. Documentation required by the Uniform Guidance to support payroll charges to the SLFRF program was not prepared contemporaneously. Criteria: CFR § 200.430,Compensation - Personal Services, applies to the State and Local Fiscal Recovery Funds Program and requires the following: Standards for Documentation of Personnel Expenses. i. Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: a. Be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated; b. Be incorporated into the official records of the recipient or subrecipient; c. Reasonably reflect the total activity for which the employee is compensated by the recipient or subrecipient, not exceeding 100 percent of compensated activities (for IHEs, this is the IBS); d. Encompass federally-assisted, and all other activities compensated by the recipient or subrecipient on an integrated basis but may include the use of subsidiary records as defined in the recipient's or subrecipient's written policy; e. Comply with the established accounting policies and procedures of the recipient or subrecipient (See paragraph (i)(1)(ii) of this section for treatment of incidental work for IHEs.); and f. Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non- Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Cause: The Land Bank did not prepare documentation (contemporaneous time sheets or time certifications) to support the allocation of payroll costs. The Land Bank did not analyze charges to other grants to determine if payroll costs were previously billed to a grant. Questioned Costs: None Effect: As a result, the Land Bank did not comply with the federal requirements for allowable costs under 2 CFR § 200.430. Recommendation: We recommend the Land Bank implement controls and policies to ensure payroll is properly documented and allocated to grant programs.
2024-002 — Allowable Costs/Cost Principles Federal program information: Funding agency: U.S. Department of Health and Human Services Title: Indian Self-Determination, Medical Assistance Program ALN: 93.441, 93.778 Award period: 1/1/2024 – 12/31/2026, 1/1/2024 – 12/31/2024 Criteria: According to 2 CFR Part 200.403, to be allowable under federal awards, costs must be adequately documented. Additionally, the 2 CFR Part 200.430 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. Condition: Employee benefits expenditures charged to the programs do not agree to supporting documentation, such as employee benefit provider premium invoices. Context: All employee benefits charged to the programs. Questioned Costs: Undeterminable Cause: The payroll module and account structure setup in the accounting system (multiple benefits going into one benefit account) made it virtually impossible to reconcile employer benefits to the employer benefits provider premium invoices and/or employee benefit election forms. Effect: ABHS may not be able to demonstrate that the costs charged to federal programs are allowable. Auditor’s Recommendations: ABHS should implement a reconciliation process to ensure that employee benefit expenditures charged to federal programs agree with employee benefit provider premiums invoices and/or employee benefit election forms. Management’s Response: ABHS has implemented a new accounting and payroll system which allows the organization to reconcile employee benefit expenditures monthly. These systems were implemented in March and April of 2025 and management expects this finding to be resolved in 2025.
2024-006 - Failure to Maintain Standards for Documentation of Personnel Expenses Finding Type. Immaterial Noncompliance; Significant Deficiency in Internal Control over Compliance (Allowable Costs/Cost Principles). Programs. Environmental and Scientific Partnerships and Programs; U.S. Department of State; ALN Number 19.017; Award Number SAQMIP23CA0021 Criteria. Per 2 CFR 200.430 (g), charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must be incorporated into the official records of the recipient. Condition. During our testing of Allowable Costs, for all 12 disbursements tested we noted that the hourly rate charged under the grant was higher than the actual hourly rate noted in personnel files. Cause. This condition appears to have been caused by a lack of knowledge of applicable federal compliance requirements causing the grant to be incorrectly charged. Effect. As a result of this condition, the Organization did not fully comply with the Uniform Guidance by not charging the proper hourly rate to the grant. Questioned Costs. No costs are required to be questioned as a result of this finding, in as much as the actual and projected error was de minimis. Recommendation. We recommend that the Organization use actual rates per approved compensation records when charging costs to the grants. View of Responsible Officials. Management agrees with this finding and has prepared a Corrective Action Plan.
Program Name – Temporary Assistance for Needy Families (TANF); Services for Trafficking Victims ; Violence Against Women Formula Grants CFDA Number – 93.558 16.320, 16.588 Finding Type – Significant Deficiency and Noncompliance Criteria – Title 2 CFR 200.430(i)(1) states that charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Title 2 CFR 200.431(b) states for Leave the cost of fringe benefits in the form of regular compensation paid to employees during periods of authorized absences from the job, such as for annual leave, family-related sick leave, sick leave, holidays, court leave, military leave, administrative leave, and other similar benefits, are allowable if the costs are equitably allocated to all related activities, including Federal awards. Condition and Description – During our procedures, we noted, the Agency did not properly allocate its employees’ leave hours for employees working on multiple activities. For 13 out of 20 samples selected for testing, Controls were not in place to ensure that leave time was proportionately distributed based on actual time worked on each activity. Question Costs – Unknown Identification of a Repeat Finding – This is not a repeat finding from the immediate previous audit. Cause/Effect – Controls were not in place to ensure the proper allocation of its employees’ leave hours for employees working on multiple projects. Recommendation – We recommend that the Agency implement formal policies and procedures to ensure leave hours are allocated consistently and accurately across all activities based on the actual proportion of time employees spend on each activity. Views of Responsible Officials and Planned Corrective Actions – Corrective action was implemented in March 2025. No employee leave hours are to be billed to the TANF grant. The cost of employee leave will be born by non-governmental grants for all Victim Service staff.
Criteria or specific requirement: Per 2 CFR part 200.430(g)(1), "Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed." Furthermore, 2 CFR 200.430(g)(1)(vi) indicates that these records must "support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on... a federal award and a non-federal award" and 2 CFR 200.430(g)(1)(vii)(C) requires that allocations to Federal awards based on budget estimates must be reviewed after-the-fact and that "all necessary adjustments must be made so that the final amount charged to the Federal award is accurate, allowable, and properly allocated.” Condition: In a statistically valid sample, 4 of 14 payroll expenditures tested, grant hours were not consistently tracked on the employees’ timesheet. The wages charged to the program were based on the budgeted estimates. Per 2 CFR 200.430(i)(1)(viii), this is not allowed without additional steps to ensure accuracy, allowability and proper allocation. Insufficient evidence was presented to support a reasonable reflection of employee federal and non-federal activity. The Organization does not have a written policy nor system of internal controls to review and true-up grant wages to actual. Questioned costs: $58,881 Context: A sample of 14 was made from a population of 116 transactions charged to the major program for salaries and benefit expenses. Of the 14 sampled costs, 4 were found to be out of compliance with the provisions for 2 CFR 200.430 Compensation - personal services of Uniform Guidance. The four transactions questioned were isolated to the Finance Director and Executive Director’s recording of time and effort and there was a misunderstanding in relation on how to charge their salaries and benefit expenses to the program. The grant allowed up to 25% of their salaries to be charged to the program, a different process from the other salaries and benefits allowable under the grant, and actual time and effort was not documented. The error of actual costs reported on the schedule of federal expenditures results in the likely questioned cost amount of $58,881. Cause: The employees did not code their programmatic time to a specific grant time charge code and there was not a process to make after-the-fact review/adjustments to applied budgeted allocations. Effect: Recording grant wages based on estimates rather than actual hours worked on the federal program may result in payroll-related amounts being booked to the program that do not reflect actual effort, which could lead to an overcharging or undercharging of the federal grant. Repeat finding: No Recommendation: We recommend that the Organization incorporate a system of internal controls that clearly documents the time and effort that each individual employee spends on each grant per month. This can be done by tracking time worked to federal programs via timesheets or by implementing look-back procedures to ensure estimated allocations of payroll costs are adjusted to reflect actual activities. Views of responsible officials: There is no disagreement with the audit finding.
Repeat finding: There was a simialr finding in the prior year, but it related to a different program and was assessed to be a significant deficiency. Condition: During our testing of payments charged to the federal major program, we noted that employee timesheets lacked evidence of review and approval. Certain employees charged to the grant did not prepare timesheets and a separate tracking system was used. Federal regulations require that expenditures charged to Federal awards be properly reviewed, approved, and documented to ensure allowability and compliance with grant terms. Criteria: Under the Uniform Guidance, specifically 2 CFR 200.430, charges to Federal awards for compensation must be supported by a system of internal control which provides reasonable assurance that costs are allocated appropriately and accurately. Per 2 CFR §200.403, allowable costs must be "necessary, reasonable, and adequately documented." Additionally, 2 CFR §200.302(b)(3) requires non- Federal entities to maintain records that sufficiently detail financial transactions to support Federal expenditures. Cause: The Federal program was new to the organization and controls over the program had not been fully established. Turnover in the accounting department contributed to the lack of resources for tracking these costs. Effect: Management provided documentation on personnel costs allocated to the program, but was unable to provide evidence of review. Lack of review increases the risk of unauthorized or unallowable costs being charged to the Federal award, potentially leading to questioned costs and noncompliance with Federal grant requirements. Context: This issue applied to approximately 50% of the compensation costs charged to the grant expenditures. Management performed time studies on some of the employees whose costs were shared among programs, and the local granting organization did not cite this as a finding in their review of their subrecipient’s activities. Recommendation: Management should review the requirements of CFR 200.430 and ensure that current processes, whether digital or hard-copy driven, are consistent with the requirements of the Uniform Guidance. In addition, management should consider adding additional staff to its accounting and/or grants management team. Views or reponsible officials: Management will evaluate systems and processes to ensure time tracking procedures meet the standards outlined in the Uniform Guidance.
2024-001 – Coronavirus State and Local Fiscal Recovery Funds – ALN No. 21.027 - Distribution of Compensation – Internal Controls over Allowable Costs and Activities (Significant Deficiency) Grant No. X50-8-018 Passed through Office of the Governor, Criminal Justice Coordinating Council Grant Period: October 1, 2023-September 30, 2025 Criteria: Under 2 CFR Section 200.303(a), non‐federal entities must establish and maintain effective internal controls to provide reasonable assurance that the entity is managing the federal awards in compliance with statues, regulations, and the terms and conditions of the award. Additionally, under 2 CFR Section 200.430(i) compensation records must support the distribution of the employee’s compensation among specific activities or costs objectives if the employee works on more than one Federal award and compensation of employees used in meeting cost sharing or matching requirements on Federal awards must be supported in the same manner. Condition: For specific payroll costs selected, the compensation records supporting the distribution of employees’ compensation to the federal award did not equal the amounts charged to the federal grant. Effect: The lack of controls to ensure the correct amounts are charged to the federal program based on the time and effort of the personnel could result in charging unallowable costs to the federal program. Cause: The Foundation calculated the amounts charged to the federal grant based on the budgeted percentage of time for each employee rather than the actual hours per the compensation records. Known Questioned Costs: $273 Likely Questioned Costs: $3,122 Perspective: This finding represents a systematic problem. Of the twenty-five transactions tested, five had errors. The sample was not statistically valid. Repeat Finding: No Recommendation: We recommend the Association establish policies and procedures to ensure that compensation is properly documented and distributed between Federal awards and properly approved.